A California Chamber of Commerce-opposed bill that would drive film industry jobs out of California passed a Senate policy committee this week.
The bill, AB 437 (Kalra; D-San Jose), passed the Senate Labor, Public Employment and Retirement Committee on June 22. Committee members acknowledged opponents’ concerns about the bill’s interference in the collective bargaining process and directed the bill’s author to continue to work on the bill.
AB 437 prohibits use of exclusivity clauses in acting contracts, which undermines collective bargaining in the film industry and will result in lower value contracts and job loss.
The provisions of this proposal will deliver a massive blow to film and television, which contribute substantially to the state’s economy.
A recent study by the Phoenix Center for Advanced Legal and Economic Public Policy explains that curtailing the use of exclusive contracts for actors makes such contracts less valuable, which will lead to a reduction in wages paid to actors. Further, elimination of the ability to bargain for exclusivity rights where necessary jeopardizes the ability to timely and reliably produce content. The ripple effect will have a negative impact on the thousands who work on those productions or are otherwise linked to or dependent on them.
Circumvents Collective Bargaining
Through their unions, workers in the entertainment industry negotiate collective bargaining agreements every three years. The terms of those agreements have been refined and developed through years of bargaining to balance the needs of workers and the industry. AB 437 attempts to undermine that collective bargaining process by legislating around it.
The bill is sponsored in part by the unions representing these workers. The provisions in AB 437, such as those dealing with exclusivity provisions in a contract, were raised in negotiations, but were not agreed to by the parties. The parties ultimately reached an agreement that did not include the terms sought here and AB 437 seeks to undo that agreement.
In a letter submitted to legislators last week, the CalChamber pointed out that legislative interference in collective bargaining is impermissible and is preempted by the National Labor Relations Act.
Where the union and employer reach an agreement, it is inappropriate to then seek legislative action to undermine those negotiations simply because one party did not get everything they desired, the CalChamber said.
“Enacting AB 437 would set a dangerous precedent that when a union does not get everything it wants during bargaining it can instead appeal to the Legislature to codify its specific requests,” the CalChamber warned.
Actors and production companies routinely negotiate specific contracts that are unique to individual actors, and both sides are represented by experienced lawyers and business managers. AB 437 undermines those negotiations by legislating specific terms and limiting the ability to renegotiate those contracts.
Enacting AB 437 would set a dangerous precedent that impedes the freedom to contract, the CalChamber said.
Key Vote
AB 437 passed Senate Labor, Public Employment and Retirement, 4-0:
Ayes: Cortese (D-San Jose), Durazo (D-Los Angeles), Laird (D-Santa Cruz), Newman (D-Fullerton).
Absent: Ochoa Bogh (R-Yucaipa).
The bill will be considered next by the Assembly Judiciary Committee.
