Negotiation Battle: Tom Hanks vs. Mel Gibson

The SAG And The Studios Are Deadlocked In Their Negations, Now What?
The SAG And The Studios Are Deadlocked In Their Negations, Now What?

In the world of Hollywood, they have the ability to make the unreal seem oh so real. However, right now they are having a great deal of difficulty negotiating to make a contract between the big movie studios and the Screen Actors Guild (SAG) become a reality. Are we going to be looking at another actors strike?

Perhaps a bit of a background is needed here. The SAG is a 120,000 member union that represents, what else, actors. The SAG is currently negotiating with the major studios to create a new contract for its members – their old contact ran out back in June.

This type of negotiation is fairly common. However, what’s making it interesting this time around is that there appears to be a difference in opinion on how best to negotiate within the SAG. This is causing a split to occur and may be significantly reducing the SAG’s negotiating power.

Within the SAG there are two groups that are taking differing views of how the negotiations need to proceed. The first group, called Members First, is lead by the SAG’s president Alan Rosenberg and their Executive Director Doug Allen. Doug also happens to be the SAG’s chief negotiator. The second group calls itself Unite for Strength and has won several key seats on the board and now, by aligning with other board members, has a slight majority.

So what’s the issue here?

Currently the SAG is in deadlock in their negotiations with the big studios. The Members First team wants to have the SAG members vote to authorize a strike if the negotiating team needs to call one. The Unite for Strength team wants the board to vote against having a strike vote as well as having them replace the current negotiating team. Talk about bad blood!

If the Unite for Strength team got their way, then they would probably try to jump-start the stalled negotiations with the studios. They would go along with the pay terms for new media that other unions have negotiated with the studios as  an exchange for getting improvements in the traditional media pay areas.

Why does the Unite for Strength team not want a strike vote to be taken? They believe that a strike now would be a poor decision based on the current economic state of the country.

Tom Hanks supports the Unite for Strength team. Mel Gibson supports the Members First team.

Just to make things a bit more complicated, the studios are insisting that their current offer on the table is their final offer. It contains some provisions that no SAG members likes such as a proposal to eliminate mandatory meal times (I mean come on, an actor has got to eat…)

So what should a negotiator make of all of this back-and-forth?

First, the public SAG split is bad news for the actors because it transfers power to the studios. When the other side of the table is in disagreement, your position is stronger. However, this also means that reaching an agreement with the SAG will be more difficult – the studios need to get all of the SAG to agree to a new contract.

It looks like SAG has done a poor job of PLANNING their side of the negotiation. There is a critical question of what is more important: money from traditional (films, TV) media or money from new (DVD, Web) media. Pick your poison, but this is an issue that all of the SAG needs to get behind.

Both sides of the table are at fault for allowing the deadlock to continue for six months. One subtle point here is that the studios may be willing to live with a deadlock because there is no current threat of a strike and the longer they wait, the greater the split within the SAG grows.

If the SAG replaces their negotiating team, then there will be a great deal of negotiating ground that will need to be revisited as the two negotiating teams meet for the first time and work out their negotiating positions.

What’s to be learned from this negotiating mess? A couple of key points: negotiations need to be planned out before discussions start so that inter-team squabbling can be taken care of BEFORE the talks start. Next, replacing a negotiating team during negotiations is a radical step that should be avoided at all costs – it’s just too expensive in terms of time. There’s a lot more to learn here, but I’m pretty sure that time will reveal what mistakes were made and which side ended up with more negotiating power…

If you were a member of the SAG, which team would you want to be a part of (the Tom Hanks team or the Mel Gibson team)? Who do you think has the stronger position in the negotiations right now? What would your next steps be if you were the studios? Leave me a comment and let me know what you are thinking.