Don’t expect the two-week-old SAG-AFTRA strike against the video game industry to end any time soon. Not unless the companies are willing to compromise on the key strike issue: residuals.
By all accounts, the union and its members, who will picket WB Games today in Burbank, are resolved to hold out for as long as it takes to get a fair deal. They want the industry to finally accept residuals as a key component of compensation — just like the TV industry has since the SAG strike of 1955, and like the film industry has since the actors strike of 1960.
The union has offered a modest proposal — to give the companies the option of paying more up front, or paying “secondary compensation” on the back-end if their games are successful. The companies, however, balked at that idea.
“The SAG-AFTRA proposal has two options for game producers,” the companies say on their website. “The union’s first proposal for an optional ‘contingent fees’ structure is so onerous that no one would elect to use it. The union’s second option is virtually identical in money to the companies’ proposal.”
If the union’s contingent fee option is truly “so onerous” why won’t the companies accept it and then just not use it? The answer is that the companies fear that, like the proverbial camel that got its nose under the tent, once any type of back-end payment is codified into the contract, the union’s demand for full-blown residuals would be sure to follow.
The calendar, as much as anything, prevents the union from backing down. In a few months, it will begin negotiations for a much bigger contract — the SAG-AFTRA film and TV pact, which generates more than $1 billion a year for performers. By contrast, the video game contract, which is the union’s smallest, generates a small fraction of that for actors. Updated figures are hard to come by, but it’s believed to put less than $30 million into the pockets of actors each year. In 2010, the last time SAG made figures available, guild members earned only $2.4 million under the contract. But that was before SAG merged with AFTRA, which had the lion’s share of video game work.
Given the much higher stakes in the upcoming film and TV contract talks, it’s almost inconceivable the union would back down in its showdown with the video game companies. To show weakness now would almost certainly undermine its bargaining position. And those talks aren’t expected to begin until early next year – after the DGA concludes its film and TV contract negotiations, which are scheduled to begin early next month, and after the WGA concludes its deal.
So unless one side blinks soon, the video games strike could drag on for months to come.