WGA members have voted overwhelmingly – 95.3% to 4.7% – to approve the unilateral imposition of a new Agency Code of Conduct, just six days before the guild’s existing franchise agreement with the Association of Talent Agents is set to expire. The final vote by the combined members of the WGA East and West was 7882 in favor to 392 opposed.
The one-sided vote, though not unexpected, should bolster the WGA’s bargaining position by letting the agencies know that writers aren’t bluffing – that they really are ready to walk out on their agents, altogether and all on the same day. The ATA says that would create “chaos” in the industry. The WGA calls it a “difficult” part of a necessary “realignment” of a “corrupt” business model that has and will continue to drive down the over-scale pay – which agents negotiate – of thousands of writers, producers and showrunners.
The ATA issued a statement on today’s outcome.
“Now that the WGA is past its vote,” the ATA said, “we look forward to getting back into the room to work through an agreement that serves the best interest of writers, respects their individual choice, and prevents unnecessary disruption to our industry. We stand ready and waiting.”
The WGA and the ATA are expected to return to the bargaining table later this week, although no date has been set. The deadline for a deal is April 6. After that, if no agreement is reached and the talks aren’t extended, the guild could order its members to walk away from any agents who refuse to sign its new Code.
At last count, nearly 800 writers – including many of TV’s top showrunners – have pledged that they will do just that if a new franchise agreement isn’t reached. They could still keep their same agents for directing jobs, but not for writer deals. Writer-directors would have to have two agents at different agencies to procure employment for them, which only licensed talent agents are allowed to do.
The ATA, meanwhile, has said that its members standing together too – that more than 100 of them, including all the major agencies that do nearly all the packaging, have pledged that they won’t sign the WGA’s Code. Thus, the showdown
The impact of a writers’ walkout on the upcoming TV staffing season, if it comes to that, would be felt immediately, as thousands of writers would be looking for jobs and agents at the same time. TV production, however, won’t feel so much as a hiccup because writers will remain on shows already in production and on those with signed deals. But their agents won’t be allowed to represent them or renegotiate for them if they don’t sign the Code.
TV development, however, would quickly see significant turmoil because the big four agencies are deeply involved in the development of the shows they package – and they package the vast majority of them. Studio and network development divisions would have to pick up a lot of the slack for the WGA’s plan to succeed to reinvent agenting.
Independent films could also discover that funding and distribution is harder to find, which the big agencies bring together in deals they package. A slowdown in that sector, the ATA says, would hurt actors, directors and crewmembers as well.
The guild, meanwhile, has taken the unpreceded step of deputizing its members’ personal managers and lawyers to serve as replacement agents for the top agents they no longer will have if the Code is implemented. Many writers don’t even have agents, managers or lawyers, and like many of those who do, say they will find writing jobs on their own, as many say they do already.
To help connect writers with hirers, if necessary, the guild has also created a new electronic jobs board – called the WGA Staffing Submission System – that’s already recruited hundreds of showrunners and executive producers who’ve pledged to review their fellow writers’ self-submissions for staffing on TV shows.
The lopsided vote on the new Code was expected because the WGA’s negotiating committee, the WGA West’s board of directors and the WGA East’s Council had voted unanimously to recommend its approval. The ballot stated: “Do you authorize the Board and Council to implement an Agency Code of Conduct, if and when it becomes advisable to do so, upon expiration of the current Artists’ Managers Basic Agreement on April 6, 2019?”
The two key issues, on which there’s been no movement at the bargaining table, remain the WGA’s demands that agencies stop charging packaging fees and sever their ties with affiliated production entities – both of which, the guild says, are conflicts of interest that violate agents’ fiduciary duties to their clients.
Packaging has been around for decades, and is dominated by the big four talent agencies – WME, CAA, UTA and ICM Partners. According to the guild, 87% of all scripted TV shows were packaged during the 2016-7 television season, and 79% of those shows are packaged by WME and CAA. Packaging involves agencies bringing together the creative elements of a show, for which they receive a packaging fee in exchange for not charging clients their 10% commissions.
The negotiations have been the most acrimonious in decades – perhaps even more so than during the failed talks that led up to the WGA’s 2007-08 strike. At least then, the guild wasn’t accusing the studios and networks of committing crimes.
The WGA has accused the big four agencies of running a vertically integrated “cartel” that’s cornered the market on Hollywood’s talent, and has threatened to sue the agencies, calling their packaging fees “illegal kickbacks.”
Chris Keyser, co-chair of the guild’s negotiating committee, has said that “the agency business in now dominated by four agencies – an oligopoly. They have an overwhelming percentage of the market share, and their control over that and packaging and the assessment of packaging fees has made this a question that we have to answer now.”
Unlike packaging, agency affiliations with related production/finance entities – like WME has with Endeavor Content, CAA has with Wiip, and UTA has with Civic Center Media – are a relatively new phenomena, although the WGA compares them to the stranglehold that mega-agency MCA and Universal had on talent before the Justice Department forced it them to separate in 1962 as part of an anti-trust action.
The guild has made public dozens of anonymous members’ horror stories about their agents, variously described as selfish, greedy, disloyal, lazy, conflicted and conniving liars. But nowhere does the guild address the real reason so many of its members – including many of Hollywood’s top writers, directors, actors and producers – are represented by the big agencies – their clout.
Their clout to get studio bosses and superstars to return their calls; to make a deal on a napkin at the Polo Lounge; to connect investors to their clients’ vanity projects and blockbusters alike. Their clout to get movies made and TV shows on the air. Clout like that can’t be quantified through the latest algorithm, but if agents were to go on strike, deal-making on the scale that Hollywood is so dependent would come crashing to a halt overnight. Clout is why so many A-listers have A-list agents. It’s why so many business meetings begin with the question: “Who’s your agent?”