Friday, November 30, 2012

DD cutting wages, VFX Union update

Hmm, maybe part of this should be done as a title crawl against a star field.

Digital Domain, one of the largest visual effects companies in the U.S. has been going through some rough times. They were purchased by an investor a few years ago and went public a year ago with the mentality of creating an animation group to make their own movies (the IP that everyone says will save a visual effects company) along with setting up a school for visual effects students in FLorida with students paying tuition to actually work for free on some of the projects Digital Domain Media Group was planning to make there.  They chose Florida because they (John Textor, head of DDMG) was able to talk the state and local governments to pay for much of this. And of course that all fell apart and the company went bankrupt... but not before they were able to sell the core of Digital Domain, it's visual effects company, to Galloping Horse (a media company from China) and Reliance (a huge company in India).

And of course this last week the employees there were given ultimatums to work at reduced salaries or consider themselves resigned. They have to decide by Monday. Evidently this applies to even those with contracts and at all ranges of jobs there. This occurred while they are working on large Hollywood projects.

Why was this done? I'm sure 'business' people in the acquiring companies looked at the numbers and wanted them to be even better. The easiest thing in the world to do for company management is to lower wages. That avoids the time and hassle about thinking about how to cut waste and how to be more efficient. Focus on the short term, ignore the long term issues. Forget the fact that the most important part of a visual effects company are the employees. Otherwise it's just a building with computers which anyone can setup.

I'm sure over a year ago most people working there thought everything was going reasonably. Not great and with need for improvement but at least they had jobs and DD was still in a reasonable place. No one would have predicted what actually happened this last year.

Those who signed on to work on the animation project and the 2D to 3D conversions and moved themselves and their families to Florida had no idea the rug would be pulled out from under them with no notice.

Those working at DD in Venice would have no idea that their company would go into bankruptcy and acquire new owners.

Those working at DD had no idea they'd be asked to reduce their wages out of the blue while working on a project.

I'm sure those working at Sony's New Mexico facility had little notice before that was closed. Or the Sony artists who were told they could work in Vancouver or quit.

And Double Negative recently laid off quite a number of people that didn't expect that to happen.

I think the key lesson here is no matter how safe you think you are, even if you're with a large company, even if you're in an area with plenty of film incentives, you may find the rug pulled from underneath you at anytime. You can't keep your head buried in the sand forever. You can't live in a magic bubble. Your incentives will not protect you forever.

Will you be willing to move to China and work in poor conditions at a fraction of your wages? Because that's where it's all headed at this point. The Chinese company that bought DD will be using it to train people to work in China.

And yet most of this seems to fall on deaf ears. According to many commentors on other forums they have no issue moving every year and dragging their families with them for no logical reason. Good luck with that.

In a short time most visual effects artists will have to make a decision if they haven't already.
Those at DD will have to make this decision by Monday.

1. Suck it up, roll with the punches and let the companies and studios disperse you randomly around the world for whatever wages and working conditions they choose.

2. Quit. Give up what you love. Go into something with more stability and less crazy hours.

3. Stand up and do something. Speak up. Group together. Stand together. Join a union. Think of better solutions.

Starting a visual effects company is not a solution.

Welcome to the new world order.

Site by and for Digitial Domain artists in regard to this issue

From VFXSoldier  Digital Domain pay cuts
From this blog VFX Artists don't need to be taken advantage of


DD Info from VFXSoldier
Digital Domain purchased
DDGM files for bankruptcy
Digital Domain financial problems
 From this blog:
Digital Domain plans to have paying students make up 30% of work force

Visual Effects Industry overview
Pass me the nail
Waiting
What Happened?

--------------------

Reminder for those in Southern California tomorrow:

Understanding Unions: The Good, The Bad & Unknown Of Forming A Visual Effects Collective Bargaining Organization


Be sure to RSVP at VES Event page


Saturday, December 1, 2012 from 9:30AM to 12:00PM
Los Angeles Film School Theater
6363 Sunset Blvd., Los Angeles, CA 90028

Hopefully it will be clear and informative and not be rants about the auto industry and other chestnuts.


[Update 12/3/2012  fxGuide has a write up of the meeting. Video should be available at some time in future at the VES website for members. And yes, the auto industry was mentioned.]

Maybe they'll have pins tomorrow


Related:
Visual Effects Guilds
Visual Effects Union, Take 2
Unions, the Middle Class and Visual Effects
Using the nail
Unions, VFX working hours and environments
How do these things tie together?



11 comments:

  1. I'll bring the pins. I hope to have a place to put them.

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  2. There is a quite obvious solution - quit and find another job. There are other studios too.

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  3. The point is to be able to make longer plans. This is not just an issue today for DD employees.

    You can quit and go to another studio IF there is a studio with:
    1. jobs - Maybe very lacking in the area you'd like to work.
    2. reasonable working conditions
    3. Decent pay
    4. Decent benefits
    5 location that you like.

    As the work shifts and changes are being made to the industry, simply saying quit and work at another company may not be a real option.

    That's what people say to unemployed people. "Why don't you get a job? Go work at McDonalds". As is jobs were available on every street corner. A year or so ago McDonalds had over a million people apply for 65,000 jobs. Even in the normal economy McDonalds was not a sure thing for anybody to get employed.

    Once the work dries up and/or other companies reduce their wages by x% to remain competitive, people will have to make a choice regarding the options above. Simply quitting and going to work at a similar company down the street will unlikely be an answer in the term.

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  4. I am no lawyer, but from what I understand of the letter, people are not forced to either sign it or resign. They can reply saying "I won't sign it, and I won't quit" (or not reply at all, which means the same). Meaning DD would have to fire them (with the proper notice etc) if they want them to leave, and the artist would get unemployment benefits.

    Obviously, unionizing, striking etc might be the best offensive move, but the best defensive one seems to simply do nothing. There's no reason for anyone to resign. If they want to keep you, they'll have to do it on your terms. And if they're fine with getting rid of you, much better being laid off than resigning.

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  5. Production companies(clients) have the right to go somewhere cheaper. So when the works dry out, a vfx owner have two choice: 1.close 2.do it cheap. Many vfx companies already chose to close which cause many people lose job. Even more vfx studios chose to do it cheap. That's why artists wages get cut. Instead of close, this way no one make profit but at least people still have jobs. What a union could do? Says artists should get certain wages and benefit? Then the vfx studio either have to rise the budget which equal to push more productions go abroad or close the company before bankrupt. The vfx studios are not bad people here who treat artists unfairly. The problem is there is always people willing to do things cheaper and cheaper. And there is no reason a production company shouldn't go for cheap so they make more profit. I don't see have a union can help in the long term at all.

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  6. I've broken this comment into 2 since blogger doesn't allow longer comments.

    Actually none of that's true.

    Studios make an investment in a film to make money. In the case of most vfx tentpole pictures they do well, in some cases they do very well. They pay all the people who work on the film a reasonable wage and above. Union people are employed in US and a number of them work in other countries when the work goes there and they're still covered by the union. So they get over time, health care and other protections and they receive at least a minimum pay. Most union film workers are paid above scale.

    There's no reason on a $200 million film to shaft vfx workers.

    Cost is not the only factor in making a film or in anything. Does everybody buy everything at the dollar store? No, because you can't buy quality for cheap. Will audiences pay $10 to see 2 hours of youtube clips that were made for free strung together? No.

    So if they are trying to produce a quality film that people will pay to see, studios know they will have to pay directors, actors, writers, crews etc. decent money so they can get decent work. They know they have to invest in hair, makeup, set design and all the other things that are required to make a decent film that can be sold.

    Visual effects crews are the ones helping the studios to make the most profits. Look at the top 50 films. Look at the top money makers from this year. Avengers, Life of pi, Hobbit, etc. So why should the effect crew not be paid overtime and be forced to cut their wages? What makes them less valuable than any of the other crew members (who are union)?

    The biggest savings a vfx company can make is to bid the project correctly, charge accordingly and to work with the director and vfx crews to be as efficient as possible. Poor management is not the responsibility of the crew to pay for.

    " Instead of close, this way no one make profit but at least people still have jobs." So how low should workers be willing to go to help the company? Should they work for minimum wage and not earn a living? Is that low enough?

    ReplyDelete
  7. "Then the vfx studio either have to rise the budget which equal to push more productions go abroad or close the company before bankrupt. "
    VFX companies have to charge what it costs to do the work. Underbidding is not accomplishing anything, only causing more and more companies to lose money and devalue of all work. The unfortunate fact is some companies may have to go out of business. If they can't manage to make a profit by doing the work correctly maybe 1. There're not managing correctly 2. Maybe there are too many companies competing of r the work. Like over fishing a given area. There isn't an infinite amount of work and by creating more and more companies, all willing to underbid, it merely causes all companies and workers to lose.

    "The vfx studios are not bad people here who treat artists unfairly."
    Yes, they are in fact bad people if they treat artists unfairly. Because the vfx companies are the ones n a position to make a profit and they control the arrangement with the studio. The artists are doing their work correctly and are the key asset for any vfx company. If a company randomly cuts wages, doesn't pay overtime, provide poor working conditions or do other things that are unfair to workers then yes, they are bad people.

    "The problem is there is always people willing to do things cheaper and cheaper."
    Quality vfx takes skill, artistry and knowledge. For those just starting out willing to do the work for cheap then they've just devalued themselves and their future careers. And the companies hiring them will get just what they pay for - cheap labor, cheap work results.

    "And there is no reason a production company shouldn't go for cheap so they make more profit."
    So how much profit should they make? Is there a limit? Should lAvatar be even more profitable so the studio executives and shareholders can celebrate? Should they cut all the wages who worked long and hard on Avatar to 1/2? Would that be enough to satisfy profits?

    The big picture is:
    1. Vfx is very profitable for studios
    2. vfx artist are hardworking and skilled and help the studios get the bigger profits already
    3. People have to be paid enough to not only live but to purchase materials and services. Thats' why we're in the world recession now is because the people who buy things can not afford them because the rich have decided they simply wish to be more rich. And that is not a long term plan.

    Maybe you should start looking at the whole picture and at the value of visual effects instead of trying to make the straw case for the vfx company you manage.

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  8. Hi Scott,

    I think you are right about the value of vfx artists. But I have to say, vfx studio underbidding already become a big problem. I used to work at Matte World. They were famous and produce good works. But due to so many vfx studios willing to do things cheaper, they decided to quit the game before lost money. And to be honest, those studios willing to do things cheaper provide just as good quality work. I can say this because I am working for them now. I get lower paid than I used to and I have to move. The union might be able to protect minimum wages but even this lower paid still above the minimum. And I have to accept it and move for surviving. What can you do to my boss? Tell him not to underbidding and give everyone a raise? Or tell the production company and directors they have to pay for revision? I think the overall problems is bigger than just "bad boss".

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  9. Underbidding work helps no one and simply accelerates a race to the bottom. Artist end up being paid less and companies will go out of business. Boneheaded would e the best way to describe it.

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  10. You have to take a stand at some point. When you simply accept the reduction in pay, as Scott says, you are not only devaluing yourself, but setting a horrible president. Yes, if you say no to a lower rate, then they may pass on you, but there are other companies, and other work, and if enough people take a stand, then perhaps VFX studios will finally get it.

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  11. All this talk of telling a company to "pay me my worth or I'm walking" is exactly what I said when I was single. But once a family comes along, you quickly value a paycheck. Any paycheck.

    With so many studios only looking for the lowest price instead of experience, it's really hard not to bend over.

    ReplyDelete