Need for Collective Bargaining

Authors, freelance journalists, and other creators need the ability to collectively demand better treatment and terms for their work from those they work for. They work on a freelance basis for publishers under standard contracts and often for low pay, with almost no ability to negotiate better terms.

The specifics differ from industry to industry, but creative freelance professionals all share one thing in common: they are workers with no employee protections, no benefits, no minimum wages, no ability to collect unemployment, and yet no ability to negotiate their contracts or to collectively bargain for better terms. Many do not make minimum wage and have seen massive decreases in their pay in recent years, while more and more rights are extracted so that they cannot sell them separately.

Writers and other freelance creators are prohibited by the antitrust laws from acting together to negotiate better rates or financial terms. U.S. law recognizes only two types of workers—employees and independent contractors—and it treats all independent contractors as though they are independent, competitive businesses with the ability to negotiate with the buyers of their services. Most writers and other creators, however, are more akin to employees in that they have very little bargaining power and are given agreements to sign on essentially a take-it-or-leave-it basis.

For self-published authors, publishing platforms such as Amazon and Audible provide click-through agreements, with no pretense of allowing negotiation, while traditional publishers only give lip service to negotiating by allowing certain terms to be tweaked around the edges of the employers’ standard forms.

Walking away is not an option for most writers because when one publisher changes their contract terms against authors’ interests, the others follow. In the last couple of decades, authors have seen their rights erode even further, despite having started with extremely one-sided agreements.

The Authors Guild has strenuously fought back against some of the unfair terms, such as relatively low ebook and audiobook rates where authors earn only 25% of the publisher’s profits as opposed to approximately 50% of the profits for print, but publishers have refused to budge.

Publishers are finding other ways to cut the amounts they pay authors. Most have started giving major retailers huge discounts, and when they do, the publisher applies a royalty rate as low as half of the normal rate. They also give reduced royalties when they sell through non-traditional outlets for books—even though there is no evidence that they earn less through these growing non-traditional channels. There has also been a surge of publishers paying royalties on “net receipts” instead of a book’s list price (which is half of a traditional royalty) and paying reduced percentages for “bundled” sales, and other cuts to author incomes. At the same time, most publishers have also started demanding audio rights on top of ebook and print book rights.

The Authors Guild has objected to these developments to almost no avail. There is simply no way to fight back when authors are trying to negotiate contracts one by one.

Freelance journalists have seen even more erosion to their rights. In recent years, major U.S. newspapers have started demanding ownership of all rights in articles written for them—but they do not pay extra for those rights. This significantly limits what writers can earn, as they no longer can separately earn revenue from audio (podcast), audiovisual, merchandising, or any other rights. Several years ago, when the Authors Guild asked The New York Times to reconsider its new policy of taking all rights, explaining the enormous harm to writers, it was told in no uncertain terms that the Times could not consider reviewing the policy because taking all rights was now integral to the company’s business model. At the same time, freelancers’ rates have plummeted over the last two decades to a quarter of what they used to be in many cases.

The result is that writing as a profession is in grave danger for all but the top sellers. A 2018 survey of authors by the Authors Guild—the largest survey of writing-related earnings by American authors ever conducted—found that mean author writing incomes were just $20,300, and less than half of that is from their books.More than half (54%) of full-time authors surveyed earned less than the federal poverty threshold of $12,488 from their writing, and an alarming 23% of full-time authors reported earning zero income from books. Literary authors suffered the greatest decline in incomes with a 46% drop in their book-related income in just four years, from 2013 to 2017. This means that many talented writers are no longer entering the profession and many who have written for their livelihood for decades are leaving the field and not writing anymore or as much. It is censorship by impoverishment.

The fundamental cause of this decline is the virtually non-existent bargaining power of writers in the marketplace. As publishers respond to downstream pressures from Amazon—which is squeezing more than its fair share out of the industry—authors are increasingly facing the consequences. Collective bargaining would allow them to say no to certain terms, demand better pay, and boycott bad actors, and in turn put sufficient pressure on the publishing industry as a whole to make the ecosystem work for everyone and not just the big corporations.

Proposed Legislative Solutions

The PRO Act amends the NLRA to provide stronger collective bargaining rights and expand the group of workers who qualify for collective bargaining. The Authors Guild has long lobbied for collective bargaining for freelance writers and creators; and it supports the PRO Act—but with a clarification to ensure that all freelance writers and authors are covered and that they retain their copyrights.

The PRO Act recognizes the fact that many gig workers are independent contractors who lack bargaining power and need collective bargaining. It provides a large group of freelancers with collective bargaining by amending the definition of “employee” in Section 2 of the NLRA. “Employees” (as defined) are given the right under Section 7 of the NLRA “to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection,” as well as the right “to refrain from any or all such activities.”

The PRO Act adds to the NLRA’s definition of “employees” individuals who provide services and fail to meet all three prongs of the ABC test in connection with the services being provided. Or to put it another way, all freelancers who provide services are covered by the NLRA unless they meet all three prongs or the ABC test.[1]

The Authors Guild has proposed adding language to Section 2 of the PRO Act to clarify that the creation of copyrightable content is covered, and that nothing in the Act will affect copyright authorship or ownership.

We have two proposed amendments to the PRO Act below with our added language highlighted in red.

Alternatively, we propose a simple antitrust exemption for writers and artists. A draft antitrust exemption is also attached.

AUTHORS GUILD’S PROPOSAL FOR REVISIONS TO THE PRO ACT

Currently section 2 of the PRO Act says:

(2) EMPLOYEE.—Section 2(3) of the National Labor Relations Act (29 U.S.C. 152(3)) is amended by adding at the end the following: “An individual performing any service shall be considered an employee (except as provided in the previous sentence) and not an independent contractor unless—

  1. the individual is free from control and direction in connection with the performance of the service, both under the contract for the performance of service and in fact;
  2. the service is performed outside the usual course of the business of the employer; and
  3. the individual is customarily engaged in an independently established trade, occupation, profession, or business of the same nature as that involved in the service performed.

Our two alternative proposed additions to section 2 are below:

PROPOSED AMENDMENT 1

Notwithstanding anything else in this section 2(3), an individual performing “creative professional services” (as defined in section 2(15)) shall be considered an employee for purposes of, and solely for purposes of, Title 29, the National Labor Relations Act, and this designation shall not affect copyright authorship or ownership under Title 17, the Copyright Act, nor employee designation under any state law.”

PROFESSIONAL CREATIVE SERVICES. —Section 2 of the National Labor Relations Act (29 U.S.C. 152) is amended by adding at the end the following:

“15. “Professional creative services” means professional services or work product provided, under contract and on a freelance basis for present or future compensation, by any of the following individuals:

                 (a) writers, including authors, playwrights, screenwriters, journalists, copywriters, or digital media writers or creators; 

                 (b) visual artists, including without limitation fine artists, graphic designers, photographers, photojournalists, animators, illustrators, industrial product designers, interior designers, or fashion designers;

              (c) songwriters, composers, or librettists; or

              (d) videographer or filmmaker.”

PROPOSED AMENDMENT 2

As used in this subsection, a “service” may include the creation of copyrightable content, and this designation shall not affect copyright authorship or ownership under Title 17, the Copyright Act.


[1] The ABC test in the PRO Act states:

“An individual performing any service shall be considered an employee (except as provided in the previous sentence) and not an independent contractor unless—

  1. the individual is free from control and direction in connection with the performance of the service, both under the contract for the performance of service and in fact;
  2. the service is performed outside the usual course of the business of the employer; and
  3. the individual is customarily engaged in an independently established trade, occupation, profession, or business of the same nature as that involved in the service performed.”

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