- Share this article on Facebook
- Share this article on Twitter
- Share this article on Email
- Show additional share options
- Share this article on Print
- Share this article on Comment
- Share this article on Whatsapp
- Share this article on Linkedin
- Share this article on Reddit
- Share this article on Pinit
- Share this article on Tumblr
In the wake of #MeToo, employers across Hollywood turned to morals clauses as an attempt to deter bad behavior. While these provisions have been criticized by talent reps for being too broad and too subjective, there’s actually a bigger problem with their presence in many contracts: They’re prohibited by the directors and writers guilds’ collective bargaining agreements — and they have been for decades.
“The origin was the Red Scare,” says talent lawyer Linda Lichter, explaining that the clauses first became popular when McCarthyism hit Hollywood. “Companies put them in contracts so they could fire people if they were accused of being a Red. They’ve come back in the context of #MeToo.”
The clauses — which use language such as “public disrepute, humiliation, contempt, scandal or ridicule” — essentially mean anything that makes a company look bad could be grounds for immediate termination. Or, as Lichter puts it, “If you don’t behave, we can fire you.”
And, despite the prohibition, they’re ubiquitous in the first draft of agreements, leaving lawyers with an uphill fight to negotiate them out.
“The studios, to the extent they’re asking for these clauses, are flying in the face of their obligations under the guild agreements,” says Peter Nelson, a talent lawyer who reps onscreen and behind-the-camera talent. “Studios don’t always play by the rules they’ve agreed to.”
Adds Nelson, “The business may be operating without knowledge of the protections against morals clauses that the WGA and DGA have built into their [minimum basic agreements] with the studios.”
Part of the issue could be that they’re often not labeled as morals clauses, and instead are integrated into the fine print regarding termination or suspension. Nelson’s colleague Justin Di Stefano notes, “Nine times out of 10 you’ll find the morals clause buried in the boilerplate standard terms attached as an exhibit to the main agreement.”
For actors, there’s no explicit guild protection. SAG-AFTRA’s collective bargaining agreement doesn’t prohibit the clauses. The consensus seems to be that it’s because actors have always been the faces of the projects. (SAG-AFTRA declined to comment.)
“We have many ways we can water them down,” says Nelson. “That negotiation usually starts with a studio clause that on its face is completely subjective and leaves to the studio any interpretation they choose.”
According to attorneys, it’s not uncommon for the first draft of a morals clause to include problematic broad phrases, giving examples like “neglects to govern their conduct with regard to social conventions” or “shocks, insults or offends a substantial portion of the community.”
“Early on with the #MeToo movement we saw companies and brands going very quickly to terminating people, and they wanted to be able to rely on their morals clause to do it,” says entertainment labor lawyer Ivy Kagan Bierman. “In some cases, the clause as drafted didn’t allow it because it had to be proven.”
Kagan Bierman says the language has evolved so companies don’t necessarily have to wait on proof — “There have been tweaks in the language, where it can be alleged to have happened, or believed to have happened” — though she advises her clients to avoid knee-jerk firings.
Di Stefano says the higher the stature of talent, the more willing studios had historically been to make changes to the language, but as of late they’re becoming increasingly resistant. He says, “Across the board, in the wake of #MeToo or just a general cultural shift, studios are more hard-line about making changes to these provisions at all.”
Adds Lichter: “Sometimes they don’t just apply to what you do on that particular job. Sometimes they apply to anything you’ve done in your life that comes to light.”
Talent attorney Mitch Smelkinson says he’s seeing the clauses in most writer, director, producer and actor deals. “They are typically non-negotiable given the climate and times in which we live. There is simply too much at stake from the studios’ perspective,” he says. “I try to address the amorphous and discretionary portions — like the artist being involved in a situation that subjects the artist to ridicule or scandal, or likely to shock or offend the community, or reflects unfavorably on the studio — most of which is purely subjective, usually without much success. The studios’ remedies are catastrophic, such as termination or losing credit, subject to guild protection, if any. It’s not a comfortable place to be, but we’re all now learning to live with it.”
Lawyers single out Disney as especially aggressive on this front.
“In general, we find that Disney is the most protective of this type of language,” says Di Stefano. “They’re so well known for family content — maybe more so than any other studio — that maintaining restrictive moral clauses gives the studio more flexibility to suspend or terminate talent whose public actions are inconsistent with the Disney brand.”
Disney declined to comment on the criticism of the company or the clauses themselves. Talent lawyer Jamie Mandelbaum noted several provisions, unique to different divisions of the megastudio, that he finds problematic.
“20th TV and ABC Signature, for instance, very recently introduced a new version of their morals provision with even broader language in favor of the studio, and we haven’t seen them change a word of it,” says Mandelbaum. “The new language allows the studio to terminate for any act or omission that ‘could’ cause Disney to incur public disrepute or ‘may’ cause offense to the community or any substantial group thereof. That language causes concern for us and for many of our clients in marginalized groups and/or politically active clients — clients that engage in behavior that could be offensive to certain social conservatives, definitely a ‘substantial’ group in our country. It is hard to believe that Disney, or any major corporation, would enforce the contract in that way from a PR perspective, but asking clients to sign a contract allowing Disney to be the arbiter of morals is problematic for obvious reasons.”
Another younger-skewing division even limits the kinds of outside projects its talent can sign on to.
“Disney Branded Television, the unit responsible for programming aimed at kids, teens and families, uses a provision in its talent contracts prohibiting the talent from participating in content for third parties which is inconsistent in ‘content, taste and sensibilities with the traditional and family-oriented values’ of the applicable Disney branded telecaster,” says Mandelbaum. “It’s broad and concerning when one contemplates clients exercising creative freedom in choosing their projects outside their Disney engagement.”
When it comes to writers and directors, the enforceability of contracts containing morals clauses hasn’t been tested in open court. If such a situation were to arise, it could put the guilds in a tricky place, optics-wise. “If someone is accused of egregious conduct, it might be difficult for the DGA or WGA to oppose what the company is doing,” says Kagan Bierman.
But both guilds seem confident they’re on the right side of the issue.
“This was a hard-fought gain that prohibits the blacklisting of directors for their personal and political beliefs, as occurred in the 1950s,” says a DGA spokesperson. “If a member’s personal services agreement (PSA) includes a morals clause, it violates our contracts and is unenforceable.”
Adds a rep for the WGA, “Because the collective bargaining agreement takes precedence, such a clause would be invalid even if a writer agreed to it in an employment contract. While the topic has come up a few times over the years, it has not been a persistent enforcement issue for the Guild.”
Nelson notes both the DGA and WGA collective bargaining agreements expire in 2023 — and he expects this to be a point of contention.
“When the WGA and DGA minimum basic agreements are renegotiated, I’m sure the studios will take a shot at removing the prohibition against morals clauses,” says Nelson. “Those negotiations start out with each side having 20 or 30 improvements it would like to make. Each party will achieve some and let others go. The prohibition against morals clauses would be a scary one for the guilds to let go.”
A version of this story first appeared in the Sept. 28 issue of The Hollywood Reporter magazine. Click here to subscribe.
Sign up for THR news straight to your inbox every day