New Zealand to Revise, Not Repeal, Anti-Union Law in Coda to 2010 "Hobbit Crisis"

Warner Bros. Entertainment Inc.
'The Hobbit: The Battle of Five Armies'

The compromise is a backtrack for the Labour government but creates a novel framework that will allow independent contractors to collectively bargain.

Elections have consequences, but it’s not always that simple: New Zealand’s Labour-led government said on June 13 that it has decided to revise — rather than repeal, as previously promised — the country’s so-called “Hobbit law” that effectively bars film workers from unionizing by categorizing them as independent contractors rather than employees.

In a novel framework, that default categorization will be retained, but independent contractors in film will be allowed to collectively bargain, something not otherwise allowed in New Zealand — nor in the U.S., where employment status determines the right to collective bargaining and unionization. But under the proposal, Kiwi contractors won’t be allowed to strike, depriving them of leverage often seen as essential to achieving gains in wages and working conditions.

“This model will deliver workplace rights to more workers than a straight repeal of the ‘Hobbit law’ would have,” said Workplace Relations and Safety Minister Iain Lees-Galloway in a statement. “Instead we are ensuring more workers gain workplace protections, while providing certainty and flexibility for our internationally competitive screen sector. This is a win-win solution that demonstrates the value of the Government’s collaborative approach to building a productive, sustainable and inclusive economy.”

The new compromise, which was proposed by a committee comprised of labor and management representatives, comes despite Labour’s straight-line vote in 2010 against the statute introduced at Hobbit producer Warner Bros.’ insistence by the then center-right government. The party continued to campaign against the statute in the following years, and when a Labour-led government wrested power in October 2017 from the economically conservative National Party, Lees-Galloway told The Hollywood Reporter that the statute would be on its way out within 100 days.

But it turns out that you can’t always unscramble an egg, regardless of election results. Within days of that promise, the new government came under pressure to reconsider from local industry leaders fearful of losing Hollywood productions, which remain a booming business for the country (even though the forthcoming Amazon Lord of the Rings series has reportedly chosen Scotland as its production site). And so the government did what governments do: it established a committee, called the Film Industry Working Group, and slow-walked the whole matter.

A year later, the FIWG issued a 22-page report. The October 2018 document, complete with color-coded flowcharts, was taken under advisement by the government. Eight months of silence ensued, until the June 13 announcement that the government was adopting most of the recommendations from the group. Legislation will follow, with passage expected in mid-2020, according to a government press release.

That slow-boat approach stands in marked contrast to the drama in 2010, in which a “do not work” order issued by an international federation of actors union against The Hobbit led to a threat by Warners to pull the project from New Zealand. A six-week crisis ensued, with “save the Hobbit” street protests in cities up and down the country and daily media appearances by the prime minister and key deputies. The affair culminated in a visit by Warners executives and an extraordinary two-day legislative process that saw the controversial Hobbit law rammed through Parliament on a party-line vote.