VFX Union Meeting For Hydraulx Employees

One of the worst kept secrets in the VFX industry is that the IATSE has been meeting with VFX artists at various facilities. I thought I’d take the opportunity to get everyone to spread the word about this meeting:

Representatives from the IATSE are planning a meeting of employees from Hydraulx

Thursday, December 9, at 7:30pm

O’Briens Bar and Restaurant on Main Street in Santa Monica.

vfx@iatse-intl.org

Reps from the IA, (who have been holding meetings with employees from several VFX companies), will be present to answer questions and disseminate information regarding their interest in representing VFX artists throughout the industry.

I know many of you are shocked to hear that. Why would anyone want to unionize one of the best vfx companies on the face of the earth?

The reason why I am compelled to bring this up is because one of the owners of Hydraulx may have commented on my Skyline article. I hope (and pray) that this is some sort of fake because if it really is a comment from a VFX facility owner, then we have got some major issues. I’ve reposted the comment from here:

What is the 1099 scam you guys keep talking of?  U act likely the artists don’t want to manage their own taxes as contractors.  If u know what u are doing, U can the money go further. It seems there is some fallacy that hydraulx forces artists to this. That’s bs, and doesn’t make sense.  Why would they care?  Taxes either come out up front (employee) or later (contractor).  It seems to me that the real scam is contractors realizing they owe a lot in taxes, getting mad about the situation (of their own creation I might add), and then trying to argue that they were employees, in which the state assumes the burden is on the company, not the contractor.   It’s basically equates to people changing their deal so the tax burden falls on the bigger company, even if this is contrary to what was agreed upon.  Human nature seems to be to forget the truth when it benefits them.  And human nature is for flame artists getting paid $120/hr to complain about getting clocked out when they are on
personal phone calls for forty mins , and to post that they were clocked out when they visited the bathroom.  All of those who spend so much time trying to unionize the vfx industry should wake up and drop it.  It will be the end.  As people have posted, hydraulx paid full rates and paid everyone ot in accordance with state law for skyline, and all projects that matter. If you want to improve your pay, fight the illegal subsidies that other states and countries are offering the studios to take our jobs from us.  It is THE issue facing the industry.  Tax incentives are an evil, illegal Practice that we must stop.

Seriously? I’m trying so hard not to lose my patience after reading that.

Let me address the 1099 scam because it is a scam. Artists aren’t “choosing” to be independent contractors, the employers are. Why? Because they don’t have to pay their side of payroll taxes!

For example, if you are correctly classified as an employee, you will pay 6% of your salary into social security, and your employer must do the same. By making an employee an independent contracter, the employers gets to skip out on that and make the employee responsible for 12% of social security taxes!

Then this owner has the audacity to accuse an artist of engaging in a scam for reporting it to the state? This is just bad. I know many 1099 VFX artists who have been audited and dinged very badly by being misclassified.

What irritates me is the next statement: Human nature seems to be to forget the truth when it benefits them.

That’s very true for the owner here. The truth is there are artists at Hydraulx that are paid overtime after 50 hours a week. That’s against the law and it’s the truth along with the 1099 situation that conveniently gets forgotten. Afterall, it only benefits the owner.

But don’t blame us, the owner says, it’s those illegal overseas subsidies that need to be stopped! The chutzpah of such a statement is jaw dropping. You now want us to go after illegal trade subsidies while admitting to breaking labor laws yourself? Shame on you.

All of those who spend so much time trying to unionize the vfx industry should wake up and drop it.  It will be the end.

That’s an ironic thing to say. Afterall, human nature seems to forget the truth when it benefits them right? Like how the Strause Brothers are receiving residuals and benefits by being members of the Directors Guild of America? You can search for them right here.

I’m reminded of a quote from Leslie Nielsen who passed away this week:

Truth hurts. Maybe not as much as jumping on a bicycle with the seat missing, but it hurts.

Soldier On.

22 Responses to VFX Union Meeting For Hydraulx Employees

  1. Rolling Red says:

    To continue with vfxsoldiers aphorisms🙂 here is one I like and just recently picked up: No hay cabrón sin pendejo, or: “In other words, the person who is taking advantage needs the fool as counterpart”. Wake up my darling peers, coworkers brothers and sisters, get informed and educated about labor laws and your rights – and most of all – stop giving ass.

  2. […] and found the 25 or so artists who attended very interested in information. VFX Soldier has an interesting post about an upcoming (Dec. 9) meeting for Hydraulx employees that includes a comment he got on his […]

  3. Tom says:

    Anytime I have moved, I always, ALWAYS, Check the State and Local labor laws. Its in your best interest to protect yourself.

    For example, when reading I found that California has minimum wages for certain fields where people have Masters or even Bachelors degrees. Lots of companies get around this by hiring employees as contractors.

    And even as a contractor, there are “some” guidelines either the “company” has setup or state/local government might have setup. These guidelines say you can only be a contractor for a period of time before the company “must” hire its work force as employees.

    Its always a good idea to be well informed. If you don’t know what the law is stating. Contact a lawyer. Many organizations and maybe your own company have services where you can talk to a lawyer about almost anything in the law.

    Here are the sites I used when I moved to California.

    http://www.dir.ca.gov/DLSE/dlse.html
    http://www.dol.gov/

    When searching google for this stuff, don’t trust any site that is not linked or blessed by the federal government. Some sites might say add .com to end something like this: .gov.com, this is not a real site, ignore it.

    Always look for “gov” at the end of the address. Most, if not all government sites link to just about every other part of the government.

    If you are not sure, goto:
    http://www.usa.gov

    If you cant find the site you found in google linked somewhere on usa.gov. It is most-likely a scam site trying to get your money, or even worse steal your identity.

    I had a friend who thought they could get a “green-card” for $200 because of one of these “fake” sites saying they can provide guaranteed green card lottery winners. You have been warned…

    Tom

  4. Tyler says:

    Not defending the subject of the post, but that could just as easily be a supervisor or mid-level manager venting rather than an owner. Of course it could be an owner too, just saying we can’t jump to conclusions.

    • Bukka Bukka Beer Neer says:

      not sure it matters if it’s a mid-level manager. it’s the statements that matter.

      • Tyler says:

        But it most certainly DOES matter who said it. If a facility is going to be held responsible for the comments of an individual who happens to work there, that is only fair if the person actually represents the facility at a senior level. There’s a lot of people who work at the company in question – a company I have zero ties to, BTW – and any one of them could say something stupid or inappropriate without the owners having any control over that. Just painting them with the same brush – guilty by association, without knowing who said it and their relationship to the company and the worker – would be irresponsible. Besides, this is heresy and taken out of context. I’m not saying the company is spotless here, I’m saying we have not enough information.

        On another note, Bukka Bukkka Beer Neer, you’re coming to the thread 10 months late with a fake name.

  5. Dave says:

    “The truth is there are artists at Hydraulx that are paid overtime after 50 hours a week. ”

    That may have been the case years ago, but when I was there a year+ ago. I also asked a few people and they told me they were paid normally, per the law. I was 1099 per choice and it did benefit me I made more, and was able to write off more. I don’t think “Owner” is wrong in this statement.
    You’re being aggressive saying they’re breaking the law but unless you work there I’m pretty sure you’re wrong. They may be “assholes” but they’re not breaking the law.
    Also going after subsidies IS a huge factor so he’s not wrong there again.

    • vfxsoldier says:

      I’ve written on the legality of foreign film subsidies and agree.

      You may not think misclassification isn’t against the law. However if you end up like a few artists I know that get audited, I suspect you might feel different about the issue.

    • Winston Smith says:

      Dear Dave

      “That may have been the case years ago, but when I was there a year+ ago. I also asked a few people and they told me they were paid normally, per the law. I was 1099 per choice…”

      Actually Dave, your statement is more evidence that they are in fact misclassifying employees as independent contractors. You state that other vfx workers were being paid “normally, per the law” – I assume that you mean that they were paid as employees, and I assume that you mean that other vfx workers were being paid as independent contractors. The problem is that the vfx workers are doing the same work, under the same conditions, under the same terms of “control”. You and/or the company do not get to decide whether you are an employee or an independent contractor, State and Federal law determine that. You cannot be “1099 by choice” unless you are legally, as defined by statute, actually an independent contractor. And that has nothing to do with being incorporated or an LLC. Check-out these links for more info:

      http://www.dir.ca.gov/dlse/FAQ_IndependentContractor.htm
      http://www.irs.gov/businesses/small/article/0,,id=99921,00.html

  6. B says:

    First I love the blog, hope to see many more post in the future.

    I’d like to clarify the post comment submitted by the “VFX facility owner” a bit.

    I think you both touched on some of the problems with 1099s, but failed to put the to haves of the pie together. As the owner of a small, very small, boutique VFX company in LA I offer our artists the choice of employment or 1099. We do this mainly because we only hire on a per project basis as there simply is no way we can be competitive and cary a full-time crew.

    Anyway, back to the issue. For my little studio there is NO difference between what is payed in taxes/ss/unemployment/ect between a 1099 contractor or employee, only who pays it.

    For each position I hire I have X amount of money. This amount doesn’t change regardless of employment status. Its a pool of money that has been allocated per the project bid.

    If an artist wants to be 1099 they can receive a larger hourly rate than if they are an employee. This is because the taxes/ss/unemployment/ect the company is responsible for when hiring an employee is calculated into the allocated pool of money X, therefore lowering the max ceiling for hourly rate I can afforded to offer. The 1099 artist, although the hourly rate is higher, will actually make roughly the same rate hourly when all is said and done with Uncle Sam because they are now responsible for those taxes.

    I think what the “VFX facility owner” was trying to say in “equates to people changing their deal” is that the hourly rate the artist was receiving and agreed to upon hiring would not have been the same rate if they were hired as an employee rather than 1099. Thus there was some manipulation of their rate though claiming to be an employee and shifting the tax burden.

    For me its all about communication. If an artist is going to be 1099 they need to be aware that they are responsible for their tax responsibilities. Ideally, if an artist wishes to be an independent contractor they should form an LLC or S-Corp and issue invoices though that entity.

    • Winston Smith says:

      Dear B

      Unfortunately, you are clearly ignorant of California State and Federal labor and tax laws regarding classification of your workers as employees or independent contractors. The company and/or the worker do not decide if this is to be their business relationship – the various relevant State and Federal government enforcement agencies decide. Period. But of course don’t take my word on this, I strongly suggest that you consult your business legal consul and/or contact the relevant government agencies directly. You can start by searching their websites for info – try these, read them, and please post a reply:

      http://www.dir.ca.gov/dlse/FAQ_IndependentContractor.htm
      http://www.irs.gov/businesses/small/article/0,,id=99921,00.html

      Here’s another informative article:

      http://www.fxguide.com/article648.html

      In general, there is virtually zero chance that any VFX artist, even a highly paid senior flame artist, is a valid independent contractor. You need to understand that getting this wrong is a problem that can shut down your business and expose you personally to some serious financial and even criminal penalties. Be smart – go consult an attorney on this. And don’t post what you do on-line (even anonymously), it’s basically a confession that you are openly and knowingly violating the law.

  7. […] It’s not going to come from facility owners either. Hell, with responses from facility owners like this, the message should be abundantly […]

  8. B says:

    “The company and/or the worker do not decide if this is to be their business relationship – the various relevant State and Federal government enforcement agencies decide. Period.

    No, not period. The nature for the work/supervision determines who can or cannot be classified as an independent contractor. The state and Federal government simply classify the worker based on the nature of that work/supervision.

    Your making a pretty big assumption that that artist who choose 1099 or choose to be employees work under the same set of constraints. Which at least for us is not the case. For example artist who choose to work under 1099 typically work out side the office where employees are required to work on site.

    • Winston Smith says:

      There are many state and federal factors that determine whether a worker is an employee or an independent contractor. Where there is any question of classification, the relevant government agencies have the sole discretion to make the determination. NOT the worker. NOT the employer. Period.

      My assertion that most vfx artists should almost always be classified as employees is based upon my personal experience and observation, as well as the experiences and observations of pretty much everyone whom I personally know who works in the vfx biz. I do know some who have worked as legitimate independent contractors.

      An artist working on or off-site is not in itself a determining factor in regards to proper classification. Perhaps more important factors are whether or not the artist is doing work that is an integral part of your business and if you have the right to control how the work is done. If both of these are true, then that artist is more likely to be an employee than an independent contractor. But again, that is not for you and the artist to decide.

      I strongly suggest that you refer to the links in my previous post and review this issue with an attorney who has experience with labor issues. Can you at least acknowledge whether or not you have talked to an attorney about this topic? My information comes directly from an attorney who was recently the chief consul for the EDD in California.

  9. […] avoid paying taxes by misclassifying ourselves as independent contractors or give up overtime like Hydraulx proudly […]

  10. henry says:

    I’m wondering if the artists signed an independent contractor agreement. If they did and worked under much more freedom than regular employees, they should not claim as employees later. The government agencies are supposed to take these factors into consideration seriously.

    • VFX Soldier says:

      Ita not up to the employee or the employer to choose to be 1099. If anything the govt should be cracking down on this since it’s illegal.

      If it was legal, why aren’t the big facilities doing it? Because it’s illegal.

  11. […] got caught and they didn’t even get punished. Joe used to work at Hydraulx and it’s known they don’t appropriately pay OT and misclassify workers as independent contractors. Did you call the CA DOL about that Joe? Why […]

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