A fellow reader sent an email asking advice about contract negotiations. I’m not an expert on negotiations. However I wanted to post this as a case study of the common tactics used during negotiations. To protect the worker’s identity, let’s call him/her Jamie.
Jamie wanted to break into the VFX industry and agreed to work for a facility that offered no overtime and a 50% paycut with the promise of a promotion to a better position and original salary at a sister facility the following year.
A year passes and Jamie’s contract is up. Jamie is the go-to person when it comes to getting the job done. Jamie feels that nobody can do what Jamie is able to do. The facility looks like it’s ready to offer that promotion, but first they invite Jamie to sign an agreement to a year extension of the current contract. They state that the terms of the promotion and raise will be discussed at the performance review instead.
In my humble opinion Jamie is being royally screwed. There are a lot of old tricks being used that I’ve fallen for before:
A Verbal Contract Isn’t Worth The Paper It’s Written On
This is one of the most common tricks used in the Hollywood industry so it should be no surprise that the quote above is called Goldwyn’s Law of Contracts. It’s named after movie mogul Samuel Goldwyn.
Jamie agreed to take a paycut with the promise of a future promotion. However none of this was in writing. So if the people Jamie made the agreement with break their promise or leave the company, there are no real repercussions.
Thou Shall Not Believe Thine Own Hype
Scott Ross recently wrote a post on what he calls The Eleventh Commandment.
Jamie believed that he/she was good and irreplaceable. Now it’s probably true that Jamie is incredible, but what I’ve found is that’s not what gets the big raise or promotion.
I can tell you of so many occasions where people I consider untouchable would have to leave because and incompetent manager in charge of negotiating their deal had no idea how important that person was. It’s the same story over and over: Management decides to fuck around, the talent leaves, and production realizes we’re screwed.
No Amount Of Loyalty Goes Unpunished
This is sort of a play on the old saying no good deed goes unpunished.
This is sort of unrelated to Jamie’s situation but I’ve seen VFXers make the common mistake of thinking their loyalty to the company will be rewarded. I wrote in a post where a wage survey was done and the artist who had the most years at the company found he was the lowest paid person on the team.
I know artists who were offered much better salaries at other facilities with longer term contracts and turned them down thinking their current employer will reward them if they just stick with them for another project. It rarely happens and the next part is the reason why.
In This Town, Pull Is Everything
Leverage, your ability to pull the other side in a direction that is favorable to you is the ultimate force that will dictate your ability to win a negotiation.
Usually the person with the most amount of leverage is the one who can walk away. Jamie would probably be in a better negotiating position if he/she started pinging other facilities for a position. It’s very likely there would be better offers given that Jamie took a huge paycut. Jamie could then use other offers as leverage against the current employer to deal.
For the most part, in the VFX industry, if you want a significant raise, you are going to have to leave the company you are at. Negotiations are usually a game of brinkmanship that get taken over the edge. When I made that realization, I was able to get a 50% raise in my salary each year over a 4 year period.
If You’re Good At Something Never Do It For Free
The quote above is from The Joker in The Dark Knight. Like Jamie, he claims he can do something nobody else can do: Kill the Batman. The others laugh and ask if it’s so easy why hasn’t he done it? The Joker wittingly responds with a quote in the video above.
Jamie already had experience doing something well and agreed to take a paycut to prove to a new employer that he/she could do it well.
I’ve made a similar mistake. I was asked by an employer to do some important development work that would give me some unique skills that nobody else had. My negotiations were up in a couple of months and I thought it would be a nice feather in my cap.
When it was time to negotiate, management decided to not to offer a raise. I asked that I be taken off the development task since I was doing this extra work with no raise and they refused citing that because I was willing to do it for my current salary, there was no need for the raise. Again, no good deed goes unpunished.
So what did I do? I returned the favor and found a company willing to pay me 25% more and they were left holding the water for the development work. Which leads me to my final piece of advice
Some Employers Thrive On Their Employees’ Benevolence
The mistake I made in the previous situation was that I was reluctant to take advantage of the weak position my employer was in: They needed major work done now and I decided to do the work first and negotiate later. When it was their turn to reciprocate, they took advantage of me and they will take advantage of Jamie’s current situation. We love our industry and the people we work with, but you have to give tough love.
When I started this blog I pondered: Is it better to be feared or respected? What I have learned is that you should earn respect from your fellow co-workers and impose fear against those who try to take it away.
One of the biggest problems in our industry is that VFX facilities do not make a profit. That’s true but that’s not YOUR problem and from what I’ve seen, it doesn’t seem to be the owners’ problem either.
The Smothers Brothers Strause enjoy driving their Lamborghinis, Ferraris, Bentleys, flying private jets, wearing $25,000 watches, and drinking shots of Dom Perignon at Las Vegas clubs with Paris Hilton. But they don’t make a profit!
Luma’s Payam Shohadai was interviewed by the Hollywood Reporter about his new $2.045 Million home purchase in Venice:
There’s definitely a creative class of people and professionals that are making good money, but it feels very nontraditional.
But don’t ask for a raise, they don’t make a profit!
Digital Domain is losing money big time and they certainly don’t make a profit but don’t tell the executives! They are making more money and even sponsor a ballpark to boot! They’re just paper losses!