When you sit down to negotiate whether it's over a union contract, a business transaction or a marriage proposal you must have leverage.

It can be the threat of a strike, the promise to pay more money, or a plausible bluff. Regardless, if you don't have some leverage some weapon sitting beside you on the table you're gonna get rolled.

I bring this up because of the perplexing way the Screen Actors Guild gave away its leverage over the last year or so, but kept acting as if it had plenty.

Sure enough, the actors union got rolled. The proof came out about a week ago when the guild's divided board voted 53 percent to 47 percent to recommend basically the same contract that the board turned down last year.

SAG's sad turn came more than a year ago when so-called hard-liners on the guild's board forced a parting of the ways with its smaller sister, the American Federation of Television and Radio Artists. The two talent guilds historically sat together when they began negotiating with the major studios for a new film and television contract.

When the two worked together, they had leverage. But split apart, they became the proverbial house divided. After the split, AFTRA wisely negotiated its own contract with the studios. And the studios wisely played the two unions against each other.

"In July, there was really nothing left of SAG's negotiating position," said Jonathan Handel, an L.A. entertainment lawyer who blogs about the negotiations.

Amazingly, SAG continued to deleverage its position. Rather than try to bring AFTRA back into the fold, SAG leaders campaigned against the AFTRA deal, which drove AFTRA deeper into the arms of the studios. Jobs on television pilots, which historically have gone mostly to SAG members, now are going almost exclusively to AFTRA members.

One point the hard-liners make is that the proposed contract essentially would allow studios to rush shows to the Internet and thereby shred residual payments to actors or bypass union actors entirely. They liken it to the situation 25 years ago when they failed to get what for them would have been a good contract for home videos.

I'm no expert, but that issue appears to be a real concern for the union. Even if they have a legitimate complaint, it doesn't much matter. What does matter is that the union has lost its leverage. The gunfighter who surrendered his pistols at the barroom door should not pick a fight.

SAG's best course would be accept the contract, warts and all, and focus on the next contract that is to begin in two years. The beginning of the next contract coincides with the beginning of contracts for AFTRA and two other Hollywood unions. In fact, SAG's biggest victory was to get its next contract to begin in synch with the others'. If SAG would get on board with the other guilds, and work with them, its leverage would be restored.

But, alas, the hard-line faction in SAG is lobbying to have the members vote down the contract. They could, in fact, get it killed. That would further mess up the works and hurt L.A.'s signature industry at a time, ironically, when it should be doing reasonably well, considering the good movie attendance numbers. That's entertainment.

Charles Crumpley is editor of the Business Journal. He can be reached at

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