VFX Union Picnic in Santa Monica

At the request of artists on both sides of the border, the IATSE union in Los Angeles and Vancouver will be hosting informational meetings on Sunday February 13. The IA, in sunny Southern California, are hosting an informational picnic in Santa Monica, whereas here in Vancouver with a decidedly cooler clime, IATSE 891′s informational meeting will be held at the Shebeen. This is an opportunity to chat with your fellow artists, compare working conditions, and ask the questions you want answered of the union about the organizing drive, the benefits of a union, employment classifications, etc. Bring along your colleagues, enjoy some food in a relaxed casual atmosphere, and most importantly bring your questions!

Vancouver:
The Shebeen in the back of the Irish Heather on Carroll Street
February 13, 12.00pm

Los Angeles:
Dorothy Green Park, Santa Monica

What if VFX Facilities Didn't Exist?

A friend and I were discussing the future of VFX today.  To be honest, I haven't thought about animation much over the holiday.  I have been enjoying the time off and time to sleep and hibernate.  But... I go back into the big machine next Monday and with the news of another studio closing on the heels of the Asylum FX announcement - this is weighing on my mind again.  "Bye bye" vacation - back to reality.

My colleague started talking about unions and I argued: "A union at this point will only help a symptom - not the disease.  A biz model based on undercutting the competition until you are working with a budget that equals bone and ligament cannot survive for long.  VFX studios are so poorly managed and they have backed themselves into a corner where they have absolutely no position to negotiate.  To underbid a show simply to get work into the studio is not a good idea.  On top of this... the VFX studios cannot agree to organize themselves into any type of group that could lobby with the production studios for better budgets trickling down better wages and working conditions for artists."

Then, he said - "What if artists worked directly for the Production studios like everyone else?"  After our chat, I am convinced that the only way to save the VFX biz model is to start over completely and eliminate the VFX studios entirely.   Why not go back to square one and work directly with the studios on the lot?  Like all of the other production for movies is handled?  At first, I told my buddy, "...that can't work because the VFX pipeline is so different than live action."  But, maybe not?  Maybe that is the problem?  The current VFX biz model doesn't work, so why would we try to replicate it on the lot.  Maybe a new approach is a good one?  So much has changed technically in how we create animation and VFX with computers today, that maybe we need to rebuild?

Here are a couple articles discussing this issue:

Rough Times for VFX

Another VFX Business Model

What Purpose Do VFX facilities Serve?

talk amongst yourselves.

RSA Animate - Smile or Die

I love the animated talks by the Royal Society for the Encouragement of Arts, RSA 

It is not easy to create animation that is both 

entertaining and educating at the same time. 

I posted this back in August, but I think it needs a repost to remind us.

The content here seemed very timely.

Smile or Die

I dedicate this post to all of my colleagues who are out of work and/or have been out of work for almost a year now. I remember 2007 being the first year studios did not pay me on time and it was devastating.  Little did I know this was just the beginning.

Barbara Ehrenreich's take of positive thinking in the above video, resonated with me. I experienced this very thing over and over in the workplace over the years. If you pipe up that a project might not meet a deadline or that there is something wrong with the rigs, more times than not you would get a wrist slap or worse. So, I learned to carefully picked my battles.  The "yes" man philosophy has infiltrated the animation halls which is so surprising since being a "yes man" goes against the very nature of being an artist..  Sooooooo many seasoned animators are out of work because they are deemed difficult to work with or expensive. Here is what I say...

Forget "the Secret" and the philosophy of trying to bring the things that you want to you through positive thinking.  Use reality and logic and determine what path is best for you at this time in your life. Some of you may see animation as your final path no matter what,  even in light of runaway production and the loss of jobs to overseas studios. Great! Now decide if animation in the context of working for a studio is the only way you can make a living.

I believe we attract what we ARE, not what we think. If we wallow and say we ARE unemployable, then our actions will follow that reality and we will not look for work... or we become increasingly frustrated as we do look for work and run into obstacles. Instead, I offer this.

Maybe you ARE employable, but in a different way? Animation doesn't have to just be movies. There are commercials, games, R & D at virtual labs, software, consulting, teaching, etc. And, that is just a list of things you could participate in that are squarely using animation skills. Who are you? Are you an Artist? A Designer? A Technical Madman with a mouse? A programmer? There are many ways to see a new path using all of these skills outside of working in animation too!

I hope this posting helps some people who have been feeling really down about the future of animation.  I don't think it will ever return to what it was in the mid '90's, but once one of these overseas studios miss a deadline... I am pretty sure some work will return to the talent pool in Los Angeles.  For now, keep on trucking.

Scott Ross for President

Everyone should listen to this interview...

Interview with Scott Ross

This is the most articulate, solution oriented conversation I have heard yet on this subject.  If the VFX shops are awarded the money, respect, education, and deserved appreciation Ross proposes a trade organization would provide... I am confident there would be trickle down to the employees.  Ten years ago, these needs (401k, benefits, fair hiring practices) were being met.  Some shops back in the day even had car washing, dry cleaning services, meals provided, studio sponsored parties, etc.  VFX shops managed to provide these things to artists even on a "next to nothing" profit margin.  Then, times changed.  The movie studios told shops you have half the budget , twice the work, and half the time... even though profits on VFX driven films are higher than ever.  Studios told the shops, if you don't like it, the shop down the street beet your bid by 150k!  So, the VFX shops began to hire cheap labor just to make ends meet.

The VFX companies are not the enemy in this situation and the situation is not personal.  What have we got to lose?  If the shops don't organize and fix the situation now, they are out of business anyways.  Then, no one has a job. If the VFX shops paid dues to a trade organization like artists do to the VES, we might get somewhere.  As long as the new trade organization does the job presented to them and isn't fluff and just talk, like some organizations we know.  I think this is what Scott means by he would be willing to help organize as long as people made a commitment to the mission.  If shops all agreed to pay dues to get the organization started, they might have a fighting chance in this as Ross put it "race to the bottom."

I also agree completely with Ross on a Union.  The biz model for VFX shops is not one that could work with a Union. at this time  The issues that artists have with the shops  (401k, benefits, fair hiring practices) are only symptoms of the bigger problem.  VFX was never working off of fat, it was lean muscle ten years ago... now we are cutting ligaments and bone as far as budgets and any profits.  There is no room for negotiating.  A union could help after we recover from the current circumstances... possibly, but I do not see how a Union would fix the profit margin issue between the Movie Studios and FX shops.  How would a union deal with Runaway Production.  I am curious how are they handling it now?  I am pretty sure 2D ran away to Korea... no?

The one thing that did bother me in their talk was when they said the whole issue since the town hall "died because people are working."  I know more people out of work than ever.  Artists have no power, no money, no leaders, no experience in this stuff and mouths to feed.  We feel helpless.  That is why it died.  If the VFX studios have no cash, you think out of work artists do?  So, artists go overseas to help the lack of local talent for 1/3rd of their salary on even smaller budgeted movies and leave their wife and kids behind to keep a roof over their heads.  It's the unskilled talent pool overseas that needs our artists to make the incentive program work.  Again, worst biz model ever.  And I digress..  Anyways, it's the first real discussion I have seen anywhere so far.

Media industry fears new rules will kill jobs

This is the first article I have seen regarding runaway production in Animation and VFX that makes any sense to me.  If you are trying to build an industry in a region and expect incentives from the government, it shouldn't be easy to import temporary workers to do the work.  You should have to hire the local talent.  Of course, the real talent doesn't live there, so you look for loopholes to import people from the states to do the work.  Looks like those days of easy imported talent might be numbered for Canada.

Media industry fears new rules will kill jobs

"Without the IT category, Pixar, Digital Domain, Ubisoft and the like will, starting in October, have to apply for temporary work visas the way every other company in any industry does. This means first seeking a so-called Labour Market Opinion (LMO) from Ottawa's Service Canada department. It requires demonstrating that a position meets wage guidelines, brings new skills and knowledge, and does not adversely affect the employment of a Canadian worker."

Read more: http://www.vancouversun.com/Media+industry+fears+rules+will+kill+jobs/3236518/story.html#ixzz0t2xnX700

VFX Soldier

VFX Soldier

Check it out.

I enjoyed the comments section.

Deconstruction EORS

Great Explanation of EOR and Freelancing

 Bottom Line:  

Got a problem with the shady EORS like MBO and Yurcor?

File a complaint with the labor board.

Hollywood's VFX Sweatshops

"Fundamentally, visual effects is a crappy business," James Cameron told me when I interviewed him for my book, The Futurist: The Life and Films of James Cameron. "You don't make much of a margin. A good year for us was 5%. Sure, we were doing huge volume but at a low margin." In 1998, after the VFX company he helped start, Digital Domain, won an Academy Award for its groundbreaking work on Titanic, Cameron resigned amid dispute about its direction.

 For VFX houses, there may be a dramatic Hollywood ending. With effects-heavy movies like the forthcoming Batman sequel, The Hobbit, Thor and Green Lantern coming down the pike, the demand for VFX may overwhelm the industry's diminished capacity. The changing nature of the work could alter the balance of power too: being a gifted designer is becoming more important than being a technical whiz. Says analyst Alan Lasky: "The minute you see one of these movies not make its release date due to this capacity crisis, then you'll start to see some interesting changes in the industry." Who knows? Maybe someday an effects artist will even get star billing.


...excerpts above from article in Time Magazine

Read more: Hollywood's VFX Sweatshops - Time Magazine

Cash Money

It's so nice to get a paycheck from an employer - 

on time and without hounding them!  

This should be the standard, but it's not anymore.

Since 2007, myself and most freelancers have experienced changes in treatment of employees and disinterest in paying people on time.  Common replies to inquiries about paychecks are:

"You will be paid when I am paid." 

"Did you submit a timecard?"

"We cannot find your invoice, you will have to resubmit."

"The checks did not arrive today."

I never had to worry about simply being paid just a few years ago.  Below, are some questions I recommend all artists ask when negotiating the statement of work with prospective employers.  Good luck and get it all in writing because the person you spoke to might not work there anymore, by the time you are due a check.

Start Date

End Date

Possible Hold Dates

Rate 

(Hourly plus OT defined specifically in writing.  I advise against agreeing to day rates because studios will pro rate the day rate against OT to make it legal and you will be making a fraction of what you think you are)

Pay Schedule - when will you be paid?

How will I be paid during a holiday - Arrangements for payment when office might be closed

Invoice/Timesheet Deadlines

Contact Info - Name and email of Bookkeeper/Accountant

It's also good to memorize the California State Work Policy in case a studio is asking you to wait 30-45 day for a paycheck because it's against the law.  .

In California, wages, must be paid at least twice during each calendar month on the days designated in advance as regular paydays. The employer must establish a regular payday and is required to post a notice that shows the day, time and location of payment. Labor Code Section 207 Wages earned between the 1^st and 15^th days, inclusive, of any calendar month must be paid no later than the 26^th day of the month during which the labor was performed, and wages earned between the 16^th and last day of the month must be paid by the 10^th day of the following month. Other payroll periods such as weekly, biweekly (every two weeks) or semimonthly (twice per month) when the earning period is something other than between the 1^st and 15^th, and 16^th and last day of the month, must be paid within seven calendar days of the end of the payroll period within which the wages were earned.

Effects Corner POV

I keep hearing "All of a sudden. the folks making VFX have grown up.  Now they are concerned about their families and want stability.  This is why the issues about pay and hours are now important to the workforce."  Poppycock. Yeah, I said poppy cock.  I worked with men who were in their 30's and up when I started in Animation and VFX in the early 90's.  They were happy.  They had resonable schedules, decent pay, comfortable hours (with the occasional push) and most owned houses even in LA's real estate market because of their stability.

Today, facilities are telling the supervisors they have one day to get a shot done that would have been bid at 5 day just a few years ago.  On top of that, budgets force the producers to assign cheap labor instead of seasoned professionals to these shots.

Scott Squires has been around the block.  His career dates back to creating the clouds for Close Encounters of the Third Kind.  He has a blog that everyone should be reading.  I placed some favorite excepts below concerning the recent events regarding labor issues and the future of the VFX Industry, but I also encourage you to go through his blog archive posts.  His blog should be required reading for every artist and TD working in Animation and VFX.

Effects Corner Blog
You can also follow him on Twitter

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Excerpt from this posting: Response

"The VFX industry is like a tire that has gotten out of alignment and is getting more out of balance all the time. Toward the end of the optical era and the beginning of the digital age most projects ran reasonably smoothly, at least at ILM. There was still the sprint at the very end but it wasn’t super crazy. ILM was powerful enough to let the studios know how much time was involved.

With film you had to make sure you finished your shot in time to make the lab run. Once you made the lab run at 7pm or 8pm that was it. That was the end of the day for most vfx artists. Working after that cut off time was only worth it if there was a late lab run, which was only arranged in the final sprint. The next morning you’d see the dailies and would reshoot. Even if it was a small change you’d still have to wait until the next morning unless you sent the film as a daylight run (more expense). When digital came in, the render took the place of the lab run. Sometimes it took longer time to render than to process the film. You’d get your render prepped for 7pm or so and the CG supe would allocate procs in the render farm. And you still have dailies in the mornings. However now it was possible to actually see composites and other things during the day so turn around time for some tasks was much less. As computers became faster the internal deadlines became more flexible.

Certainly in the early days of digital the studios would at least discuss how much time would be required to do the vfx for a large film. The studios would use that information to determine the release date. As more projects were being done digitally the studios realized how much flexibility was available. Both studios and directors started pushing the limits not just creatively but technically and time wise. And we, the eager and hard working vfx artists, jumped to meet those goals. While we were wiping our brows afterwards, amazed at what we had accomplished, the studios and directors now used this as the new standard. Directors on their next show would say, 'You guys say you need clean plates and markers. But remember that last film where we had one shot that we didn’t do any of that and you still made it work? Well that’s what we’ll do for all these shots. That was much faster and easier to shoot'. The studios were now saying 'You did the last project in 6 months and we made changes two weeks before the release and you still did it. This time you’ll have 4 months and we’ll be making changes 1 week from release.' Some of them like to brag about this type of thing."

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Excerpt from this posting: VFX Service - The Big Picture

"When I think of a service I think of a dentist, a car shop where they work on your car or a plumber that comes to your house. In these cases they do work but don’t tend to produce anything. The costs are based on time and materials.
Custom manufacturing?
Should vfx be considered as custom manufacturing? We actually create something when we finish our work, whether it’s from scratch or a montage of material provided. That’s what the studios want, not the actual service part.

Here is where things get crazier. Each shot is unique like a snowflake. It’s own little world of issues, handwork and tweaks. You try like anything to make shots as consistent as possible and to be able to run them through the exact same process but it’s never full automated. For all the talk about computers in our business it’s still a very labor-intensive process. The number of people and the time required to do a shot from start to finish would astound most outsiders.
If you go to most manufactures and request custom work you will be required to make specific requirements in writing. (I.e. you want cabinet style 32 but in this specific color of blue. You want a custom cake that says Happy Birthday. It will be yellow cake with vanilla ice cream and chocolate frosting.) And that is what you will get. They seldom show you the work in progress or have your input at every single stage. The other thing is a custom manufacture will tell you when it will be done. They dictate the schedule. In the film business it’s the opposite of all of this. The studio specifies when the delivery will be. It’s almost always less than the time that would have been arrived at by a normal scheduling process for the facility."

More interesting highlight posts by Scott Squires:

Unions

Budgeting VFX

VFX Service - The Big Picture

VFX Town Hall Brought to you by ARTISTS

Give a listen to a town hall created by working ARTISTS

No need for art posters or self promotion here.

Just a clean and simple website with artists speaking 

on the topics and questions that artists have.

The informality of the first 20 minutes has a charm to it

until...

Listen for yourself

Art by John Van Vliet

At least 40 minutes into it, they bring an actual facilities owner  

to answer the questions and discuss solutions.  
(just scrub ahead if you can to the good stuff)

He is informative and very honest.

He explains the difference between a trade org and a guild.

One of the best points the facilities rep makes 

is that a guild would create more security 

for people who are freelancing and bouncing from job to job

through a "monster benefits package" of residuals, 

pension, welfare and health insurance.

Important thing to fight for, in such a transient industry.

The funny thing is:  He says that his clients say

"You get paid when I get paid."

Well, that chatter has found itself all the way down the tree.

I have heard that more times than I haven't as an artist, since 2007.

Art by John Van Vliet

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  Here is my Dream Panel (5 people):

VFX Biz Rep

Marty Schindler

Consultant on business in VFX with clients like 

20th Century Fox, Cinesite, ILM, etc.

(I have been on panels with Marty and he is great)

One Big 8 facilitites Rep Possibilities

Examples: 

Tim Sarnoff (Sony), 

Scott Ross (DD), 

Lynwen Brennan (ILM)

One Union Rep 

 Kevin Koch

Steve Huwlett

Tom Sito

James Parris

 

One Guild Rep

SAG President - Ken Howard

One Seasoned Artist

(who has experienced the issues going on right now)

Anyone working right now

I appreciate these guys dealing with the issues 

and not have a separate agenda.

They dealt with issues that artists are concerned with
and specifically spoke about solutions instead of blame.

Lots of talk of how and why to start a trade union.

However, It was frustrating listening to two guys ponder issues 

they, themselves have never experienced.

I cannot wait until an artist who has experienced the issues below...

participates in a panel.

• not being paid at all
• or being paid 3 months after finishing a gig
• being required to be 1099 or accept a 30-day net pay schedule
  
• working for no OT
  
• working a 50 hour week for a flat day rate
  
• the need to place a trashcan next to you on the desk when it rains
• cannot find work anymore because it has all gone overseas
• has been told "you get paid, when I am paid." (up to 60-90 days)

P.S.  I want to make one thing very clear...THIS IS NOT just an issue at big studios.  In fact, my experience the small studios are the biggest offenders.

P.S.S.  I agree Digital Artist Guild (D.A.G.) would be a better name, since it covers all artists who work digitally.

Review: VFX Online Town Hall with Chris deFaria, Jeffrey Okun, Scott Ross

VFX Online Town Hall with Chris deFaria, Jeffrey Okun, Scott Ross 
if you missed it...

LISTEN HERE

Review:  The introduction by Lee Stranahan was well versed and made some great points.  Most importantly, the top ten grossing films of all time grossed 11.5 billion dollars and are ALL VFX films.  And, not just a few shots - HEAVY VFX films.

So, Lee asks the question, "Why is it that we are in a world where VFX films are doing so well while VFX facilities and artists who work in them are struggling?" And the discussion begins.

The General consensus I heard was:

• Scott Ross - We need a trade union to fight for facilities and artists both on labor issues and will the government.
 

• Chris deFaria - The facilites need to create a new business model and stop treating themselves like a commodity.
 

• Jeff Okun - The artists made their bed and now they need either lie in it or stand up and fight.  Artists! Stop taking jobs that offer such bad conditions.  Stop whining and do something about it.

I am really upset that the one person representing the artists, ended up blaming the artists for the current state of affairs.

Artists had nothing to do directly with the collapse of the economy, runaway production and overseas incentive programs or the very small P/L margins for VFX production.  It's absolutely outrageous to say artists - "You took the jobs, so stop complaining about it."  

Most VFX facilities change the rules on your employment daily.  If you do not believe me?  How many people out there have had their end date change from what was promised on a show?  Please reply in the comments.  (Just one example of rule changes..there are rate changes, job description changes, holiday changes, OT pay changes, 50 hour weeks which are against the law becoming standard, etc.).

When I got in CG/VFX in the early 1990's EVERYONE was stoked to be in the industry.  Even the old guys loved what they did.  The old guys I worked with were making a decent wage, staying employed, building savings, had insurance, were buying houses and starting a family.  I thought I was getting into a great field.  

Then, it all changed.  I talk about this in our book... 1994 was the beginning of the end for the VFX industry. 2D was dwindling and animated CG films started making A LOT of money.  VFX had always made money, and their budgets/profits tripled.  When big money like those box office profits come into play, the rules change. Chris deFaria makes the most important point - leverage.  We have absolutely no power without leverage.  The bottom line is India, China and the rest can try to catch up, but the artists who have been doing VFX for over 10-20 years are the ones creating innovation.  Compounding the problem is the overseas studios don't have the local talent to do the job and now import the seasoned artists at half the rate.  This is a very poor business model that will eventually implode.  This is also very differnt than what happened to 2D because of the nature of the work.  The less skilled work for 2D could be shipped overseas, but innovation stayed in the U.S.

In traditional circles, the tools changed very little over the course of 80 years - pencil and paper.  CG needs innovation to happen throughout production because of the technical aspects of what we do.  Innovation will not grow in an atmosphere based solely on low wage, unskilled labor.  Studios want innovation at a very low price.  This cannot work.  If studios want the best work possible, then they will have to value the facilities and their artists.  Until we are viewed as valuable to these blockbusters, we have no leverage.  The way to do this is for facilities to create a brand out of their studio and then the best work will go to that studio rather than the lowest bid.  In addition, an organization of individuals qualified to handle legal, labor and government lobbying to push this agenda forward is critical.  I believe the artists are willing to join such an organization, but are not qualified to form one.  We need qualified leaders to do so.

Okun mentioned several times that artists are just whining and not offering solutions.  I think plenty of artists have offered solutions like guilds, trade unions, requests to the VES to help, the town hall itself came out of artists writing to Lee to ask what is next.  The panelists also discussed how most VFX facilities were started and run by artists who knew very little about business or management.  NOW Okun says artists need to start a union themselves and fight.  What a mess.  What a very hot mess.

I do hope an artist will represent artists on the next panel to offer a real perspective of what is going on for the people actually clicking on a mouse.  In fact, I offer my services on the panel if they will have me.  I have ideas of others who would be great additions if not me.

I think the best part about the whole situation is... Unlike most labor issues, there is unified bond and goal for both VFX facilities and artists.  Help the facilities and you help the artists and vice versus.  This is ultimately a win-win situation.

I welcome your comments...

Protecting Yourself as a Freelancer

A friend of mine has posted a blog recounting the way he was treated by a studio as an artist. He documents the entire process he used to protect himself with legal correspondence over a disagreement in compensation.

Epilogue Ei8ht

I have several studios who still owe me money from 2007-2008 because I did not employ the documentation he used. I am not incorporated and if I had pressed with legal action against these studios, they would have owed me tens of thousands of dollars in penalties, on top of wages owed. I didn't press out of fear of being blacklisted by the studio. Ironically, I would never work for these studios again because of how I was treated. I create a statement or work now and require the DP to agree to all points before starting any gig, so we are all on the same page.

In addition, there has been a lot of talk lately about EOR (Employee of Record) organizations and the rights of freelancers. Employees are often misclassified as Freelancers. The EOR's protect the studios by offloading the expense and liability of dealing with freelancers.

To get a really good idea about EORs and

The Freelancers Dilemma, check out these links:

IRS and the Freelancer Dilemma

Questioning the Freelance Dilemma

U.S. Cracks Down on ‘Contractors’ as a Tax Dodge

Organize Employee of Record

Changing Definition of Industry Association Better Reflects Existing Post Production Workflow and Service Offerings

List of EOR's in Los Angeles

California State Work Overtime Policy

California State Paydays pay Periods and Final Wage Laws

Independent Contractor VS. Employee

The most prominent EOR company in LA is MBO Partners.

This is how MBO handles your check:

If you are paid via MBO, they take 2-5% fee for processing your payroll depending on what the studio negotiated with them.

Then, the normal employer's tax is taken off your wages first... e.g. Social Security, FUTA - federal unemployment and training, and in California: SUTA - State Unemployment .

Then they will run payroll, and the employee's tax is taken off: Federal Withholding, State Withholding, Social Security and Medicare. Note: Social Security is taken out twice - you are, in effect, paying double the Social Security tax because the employer pays zero.

The only benefit of MBO, is that you can collect unemployment because you are an employee of MBO and not operating under a 1099/contractor classification. Which is only right because you are paying the employer portion of unemployment taxes in addition to your own. So, unless you collect it, you'll never get that money back. MBO gets the studios off the hook with the IRS, but it doesn't make the comply with state law regarding classification of workers, pay periods or overtime laws.

MBO also doesn't pay on-time - at least in the State of California. They may invoice the company weekly for your work, but it takes them a few days to issue the invoice. The company has ten days to pay MBO. If MBO receives the money by Tuesday, you may get paid Friday, otherwise you'll get paid the following Friday. You'll be waiting 3 or 4 weeks for that first check.

In California, its illegal:

In California, wages, must be paid at least twice during each calendar month on the days designated in advance as regular paydays. The employer must establish a regular payday and is required to post a notice that shows the day, time and location of payment. Labor Code Section 207 Wages earned between the 1^st and 15^th days, inclusive, of any calendar month must be paid no later than the 26^th day of the month during which the labor was performed, and wages earned between the 16^th and last day of the month must be paid by the 10^th day of the following month. Other payroll periods such as weekly, biweekly (every two weeks) or semimonthly (twice per month) when the earning period is something other than between the 1^st and 15^th, and 16^th and last day of the month, must be paid within seven calendar days of the end of the payroll period within which the wages were earned.

MBO helps companies evade payroll taxes by forcing each of their employee's to pay said payroll taxes on top of paying the employer's normal payroll costs in the form of the MBO fee.

Win win for the employer, and lose lose for the artist.

VFX Labor and the Animation Guild's POV

Steve Hulett and Tom Sito

Everyone working or wanting to work in VFX,
CG and animation should listen to this podcast.
Steve Hulett of The Animation Guild
discusses visual effects and labor issues.

FX Podcast with Steve Hulett

FX Podcast also just interviewed Lee Stranahan
who wrote the letter to James Cameron for the Huffington Post

FX Podcast with Lee Stranahan

Letter to James Cameron

Letter to James Cameron

From: Lee Stranahan

To James Cameron,

I'm addressing this letter to you because you and your films have been such an inspiration to so many who either watch or work in the movies. I'm asking for your help in addressing a problem that few in your audience have probably ever given a thought to -- the unfair treatment and working conditions of visual effects artists around the world.

Visual effects films were dominant commercial forces in 2009. Films like Avatar, District 9 and Star Trek all succeeded because they brought together visual effects with great writing, acting, directing and other cinematic elements. There are other films for which the visual effects seem to be the primary audience motivator. Without any slight, the reality is that people did not go to see recent commercially successful films like G.I. Joe or the Transformers movies for the script, music or the acting. They went in droves to see the spectacular visual effects - the "thrill ride."

For all of these films that rely heavily on visual effects, the studios and theater owners made hundreds of millions of dollars. The writers, composers and actors all will receive well-deserved residual payments for decades to come. But the visual effects artists don't receive royalties and residuals. And as one visual effects artist told me, "even in the credits, we're listed after craft services."

Like most people who work in the film, television and video game industries, visual effects artists love their jobs. They enjoy both the work itself and the ability to work on a daily basis with so many smart, creative and talented people. However, visual effects houses can be the best, most fun and high-tech sweatshops on earth. Visual effects artists typically work with no contract, no paid vacation, no benefits, and often no paid overtime. And because of the nature of the work health problems such as obesity, tendinitis and carpal tunnel syndrome are common.

The thing needed is recognition of the problem and the value of these artists. When I say "value", I'm not using that term abstractly -I mean the bottom line, practical dollars and cents value of visual effects to the film, television and video game industries. Just take a look at a list of the world's top grossing films of all time - of the top 30 films, every single one of them is a visual effects driven or animated film. Visual effects have meant multi-billion dollar business for the studios.

Unlike every other craft in the film industry, there is no union for visual effects artists. This seems to be a matter of timing as much as anything. Modern visual effects techniques are only a few decades old, and the digital side of the visual effects arts really only has about 20 years of history as a popular filmmaking tool. The other filmmaking disciplines such as acting, directing and music composition date back to the very beginnings of the film industry.

This newness has left digital visual effects artists with absolutely no collective bargaining power whatsoever. In this age of weakened unions, many of these artists are understandably leery of the idea of unionization. Additionally, visual effects artist currently work under constant threat from producers of having their work sent off to India or China. (The irony of sending creative work to a country like China that routinely censors communications -- including the announcement of this year's Oscar® nominations -- doesn't seem to bother these bottom-line seeking producers.)

Perhaps some sort of "Union 2.0" structure is needed; a more flexible, modern institution that takes the realities of today's production environment into account , while still giving these artists some of the same basic protections and benefits that other crafts currently receive. But whatever the solution, it's important people become aware of the problem.

Mr. Cameron, you are in a unique position this Academy Awards® season. Your film Avatar has been nominated for nine Oscars. Odds are high that at some point, you'll be up on stage accepting a well deserved award. Just as you took time recently to speak out on behalf of NASA, I'm asking you to consider taking a moment to speak out on behalf of visual effects artists and how they are being treated unfairly.

Even a small statement by you will cause industry and press attention to focus on this issue. The Visual Effects Society is awarding you a well-deserved lifetime achievement award later this month. There's no question that your groundbreaking films such as Titanic, Terminator 2, and now Avatar have all fused visual effects and storytelling into movies that have succeeded both commercially and artistically.

For the sake of all the artists who have both worked for you and been inspired by your work, please allow whatever victories you have on Oscar® night to be beginning of meaningful discussion in Hollywood about fairness for the thousands of artists who create visual effects.


Lee Stranahan has worked in and written about visual effects for nearly 20 years and is host of the podcast FX Mogul Radio, where he interviews artists, executives and filmmakers about VFX. Crossposted at LeeStranahan.com

The IRS and the Freelance Dilemma

You may be paid on time finally as a freelancer for VFX, but you will have to pay an outside payroll company 5%??? Also, the author says artists don't pay taxes when they invoice, when they actually end up PAYING MORE when tax time comes around than if they were an employee.

In fact, when studios pull a 30-45 or sometimes "90 day net" on artists the checks are so big they are taxed upwards of 45-65%!! Not to mention the guy saying he owed 20k in taxes in this article??? If you are freelancer, you should be putting away for tax time.

From AWN:

The IRS and the Freelance Dilemma

The IRS and the imaginary sequel to Mel Brooks’ Spaceballs have one thing in common: they’re both in search of more money.

For Brooks, it was just a gag; for the IRS, it’s a mission to plug what the agency sees as a $14 billion annual gap between their estimates of taxes due and what was actually collected – and for a while now they’ve been targeting the nebulous world of the 1099-paid freelancer or independent contractor. That person may be doing the same work as a fulltime employee, but both the freelancer and the company avoid paying upfront income or social security taxes. The IRS had been scrutinizing companies like Microsoft and Federal Express, outfits that made use of so many freelancers on a long-term, open-ended basis it gave birth to the word ‘permalancer.’

In recent months however, the IRS has set its sights on the animation and visual effects industries. (California and New York – states hosting huge amounts of production work – have also become more aggressive in their tax-collecting efforts.) It’s a world where animators and effects artists are nomads, travelling from company to company, coming on board to work on a commercial or a movie before moving onto a new project at the next shop that needs their services.

read more here...

Working in China?

Check out VFX Wages


january 11 2010 at 11:58 a.m.
category:

A guest post from one of our users, with editorial corrections and comments. Reprinted by permission.
--
Many complain that outsourcing companies in Asia cut jobs in the West and many fear that low wages in the East endanger jobs in the West. No doubt there is a trend towards outsourcing since economic downturns force many producers to look for cheaper options abroad. (correction ed.)

I just want to shed some light on the environment domestic artists are forced to work and live in and how they think about us.

Here are some facts:

• A junior to mid-level artist earns between 3000 to 4000 RMB (~440 to 730 USD) per month. Senior to supervising level reach 8000 to 10000 RMB (~1172 to 1465 USD). Roto/Paint Artists and Modeler sometimes even work for 1000 RMB (~146 USD) per job/model/per month
• There are no benefits (health, social, unemployment, retirement, pension) whatsoever. Bonuses are rare, many times promised but rarely paid.
• There are no regulations on working hours or overtime payment (Many work 7 days/week) meaning there are no unions nor any regulations nor guilds thus zero protection nor any law enforcement which protects them.
• They can fired without notice nor can get paid if the boss is not satisfied with their performance or work. There are official holidays but unpaid of course, the same is true if someone has to take sick leave.
• They are asked to do everything from matchmoving, rotoscoping/clean-ups, modeling, texturing, animating, compositing, etc.
• A job interview seldom includes a showreel or a professional presentation of any kind. Most guys who run these sweat shops are either rich kids but mostly real estate guys who think that CG/VFX/Animation is an easy business to make fast bucks. Telling the boss that they know AE, Fusion, Shake, PFTrack, Boujou, Matchmover, Nuke, Flame, Realflow, 3DPaint, Mudbox, ZBrush, Dee Paint, Photoshop, Maya, 3Dmax, XSI, Houdini etc. usually gets them a job.
• This means that all these kids have these application on their laptops, for free of course meaning you can download them from many Chinese servers including all plug-ins you possibly can imagine. Sure the government tries to implement copyright protection in China, but when I can buy cracked DVDs I wonder why there are so many police officers and government officials that can buy DVDs and copies of the latest Windows application as well. (edited ed.)
• PC's are dirt cheap and for every IT nerd the paradise in China is Zhongguancun (Chinese Silicon Valley), which is probably the biggest PC and consumer market of electronic products in the world with billions of revenue every year. Taiwan is in close proximity therefore electronic appliances vast and very cheap.
• To open a company costs basically nothing, 5000 RMB (~732 USD), for a license including a tax registration. BUT there is a huge subculture of homegrown businesses basically operating from rented apartments in a residential area. Many of them work on very successful ad campaigns with cracked Flames/Smokes and a fully blown post facility, with a stacked up server in the air-conditioned toilet.
• Talent pool is huge however there is no quality awareness nor any existing standards. The ones who can speak English try to go abroad without knowing how a company is managed nor how a real pipeline works. (edited ed.) Traditional art skills (concept art, oil/ink painting, mattepainting) is really good and has a long history in China. On the animation and compositing side of things, the lack of experience and the shabby education are the biggest obstacles to becoming a professional in a western sense.
• The companies who are doing outsourcing jobs are mostly run by Chinese who had the money to study or work abroad and have gotten used to the western style. So when coming back, there is so much money and additional resources, many of us can only dream about. Just to give an example, CCTV's (China Central Television) revenue is nation-wide and one can easily assume that money is not a problem for the people who have the right connections (meaning having the right 'guanxi'). So to start an animation business..The revenue available is, 270,000,000,000 (270 billion) RMB (~39,543,057,598 USD). In general can we say that the richest government in the world is owned by the communist part with access to several trillion USD in foreign currency reserves. (edited ed.)

Now to my reality:

Currently i work as a VFX Supervisor on 50 episodes of a TV adaptation of one of the 4 most famous novels in Chinese history. Maybe you have heard about (Monkey King, Chinese: Xi You Ji). The budget is 100m RMB (~14.6m USD) with an overall VFX budget of 15m RMB (~2.2m USD). YES!! I am not joking, the average vfx cost per episode is 300,000 RMB (~44,000 USD) including everything VFX can do from complex wire and rig removal to clean-up work to CG creatures, mattepainting and compositing. Average shot count is 200 per episode. The timeframe until completion of all 50 episodes is 8 months! This is with roughly 300 artists. The plans for the future from some really crazy real-estate guys is to build animation/vfx factories (factories, not studios or companies, comment ed.) with 7000 employees.

I work now non-stop for 4 to 5 months without a single day of rest and 15 hours on-set, of course it is winter and no heating system nor air-suction system exists. We shot for one month above 3000m (close to Tibet) in snow, drizzle, rain, ice with two HDCams and a crew of 15 production guys and 30 stunt/wire members. Lunch is outside, wake up call was 5:30. Stunt and wire crew (all Kungfu kids from famous Hunan martial art schools close to the Shaolin temple, some even grew up there as Kungfu monks because their parents couldn't afford their education or simple had not enough money to raise them) are without doubt the best of the best and the toughest guys I have ever met but at the same time warm hearted and extremely polite. No matter how long you drag them, they work their ass off to please their master ('sufu') or climb up (of course unsecured) on the roof supporting beams of the studio ceiling to fix their wires. One of our directors is a ex-stunt guy and he commnds them with a voice like a drill sergeant of a marine corp. No arguing or complaining, they obey like they have learned to as a Kungfu student.

The studio I am working barely fullfills any safety standard. Like I mentioned no air suction system, especially critial when they paint spray a newly built set besides our huge bluescreen cyc (cyc:large fabric wall, pronounced sike ed.) or when they burn diesel instead of vegetable oil for their set torches. Besides that the whole floor is covered by fine powdered sand to act a set flooring. It has already killed my on-set keying previz machine once and my assistance spit blood after 3 months of being constantly on-set. BUT the efficency is high, no bullshit, no coffee break, no safety harnesses, no union regulations, sets are built around the clock, laborers are plenty and cost basically nothing, a carpenter earns 40 RMB (~5.85 USD) per hour, some work for half or a third or that. Quality of construction is good, even though breathing in such a set is not recommended at all as the paint highly poisonous. I wear during my supervisor time a half gas mask from 3M which makes the communication with the director a little bit difficult but also lets me feel a little bit like Darth Vader :-)

So in conclusion, my explanation of why producers are pulling out their secret outsourcing weapon and are looking into Asia (China); it is cheap and fast and many things can be accomplished or even tried out which would be impossible in the West for obvious reasons like insane TNT explosions, quantity over quality, and cheap labor.

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Ralph Bakshi: Surviving In Tough Times

Legendary animation director, Ralph Bakshi discusses how he survived the collapse of theatrical animation and offers tips to current animators for how to succeed in the cartoon business. ( ASIFA-Hollywood / www.animationarchive.org / San Diego Comic-Con 2008 )

FX Guide Interviews Scott Ross

Scott Ross Interview FX Podcast Listen Dec 11, 2009 - Industry pioneer Scott Ross is our guest as we talk about visual effects history and the future of the business.

The good stuff starts around 19 minutes!!!

Cheaper - Faster - Better
The future of freelancers...

Awesome, awesome interview!
He tackles
runaway production,
driving the cost of VFX down,
winning an Oscar kills business,
the vfx biz,
and starting a VFX guild
vs. the role of the VES
...wowsie wow!