Commercial agencies sought to reduce Canadian actors’ compensation as much as 89%, document shows

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A national group of ad agencies proposed reducing unionized actors’ compensation for commercial work by as much as 89 per cent for some productions, according to an April presentation to members of Canada’s largest actors’ union.

The Globe and Mail has viewed presentation slides and verified their contents with multiple members who saw the spring presentation, and is not identifying its sources because they may face retaliation for sharing details. The 28,000 members of the Alliance of Canadian Cinema, Television and Radio Artists (ACTRA) have been in a labour dispute that the union has described as a lockout with the Institute of Canadian Agencies (ICA) since April, 2022.

The dispute centres on the six-decade-old National Commercial Agreement between ACTRA and the ICA, who have become bitterly divided. The actors call it a collective agreement; the agency group calls it a commercial contract. Either way, it underpins lucrative work: the ICA represents numerous agencies – including Leo Burnett, Sid Lee, and Taxi – a broad group whose clients include major brands such as Canadian Tire, McDonald’s and H&R Block.

Commercial jobs, especially for prominent brands, can be a vital lifeline for working actors, and many have been financially depleted during the 14-month-long standoff. ACTRA and the Institute are scheduled to return to negotiations with a mediator next week.

The actors’ union declined to comment out of respect for the bargaining process. In an e-mail, ICA chief executive Scott Knox said that he looked forward to returning to the table “to bring equity and fairness” to their relationship, “reflective of the expanded breadth and opportunity of current day technologies on the current day marketplace.”

The details of ICA’s proposals viewed by The Globe, which are no longer in play but reveal the intensity of the groups’ long negotiations, would have put significant restrictions on long-term income for actors appearing in commercials, industry figures said.

Earlier this year, the slides show, the Institute proposed that, for ads whose talent costs exceed more than 10 per cent of a commercial’s production budget, actors should receive flat fees for combined digital and TV advertising campaigns – rather than the current norm, which sees actors receiving “residual” payments over time. The proposed fees would range as high as $4,000 in compensation for a principal actor for a yearlong ad rollout to $350 for a voice-over narrator for an eight-week rollout.

This change in compensation structure, with residuals diminished, could lower actors’ total compensation from ads by between 70 and 89 per cent, ACTRA officials wrote in one slide. Strategy Magazine previously reported this figure in an interview with ACTRA national executive director Marie Kelly in June without providing details about how the percentage was calculated.

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Such a cut would be drastic to working actors. “It’d be impossible to make a living wage in a market like that,” said Fiona Highet, an ACTRA member whose commercial voice-over work has accounted for at least 60 per cent of her income for the past 20 years.

None of the individuals quoted in this story, including Highet, shared the slides with The Globe, and all agreed to speak only in the context of the consequences such kinds of proposals would have for their work and livelihoods.

Such a cut to commercial income, especially from lucrative residual payments, could trickle down through the entire performing-arts sector in Canada, warned Highet, who also works in theatre. Theatrical life can be precarious, and actors often need to pay their bills with other work. If they can’t pay their mortgage, “they can’t live in downtown Toronto, which means downtown Toronto doesn’t have a theatre scene.”

Knox declined to comment on the individual proposals obtained by The Globe, but said: “Proposals can be made, often at the request of the other side, to highlight the issues facing one of the parties. They may not the final desired outcome but aimed to be catalysts to get great ideas and solutions on the table.”

Such a rigid fee structure could also have longer-term financial implications for actors. They’re generally prevented acting in many competing companies’ ads for six months after a commercial campaign ends, and thus dependent on residual income before going back on the acting market.

“The compensation from residuals is important because it’s much more than their daily fee for a shoot,” said Maggie Dunlop, a talent agent with Oldfield Management in Toronto, who spoke on behalf of her clients trying to make a living through commercial work. She declined to comment on the ongoing labour negotiations.

Residuals are important because the success of an ad, despite exposing an actor to greater audiences, can also extend the amount of time they’re conflicted from taking on related advertisements. “It can limit them,” Dunlop said. “There is an expectation they can count on a certain amount of money. They’re dependent on that for their livelihood.”

The ICA also proposed expanding a program for lower-budget digital commercials (which allows lower payments to actors) to include television. The proposal also included expanding the range of production budgets for the program, raising the eligibility threshold from $75,000 to $300,000.

ACTRA officials wrote in a slide that this would account for “most commercials,” and would result in actors receiving just $1,000 to account for both the shoot and residuals for a year of unlimited use of the ad – resulting in an 80-to-90-per-cent cut in fees. Given the time needed for actors to avoid conflicts of interest, this could reduce some actors’ commercial income to just $1,000 for as long as 18 months.

The slides also show that the commercial-agency group asked for an exception for the use of union actors in social-media ad campaigns, particularly if they could rely on user-generated content.

The National Commercial Agreement is also signed by a third party, the Association of Canadian Advertisers, which has renewed its side of the contract with ACTRA for two one-year terms.

Earlier this year, the federal government came under fire for relying on ICA member Cossette, which at the time was using non-ACTRA labour for much of its advertising during the ICA dispute. But in April, Cossette signed a temporary agreement to work with ACTRA actors through the end of 2023.

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