The Writers Strike, Unions, & Interdependence Theory
Toni Morrison once wrote, “A writer’s life and work are not a gift to mankind; they are its necessity.”1 As we close in on the fourth week of the writers strike, studio executives will put that premise to the test. Beginning on May 2, more than 10,000 members of the Writer’s Guild of America began striking for more favorable conditions to be included in their new contract. The strike has already disrupted a number of prominent shows and many expect further disruption as the strike extends into the summer. Analysts expect no resolution any earlier than July given that the two parties have not returned to the negotiating table since talks broke down on May 1. Adding to the complexity, the contracts for the Directors Guild and Screen Actors Guild - the latter of which has preemptively called for a strike authorization vote - end on June 30 and will be the priority for studios until they are renegotiated.2
For studios, managing their bottom line through a time of economic strain is key. Blockbuster success has been increasingly hard to come by in the post-COVID world. And the race for streaming dominance has led to rich contracts with producers and directors as well as low-price competition with an ever-growing competitor set. However, many of these studios have their eyes set on dropping over-priced talent that has not panned out as force majeure clauses kick in this July. This could significantly extend the willingness of studios to hold their position and extend this strike longer than the record-breaking 153-day writers strike of 1988.2
For writers, the key issues are a threat to their long-term survival. On the one hand, the WGA is looking for fair compensation on the upside of streaming. Historically, writer compensation has included residual payments for the show or film as it continued to do well and was sold again and again. As video streaming has evolved, writers largely earn an initial lump sum with no residuals as the show only sits on a single platform, such as Netflix, in perpetuity and does not get resold like in prior times.3 On the other hand, the WGA is looking to minimize an existential downside of far greater concern. Writers see significant risk on the horizon from the acceleration of generative AI tools being used by studios as a way to minimize or eradicate the role of writers. The WGA is looking for on-set staffing minimums and other employment protection measures to protect themselves from heavy-handed implementation of these tools by execs.4
Each of these topics are loaded questions. Individual compensation and its balance with organizational economics is full of trade-offs. The way we view these inputs is largely framed by our own biases. As with all bias, this warrants a better understanding of how we see its influence and it requires education on tactics we should use to account for them. The recent acceleration of generative AI is not the first economic and automation revolution our society has experienced, even if it feels like it may be a more disruptive change than either the agricultural or industrial revolution. Obviously, better understanding how AI can influence the work of individuals and how organizations can maximize its value is worth a review. Given just how robust these topics are, we will break this up into a few separate posts.
Here, we will focus on the force behind the strike - the Writer’s Guild of America. We will look at interdependence theory and look at how it helps us to better explain individual and group behavior. And we will apply phenomena explained by the theory to describe a few of the causal forces that lead to union formation in an employee base. To close, we will talk about why unions are not an inevitability and how effective management practices can solve many of the concerns that lead to their formation.
Describing Interdependence Theory
It is fitting to talk about the Writer’s Guild of America in light of the arriving AI Revolution because unions initially emerged in response to the degrading work conditions of the Industrial Revolution. Like now, these early union employees wanted to preserve their autonomy and standards of work as employers and progressing technology turned craftsmanship into more standardized labor.5 Whether looking at screen-writing or steel-working, the benefits of unions are well understood - union members earn more, receive more generous benefits, and have more protection against arbitrary dismissals and layoffs than their non-union counterparts.6 These are all objectively good things and a big piece of why we have seen an increase in union formation in recent years, with notable headlines covering Starbucks and Amazon warehouse union group formations. For employers, unions are less often appreciated. Their contracts increase the cost of operations, decrease the flexibility of employers to adjust to changing market conditions or customer demands, and - as we are seeing with the WGA - can create confrontation when they go on strike over disagreements.6 Yet, arguably, unions are the result of the employers.
Psychological researchers consistently seek to explain human behavior, and the lion’s share of research is focused on individual influences, e.g. how can we explain your reaction to a situation based on your own experiences and dispositions. Yet when we look specifically at organizational behavior, much of our experiences do not occur in isolation. They are based in interpersonal situations. Psychologists Harold Kelley and John Thibaut designed interdependence theory to help describe and explain these encounters as an outcome of interpersonal and situational dynamics.7
To restate more simply, we can use this formula to describe interdependence theory
I = f[A,B,S]
which says that all interpersonal interactions (I) are a function (ƒ) of the given situation (S), plus the actions and characteristics of the individuals (A & B) in the interaction.8 This premise sounds like fairly common sense, and in many ways it is.
The usefulness of interdependence theory comes from its attempts to move beyond specific scenarios like “employee argues with boss” and to define behaviors in more abstract and re-usable frameworks like “partners’ interests conflict”.9 To do this formalized analysis, researchers developed four assumptions to understand all aspects of what happened. We will not dive deeply into them here, but they include7:
- Principle of Structure - a.k.a. The situation - A taxonomy of potential situations, generally focused on the idea of “affordance” or what the situation makes possible for the involved parties.
- Principle of Transformation - a.k.a. What people make of the situation - The rewards and costs present to individuals as well as how they think about the outcome potential of the other party involved.
- Principle of Interaction - a.k.a. The SABI model, a.k.a. the formula we discussed above - Outcomes anticipated by each party and also how their individual previous experiences in similar situations have primed them to expect certain outcomes.
- Principle of Adaptation - a.k.a. Learned behaviors - How people adjust their behavior over time based on prior experiences and also from the influence of social norms.
Academics use interdependence theory as a working model to explain interpersonal dynamics from social development, to group power dynamics, to conflict and cooperation, to love and commitment.7
Applying Interdependence Theory
The framework can also be used to analyze organizational dynamics and to describe behavioral phenomena, often extending explanations that fall short when relying solely on intrapersonal drivers.10 Specifically, we can find the following three phenomena at the heart of union organization.
Regulatory fit
- What It Is: Regulatory fit refers to the match between an individual’s regulatory focus (promotion or prevention) and the manner in which they pursue their goals. Traditionally, goal pursuit is described as being driven by the push for self-actualization. Interdependence theory suggests that this pursuit can actually be strengthened by our interactions with those around us. When there is a match, individuals experience regulatory fit, which can enhance motivation and performance.10
- How It Applies: Writers in entertainment have a promotion focus regarding their work. They want to work on larger and more successful projects in order to earn more and also achieve greater personal fulfillment for their career success. The studios have the same focus for themselves. But, when success outcomes are viewed as a zero-sum game, i.e. the studios feel they would make less profit by paying writers more, then the interpersonal alignments are contradictory and do not lead to regulatory fit. In that case, writers need the WGA in order to ensure they have a path to success. If regulatory fit was realized, the perceived need for union support and defense would be lessened. In this way, the presence of the union is an outcome of the employer’s promotion philosophy.
Persistence
- What It Is: Persistence refers to the tendency for individuals to continue in a relationship or situation even when they are dissatisfied. This can occur for a variety of reasons, including commitment, investment, and lack of alternatives. Motivation is often described intrapersonally, e.g. someone feels motivated to stick to a goal because they enjoy it or feel rewarded by it. Interdependence theory suggests that this is not always the case and that people can be motivated to stick to negative environments because of a lack of alternatives or sunk investment into the situation.10
- How It Applies: Like most of us, writers are often frustrated by the daily work of their projects or stagnation of their careers. Why continue to pursue such a frustrating goal? In part because they have already invested so much energy into their current path to get to where they are. And in part because there is only one Hollywood. Writers do not enjoy the same luxury of choice as someone in, for example, finance who could work at a bank, a private equity firm, a wealth management company, start their own fund, or pursue any number of broader options. Limited options create greater persistence in spite of negative relationships. This employer concentration also reduces employee control because it takes away their power of choice. The union then serves as a rebalancing tool for negotiating leverage lost from low optionality.
Origins and Consequences of Trust
- What It Is: Origins of trust refers to how trust develops in relationships and its impact on behavior and outcomes. Traditionally, trust has been viewed as an individual personality trait based on upbringing. The rough understanding is that when people are raised in benevolent environments they are more trusting, and when people are raised in malevolent environments they are less trusting. Interdependence theory stresses that trust is not a set factor. Individual’s demonstration of trust can vary across situations and time. It can grow through repeated positive interactions, especially when those pro-relationship activities are made in moments of conflicting interests. This heightened trust drives increased cooperation, reduced conflict, and improved relationship satisfaction. The relative strength of interdependence theory in describing trust is impressive as it accounts for roughly 30% of behavioral variance as opposed to only 5% that is accounted for by intrapersonal factors.10
- How It Applies: The history of the WGA and its relationship with the studios has been fairly conflicted. This is the sixth writers strike, dating back to 1960.11 That suggests a lot of missed opportunities for studios to have shown their willingness to invest in their writers. With each miss, trust is broken as the message is reiterated that the co-investment is not there. These miscues are not exactly up to interpretation either. In current negotiations, the WGA estimates that their proposal will yield writers an additional $429 million per year while the studios’s proposal will add only $86 million for writers.4
Not Inevitable
Unions do not exist in all industries nor are they present in all employee-to-employer relationships for the industries in which unions are active. This means that the causes for union formation are, in many ways, a result of interpersonal relationships between parties rather than a natural outcome. Interdependence theory can help to describe how these factors come together to cause employees to seek out union formation.
One of the initializing factors behind a union is a lack of regulatory fit where employees feel a significant mismatch has grown between the goals of the company and its people. For the WGA, that misalignment is presently seen in the evolving monetization of streaming. Studios are seeing revenue upside while writers are realizing an insufficient distribution of that benefit in their compensation structures. Realistically, there’s a consistent ebb and flow of regulatory fit at companies. Across time and across industry changes, the goals of any company and the individuals who comprise it will change. The balance of value will also shift, sometimes favoring the company and sometimes favoring its people. The shift towards greater digital engagement and use of generative GA is moving in to disrupt industries ranging from screenwriting to healthcare services. Yet in many of these disrupted industries, employee relations are continuing business-as-usual. This suggests that regulatory fit is only one of a set of contributing factors in union formation.
The next differentiator is trust. Trust is an important factor in the resilience of relationships. It influences the patience of people to work through a problem and their willingness to wait and watch how a shifting environment will play out. In a case where regulatory fit is lost, employees will be willing give the company a chance to work collaboratively towards realignment if trust is high. However, when trust is low, employees will not provide that benefit of the doubt. Positive intent will no longer be assumed in times of uncertainty because employees will feel burned from previous negative outcomes. We see this in the WGA strike now. The union has had to fight studios for compensation rights over decades, which gives them no reason to believe that the studios will willingly choose to share in the value being generated by streaming content. This factor of trust is why I suggested earlier that union formation is actually the choice of employers. Companies generally have the balance of power and therefore have greater control in deciding the culture and environment they want to build. The company has the opportunity to decide if they want to build trust. The company can choose to consistently focus on maintaining or ignoring alignment on incentives and goals with its employees. The company can decide to exclude its employees from defining the path forward and sharing in the upside. From there, employees can decide how they want to react, but the interdependent forces of diminished trust will guide that decision towards unionization.
Yet even with these two factors, a union is not inevitable. Persistence is a third key to the equation. Employees can generally choose to leave distrusted and misaligned management. Sometimes, they can’t leave. In the case of screenwriters, there is a limited industry where they can seek to find career growth and success. This leaves the protection of a union as their only option. Sometimes, employees won’t leave. While alternative employment may exist elsewhere, people can feel tremendous pride in the energy they have invested into building a brand, a product, or a content franchise. This is particularly true for tenured employees who have built a brand’s prominence over decades and now see management moving that brand in an undesired direction. While the business decision may be objective, the potential loss of meaning to employees from the time and creativity investment being forsaken can create real pain. In these cases, job options may exist but employees may choose persistence and unionization to protect what they have invested instead.
As we can see, there is no straightforward path to a union. And the formation of one is certainly not an inevitability. Interdependence theory gives us a set of tools to analyze and better understand the factors that lead to that outcome. When we make good-faith efforts to align the goals of our people with the goals of our company, consistently act with transparency and in good faith, and leverage our team’s resilience to create new growth potential we can drive more collaborative and better results.
Reference
- 45+ Quotes About Writing from Famous Writers | Audible.com
- When Will the Writers Strike End? Three Scenarios, From Fantasy to Hellish Dystopia | Vanity Fair
- The 2023 Writers Strike: Everything You Need to Know - Parade: Entertainment, Recipes, Health, Life, Holidays
- 2023 Writers Guild of America strike - Wikipedia
- Labor Movement (history.com)
- How today’s unions help working people: Giving workers the power to improve their jobs and unrig the economy | Economic Policy Institute (epi.org)
- Interdependence theory - Wikipedia
- Van Lange, P. M. (2011). A History of Interdependence. Handbook of History of Social Psychology. Routledge Handbooks Online.
- Interdependence Theory in Social Psychology - iResearchNet
- (PDF) Interdependence theory (researchgate.net)
- Writers Guild of America - Wikipedia
Share your work-related questions and dilemmas with us for upcoming blog post consideration.