Law on both sides of Hobbit controversy

In the ongoing controversy across the Tasman, the Attorney-General Chris Finlayson used New Zealand’s Commerce Act to say The Hobbit producers can’t enter into union-negotiated agreement with performers who are independent contractors, but the NZ Actors’ Equity claimed law “is no problem” in this situation.

The Attorney-General Hon Chris Finlayson issued the following statement:

There is an issue as to whether New Zealand’s Commerce Act 1986 (“the Act”) prevents the Hobbit movie producers from entering into a union-negotiated agreement with performers who are independent contractors.

The New Zealand Government has obtained advice from the Crown Law Office (legal advisors to the New Zealand Government) that confirms the Act does prevent the producers from doing so. Section 30 of the Act effectively prohibits competing independent contractor performers from entering into or giving effect to a contract, arrangement or understanding that has the purpose, effect or likely effect of fixing, maintaining or controlling prices for goods or services – which would include performance services.

There is some suggestion that the relevant independent contractors be treated as “employees” on the grounds that Section 30 does not apply to “employees”. However, it cannot simply be asserted that they are “employees” for the purposes of the Act if they are, in truth, independent contractors.

I trust the above provides some clarification of the New Zealand legal position.

The Actors’ Equity responded almost immediately:

NZ Actors’ Equity has reviewed a media statement from the Office of the Hon Christopher Finlayson released this evening.

This states that Crown Law has advised the Minister that The Hobbit’s movie producers are prevented by the Commerce Act from entering into a union negotiated agreement with performers who are independent contractors.

The legal advice obtained by NZ Actors’ Equity from Mr James Craig, Partner, Simpson Grierson (a summary of which is attached) is that there are lawful means consistent with the provisions of the Commerce Act which can be used to move the issue forward. “We have advised NZ Actors’ Equity that with goodwill on all sides there are lawful ways in which this matter can be resolved. The Commerce Act need not be an impediment to resolving the situation.” said Mr Craig

“My knowledge of the producers is that they are people of goodwill. I am sure they would want to explore all lawful means by which these issues could be moved forward and resolved.” said NZ Actors’ Equity President Jennifer Ward-Lealand.

The Actors’ Equity will meet again today to assess the situation.