by Nick Hanover
Last May, the tech and geek oriented site ICv2 reported that a class action lawsuit had been filed against Eitane Emerald Corp, the former organizers of Emerald City Comic Con, for their use of volunteer labor. On behalf of himself and as many as 250 other volunteers, Jerry Michael Brooks claimed EEC was using volunteer labor illegally and he and his fellow volunteers were owed back wages. The news didn’t make much of a splash outside of the Pacific Northwest and the comics community, but when I first encountered the info, my immediate thought was “How soon until we see similar suits against not only other conventions, but music festivals and SXSW?”
As ICv2 pointed out in a follow-up piece it posted this week about how large of an issue this potentially is for events,
According to the Fair Labor Standards Act, all employees of a business must be paid a minimum wage (currently $7.25 at the Federal level and higher in many states), and those who qualify must also be paid overtime. There are some exemptions, including one for “Seasonal Amusement or Recreational Establishments,” but conventions are specifically not considered under this definition.
Under the law, only recognized non-profit organizations and certain very specific kinds of community, government and agricultural groups can use volunteers. If a convention is organized by or in conjunction with a non-profit, as is the case with San Diego Comic-Con, Denver Comic Con and a variety of other mostly local cons and festivals, no problem. Fan conventions that are run by for-profit organizers like ReedPop, Informa, Wizard World, and independent shows like Phoenix? Definitely a problem.
Music festivals and large scale multimedia events like SXSW are equally vulnerable to the Fair Labor Standards Act, but have been curiously overlooked for quite some time. That started to change once internship lawsuits were filed against Hollywood studios and major labels, and law firms realized music events were utilizing similar programs to unpaid internships. In 2014, Billboard reported on a suit filed against Nocturnal Wonderland promoters Insomniac and their partner, communications giant Live Nation. The next year, Vice imprint Thump found that Insomniac had quietly shifted away from volunteers and had replaced most volunteer positions with paid staff, something we also predicted would happen to C3 events after Live Nation purchased them. But even with these major suits popping up, the shift towards paid labor in the music festival sector has been slow.
SXSW is an especially notable potential future case for this because its use of volunteers is more extensive and more labor intensive than even the biggest convention. The same year that Insomniac suit was filed, Salon published a landmark editorial on SXSW’s potential labor problems, with Ross Eisenbrey of the Economic Policy Institute openly stating that he doesn’t see how SXSW’s structure could possibly be legal. Where ECCC and even Nocturnal Wonderland are events that mostly use volunteers to direct guests, give information and provide other guest-related services, SXSW has a self-described “army of volunteers” some 3,000 strong who do everything from guest services to highly skilled labor in exchange for a coveted SXSW badge, something that costs SXSW exactly nothing unlike internships which are required by law to not replace paid labor (SXSW has internships as well that are completely separate from their volunteer program).
Like many other media and event companies, SXSW has skirted the law because the industry it operates in is extremely competitive and the volunteers who provide their time and skills have been taught to view these free labor programs as simply a necessary thing for the development of their careers. SXSW, like so many companies before it, has frequently responded to this illegal labor issue by citing the “happiness” of their volunteers and the lack of suits filed by these volunteers. If almost no one is suing these companies, then there must not be a problem, right?
Obviously, it’s more complicated than that. SXSW’s use of volunteers goes beyond a simple barter transaction, where volunteer staff get access to the event and SXSW gets to float through the year with less than 100 paid employees (that low staff number also makes it even less likely that a volunteer position at the company will lead to paying work). Where these volunteer lawsuits have popped up, like the landmark Black Swan internship case, courts have become increasingly more hostile to the companies that blatantly disregard labor laws. And there’s good reason for that, since these companies are not only diminishing the income of workers but also taking money away from the government and creating situations where workers are blocked out from laws that protect them in case of accidents. As ICv2 points out
…if “volunteering” is actually paid labor, there is a third party to the transaction: the government. Employee compensation is subject to FICA (Social Security and Medicare) tax, and possibly income tax withholding as well, even if the compensation is in-kind rather than in cash. The costs of managing a “payroll” of volunteers, collecting their Social Security numbers, filing form W-9, figuring out their imputed rate of pay, and then paying the employer and employee share of those taxes (which could also include state and local taxes, depending on the location), likely far exceeds the value of their labor contribution to the event…
What’s perhaps even more distressing is that other companies that are paying attention to the ECCC case have focused on finding loopholes that allow them to still utilize unpaid labor through partnerships with non-profits. ICv2 uses the example of Phoenix ComiCon, which partnered with the nonprofit organization Blue Ribbon Army, requiring hopeful volunteers to pay a $20 fee to become a “member” of Blue Ribbon before applying to volunteer at the convention. On the one hand, this brings money to nonprofits, potentially bringing some resources to community organizations, but on the other hand it opens the doors for unpaid laborers to be profited off of even more. Indeed, SXSW already has a program like this, where musicians, filmmakers and other SXSW hopefuls pay application fees when submitting their work to SXSW, though it’s connected to Sonicbids rather than a non-profit. Could a strategic partnership between SXSW and a local music non-profit be next? And would that really been the best solution for this growing problem?
Austin has been fortunate in that it’s a city with ample job opportunities and seemingly endless growth, but it would behoove the music community to pay attention to the case against ECCC and consider filing a similar suit against SXSW. A large scale effort to get SXSW to change its ways and compensate the volunteers who work hard for the organization would not only have an immediate impact on the job loss our music sector has seen despite Austin’s growth, it would also send an even larger message than the Black Swan case did, making it clear that skilled media work deserves fair pay.
Nick Hanover got his degree from Disneyland, but he’s the last of the secret agents and he’s your man. Which is to say you can find his particular style of espionage here at Ovrld as well as Loser City, where he mostly writes about comics. You can also flip through his archives at Comics Bulletin, which he is formerly the Co-Managing Editor of, and Spectrum Culture, where he contributed literally hundreds of pieces for a few years. Or if you feel particularly adventurous, you can always witness his odd .gif battles with his friends and enemies on twitter: @Nick_Hanover