The Honorable Ed Chavez
Arts, Entertainment, Sports, Tourism and Internet Media Committee
P.O. Box 942849
Sacramento, CA 94249
Dear Mr. Chavez:
On behalf of the Department for Professional Employees, AFL-CIO—the nation’s largest organization of professional and technical workers representing some 4 million white collar employees—I wanted to convey to you our strongest support for S.B. 1034 regarding accurate accounting of royalty payments to recording artists. Our organization includes among its affiliated unions all of the major entertainment and media unions whose members include several hundred thousand Californians employed in these sectors.
Joint hearings in 2002 by the California State Senate highlighted an array of accounting and other related abuses which have the effect of defrauding musical artists out of hard earned compensation to which they are contractually entitled. In the accounting realm, ineffective and negligent record-keeping costs these artists millions of dollars that they are owed. In addition, since such earnings are a determining factor regarding qualification for health and pension benefits, slipshod accounting can disqualify these workers from eligibility for health care coverage and retirement income to which they and their families are entitled. For some of these artists, it then falls to taxpayers to step in and provide subsidized health care or income support services—another example of corporate welfare for the record labels.
Currently there is no effective deterrent to stop record companies from failing to report royalties accurately and completely. The absence of meaningful penalties in effect creates a disincentive for the companies to do what the artists believe they are obligated to do. In essence, these multi-billion dollar entertainment companies are rewarded for bilking their very own talent out of the fair payments that are owed to them.