Creators (interchangeably referred to as influencers) are individuals that are paid by brands to advertise certain products on platforms like TikTok, Snapchat, and YouTube. These content creators now have increased worker protections, as the Screen Actors Guild – American Federation of Television and Radio Artists (SAG-AFTRA) has extended their coverage and membership offers through the “influencer agreement”.
Under SAG-AFTRA membership, influencers will qualify for pension and health benefits based on the contributions made on their earnings. The union requires a minimum payment of 20% of their total compensation, which will then apply to their qualification for benefits. On top of offering benefits, the union promises to advocate for influencers and offer advice on compensation disputes. Whilst under membership, influencers will be able to freely-bargain for compensation with individual advertisers.
The timing of this development is no surprise, as increased unionization was expected under the Biden Administration, whose support of unions and worker protections was made clear through their campaign promises and his support of the PRO Act. Worker classification has been a prominent discussion in the gig economy, applicable here as influencers are not typical employees. This was highlighted by California’s passing of Prop 22 in the last election, and Biden’s freeze on proposed regulations including the DOLs final rule. The rule issued by the Trump Administration, would have made it easier for businesses to label workers as independent contractors rather than employees.
As COVID-19 continues to cause increased levels of unemployment and job insecurity, unions have asserted themselves through fights for hazard pay and safe working conditions. Influencers, however, despite COVID- 19 disruptions to the workforce, have continued to create content and claim revenue through building their own brands on various social media platforms, and maintaining their pre-COVID level of work. This begs the question: Is this union expansion necessary?
Those in favor of the “influencer agreement”, and unions in general, point to worker protections, specifically benefit coverage for those not considered the typical employee. As personal brands, these influencers are not employees to any larger company, thus operating as a kind of independent contractor. As such, their access to benefits was limited before they had the ability to unionize. It is worth noting however, that in 2019 31 percent of influencers were between the ages of 18 and 24. Under current law, health insurance plans cover child dependents until they are 26-years-old, so for many, lack of benefits are not an immediate concern, especially considering their income which can range from $20,000 – $30,000 per sponsored post, more than a minimum wage earner may expect to see in a year.
The alternate side of the conversation argues that unions try to control labor supply in order to increase wages. In theory, higher wages seem preferable but it also means inflation to the cost of labor. As this occurs, fewer jobs become available in the industry leading to higher rates of unemployment, layoffs, and greater losses for the rest of society. It was indicated in a recent study that brands are now willing to spend $15 billion on influencer marketing. This is an increase of $7 billion since 2019, suggesting that the marketing industry will see an increase in interested workers and wages.
Unions also act as a monopoly, especially SAG-AFTRA, Hollywood’s most popular union. They face no competition and can therefore set their own rules and collections. In this format, workers would earn less revenue or face potential unemployment without the union, but within they are bound to their rules associated with membership. The 20% minimum required payment will be an added expenditure for these creators and they will face restrictions imposed by the union, such as the inability to move their content from an online advertising platform to other areas of the union’s jurisdiction like TV or traditional commercials.
For influencers who are free to work with whomever they want as an individual brand and who make more money in one post than some workers their age make in a year, a union is not a necessity. This is especially true now, as they have been some of the few workers who have been able to maintain safe work throughout the pandemic. Though it may offer them access to health and pension benefits, it requires a binding agreement to union specified collections and rules, and may make the marketing industry harder for other young talent to break into by increasing costs and wages.