Atlanta Symphony Locks Out Musicians (again)

In 2012, the Atlanta Symphony Orchestra (ASO) musicians were locked out after refusing to accept sharply concessionary terms. Approximately one month later, the musicians ostensibly caved and agreed to large reductions in wages, number of musicians employed, and a decline in weeks from 52 to 41. Two years later, that agreement has expired and the musicians have refused to accept an agreement that is, yet again, filled with additional concessionary terms even though the orchestra’s parent organization, Woodruff Arts Center (WAC), surpassed their most recent annual fundraising campaign and the ASO has trumpeted fundraising success to the tune of $5.5 million in corporate and anonymous donations since 2012.

ADAPTISTRATION-GUY-113Shortly after the agreement expired the musicians released a statement asserting that the WAC’s principal bargaining representative, ASO President & CEO Stanley Romanstein, refused to meet with musicians during the latter half of the final day of the agreement nor did he respond to a musician proposal for preventing any interruption in scheduled performances and community activity via engaging in play and talk; a form of mutual agreement for continued operations where the terms of the previous agreement remain in force.

Read the Musicians' Statement

Atlanta, GA September 7, 2014 12:01AM

As of midnight September 7th, 2014, ASO President and CEO Stanley Romanstein had refused all requests to meet with the Musicians during the final hours before the 2012-2014 CBA expired, forcing them to submit their most recent proposal electronically. The Musicians emphasized in their proposal that they wish to avoid a labor dispute and propose to continue negotiating while working under the concessionary 2012-14 contract. The musicians have received no response; it appears that the Woodruff Arts Center has locked out the Musicians of the Atlanta Symphony Orchestra for the second time in as many years.

In over eight months of negotiations, the Woodruff Arts Center and ASO Managements have displayed no willingness to find a workable agreement. They have refused to meet in person during the final days before our existing contract expired, and obstinately cling to the concessionary terms of their “last, best, and final offer,” under which the musicians would continue to hemorrhage income and lose orchestra positions.

Stanley Romanstein publicly accused the Musicians of not being willing to explore alternative health care solutions. Not only is that claim false – but the Musicians have offered the WAC healthcare solutions that would yield a greater savings without cutting into musician compensation any further.

According to the last, best, and final offer presented by the Woodruff Arts Center, the WAC has $3.75 million dollars available to further reduce the size of the orchestra by one third through a voluntary retirement incentive, and yet they will not apply such funding towards an agreement that we can sign. $3.75 million dollars exceeds the amount necessary to fund the musicians proposed increases. This is a WAC attempt to forever deprive the orchestra of its ability to function in the first league of orchestras.

The WAC has not demonstrated through their actions an understanding in the last two years of what is required to sustain a great American Orchestra – either artistically or financially. Because of this, the musicians can not afford to give up control to the WAC in determining the size of the orchestra.

The cost of the compensation package of Atlanta Symphony Orchestra Musicians was $12.2 million dollars in 2012. The cost of the compensation package as outlined in the Musicians’ proposal of September 6th will be $11.68 million dollars in 2018, the fourth year of the proposed agreement. Under the Musicians’ proposal, the orchestra’s costs will be less in 2018 than they were six years prior in 2012.

As of the time this article was written, there has been no response to the play and talk offer and none of the statements from the ASO/WAC reference the option as a potential scenario. Nonetheless, the ASO/WAC did publish an extensive list of talking points that confirm the musicians are indeed locked out and will have their health care benefits cancelled at the end of September, 2014 if a new agreement is not ratified.

…although the musicians remain employees of the ASO, they will not receive a salary until a new contract is ratified. Health care benefits will continue through the end of September.

The same FAQ document states that the ASO/WAC are committed to continuing negotiations; however, there is no mention of considering play and talk or bringing in a mediator; either from the Federal Mediation Conciliation Service (FMCS) or a mutually agreed upon independent party.

Nonetheless, the ASO/WAC did manage to prepare the extensive bargaining FAQ along with releasing an official statement following the agreement’s expiration. In what might be defined by some as a curious decision, the statement references many of the same talking points from the 2012 dispute, including the need to develop a new business model when the last concessionary agreement was supposed to provide the necessary framework for doing exactly that.

“While we value the art and the artists of the ASO enormously, we believe we must develop a new model that will allow us to balance our artistic and financial needs, said Romanstein said. Clearly, that is not the model we have today.”

Additionally, the statement includes the same rationale used in the recent Metropolitan Opera (Met) labor dispute in that the ASO/WAC will be unable to rally ongoing contributed support unless the institution secures sought after measures in its most recent proposal.

The Atlanta Symphony Orchestra’s donor base has been very generous, especially considering the long-term financial trends of the ASO,” said Woodruff Arts Center President and CEO Virginia Hepner. “But, these donors have told us that we must balance our budget in order to expect continued support.

Nonetheless, the specter of donor backlash turned out to be a less than reliable concern in the Met dispute and neither the ASO/WAC nor any of their existing or potential contributor pool have yet to corroborate claims of donor backlash.

Read the ASO/WAC statement

Despite months of Collective Bargaining Agreement (CBA) discussions, the Atlanta Symphony Orchestra Players Association and Orchestra management have not reached an agreement on a new contract. As a result, the contract with the musicians’ union has expired, effective 12:00 midnight on Saturday, September 6, 2014. This development may delay or cancel portions of the scheduled 2014-15 season, which is set to open on Thursday, September 25, 2014.

Progress has been very slow, despite eight months of negotiations and ongoing transparency regarding the organization’s finances.

“We are all extremely disappointed that we do not have a new contract,” said Atlanta Symphony Orchestra (ASO) President Stanley E. Romanstein, Ph.D. “While we value the art and the artists of the ASO enormously, we believe we must develop a new model that will allow us to balance our artistic and financial needs. Clearly, that is not the model we have today.”

The ASO has had 12 consecutive years of deficit operations. In the recently completed 2013 – 2014 fiscal year, it had a $2 million deficit, even with a significant contribution from ASO Presents, the concert promotional arm of the ASO. Accumulated debt is approximately $5 million. The ASO endowment has declined to about $70 million today as the Orchestra has taken additional distributions of $18 million to cover its accumulated deficits.

The organization’s financial woes would be even more pronounced if it wasn’t a division of the Woodruff Arts Center (WAC). Conservatively, the WAC provides about $3.7 million in annual support by absorbing unallocated expenses and contributing to support the art. The ASO is one division of the Woodruff Arts Center which also includes the Alliance Theatre, Arts for Learning and the High Museum of Art.

“The Atlanta Symphony Orchestra’s donor base has been very generous, especially considering the long-term financial trends of the ASO,” said Woodruff Arts Center President and CEO Virginia Hepner. “But, these donors have told us that we must balance our budget in order to expect continued support. It’s really critical that we find a contemporary operating model for the ASO.”

In its most recent proposal, ASO Management offered to increase musician salaries by 4.5 percent over the life of a four-year contract plus a share (22%) of any budget surpluses. The proposal called for musicians to shoulder more of the costs for health care, in line with what ASO staff pays for its health care costs. Management has also proposed flexibility in determining how and when vacancies on the orchestra are filled in order to balance the artistic and financial needs of the orchestra.

Since the last contract was signed in 2012, expenses have declined but sales for the classical season have declined more dramatically as cost-conscious consumers favored single-ticket purchases over season subscriptions. This trend also put downward pressure on sponsorships.

ASO staff responded to these challenges by offering new purchase options, such as “build your own season,” and new formats like “First Fridays,” which are aimed to keep commuters in town after work with earlier concerts. In addition, ASO Presents, the concert promotional unit of the ASO, has dramatically increased the number of popular music concerts it produces in Symphony Hall, adding to ASO revenues. These adjustments have made a positive impact, but have not been enough to close the annual operating gap.

“We are pleased with some of the progress we have made over the last two years and we are grateful for the significant role the musicians played in helping reduce our costs. But we still have work to do to reverse the financial deficits that have been experienced for the past years,” said Atlanta Symphony Orchestra Board Chairman Karole Lloyd. “I remain firm in the belief that by working together — board, musicians, staff, and community — we will eventually achieve our goal: a vibrant, financially stable, world class Atlanta Symphony Orchestra which will serve this community for generations to come.”

“We are all musicians or music enthusiasts at the Atlanta Symphony, and we are all striving for the same thing — a thriving classical music community that will flourish for decades to come,” said Dr. Romanstein. “We hope we can return music to the stage very soon.”

In the end, this dispute is shaping up to be an ugly and prolonged affair but the Met dispute was looking similarly grim before managing to reach a mediated agreement that prevented any work stoppage. Barring any such developments here, we’ll take a closer look at both side’s proposals and what’s preventing them from reaching a deal in future articles.

About Drew McManus

"I hear that every time you show up to work with an orchestra, people get fired." Those were the first words out of an executive's mouth after her board chair introduced us. That executive is now a dear colleague and friend but the day that consulting contract began with her orchestra, she was convinced I was a hatchet-man brought in by the board to clean house.

I understand where the trepidation comes from as a great deal of my consulting and technology provider work for arts organizations involves due diligence, separating fact from fiction, interpreting spin, as well as performance review and oversight. So yes, sometimes that work results in one or two individuals "aggressively embracing career change" but far more often than not, it reinforces and clarifies exactly what works and why.

In short, it doesn't matter if you know where all the bodies are buried if you can't keep your own clients out of the ground, and I'm fortunate enough to say that for more than 15 years, I've done exactly that for groups of all budget size from Qatar to Kathmandu.

For fun, I write a daily blog about the orchestra business, provide a platform for arts insiders to speak their mind, keep track of what people in this business get paid, help write a satirical cartoon about orchestra life, hack the arts, and love a good coffee drink.

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