Three Big Mistakes To Avoid When Negotiating Overscale

Adaptistration People 010Part of my traditional consulting includes providing direct negotiation services and/or providing negotiation counsel and support for musicians, executives, music directors, and boards seeking to create or amend an individual work agreement. For musicians, these are colloquially known as overscale contracts and among those three stakeholders, it isn’t unusual to see a musician inadvertently limit his/her potential earnings due to falling victim to one or more of these three common bear traps.

If you aren’t familiar with individual overscale agreements, these are the contracts that certain orchestra musicians utilize to negotiate terms above and beyond those set forth in the collective bargaining agreement (CBA). They are negotiated outside the auspices of the CBA between the musician and the association. In short, individually negotiated overscale is the vehicle that allows orchestras to be competitive when attracting and retaining specific talent. 

1) Thinking The Best Time To Negotiate Is When You Receive Tenure

Mistake 1This is perhaps the most common mistake and it shouldn’t come as any surprise since human nature skews toward playing safe until you cross a certain level of security. There are plenty of generally good reasons why that rationale makes sense but when it comes to professional orchestras, an employer has greatest leverage in a negotiation when they know an employee feels safe, relieved, and looking to get comfortable.

Simply put, a musician is less likely to walk away from an offer and a position once s/he has pulled up roots, signed a lease or purchased a home, made new friends, etc.

Consequently, the optimum time for new hires to negotiate is at the point the employer makes an initial offer (hopefully, via a written letter of intent). In this scenario, the employee retains more leverage because there’s less risk related to turning down an offer*and increased flexibility in negotiating time-specific ancillary terms such as moving expenses. The employee also has more options with crafting a structured agreement that contains both pre and post tenure terms and conditions.

Perhaps unsurprisingly, there are exceptions to the rule but by and large, the best time to negotiate is at the point where you win an audition.

*Yes, the odds of earning a position in a professional orchestra aren’t favorable and to some, it may seem unthinkable to turn down a job offer after winning an audition but it happens more than you might think and in my professional opinion, would do the entire field good if it became more commonplace.

2) Assuming Something Is Non-Negotiable

Mistake 2There’s quite a bit more to negotiate than just dollars and cents; indeed, it isn’t unusual to encounter big differences in negotiable items from one instrument to another (do you have any idea how much freaking time and money double reed musicians spend on reeds?). By and large, most employers are amiable to discussing pretty much any term and smart employers are thoughtful enough to know that something which seems insignificant to them may hold a great deal of value to the individual musician.

Consequently, what they want is an employee that consistently brings his/her A-Game to the stage and be a positive influence on off and on stage colleagues. Sometimes that means including one or more items that aren’t common among other musician’s individual agreements, so if a musician can secure one or more terms so that it becomes a win-win scenario (i.e. doesn’t cost the employer anything out of pocket nor does it require the musician to bargain away other terms in order to secure), all the better.

3) Failing To Read the Collective Bargaining Agreement

Mistake 3Although this has always been good advice, it has become increasingly important in recent years, especially among higher budget ensembles thanks to more and more musicians ratifying master agreements with terms that provide lower levels of wages and/or benefits for incoming musicians.

For instance, in order to protect an existing term or minimize a concession, existing musicians agree to terms that provide incoming musicians with lesser conditions; for example, paying musicians hired after a certain date a lower seniority scale.

Something like seniority provides all musicians with a fixed pay increase at regularly scheduled retention thresholds (e.g. five years = extra $20/week, 10 years = extra $25/week, etc.) but since the economic downturn, it is increasingly common to see terms where new hires are paid lower rates and/or prescribed longer thresholds. For a musician that remains with an ensemble 20 years or more, this amounts to being paid tens of thousands of dollars less for doing exactly the same work and absorbing identical responsibilities as colleagues who were simply hired at an earlier date.

Reading the CBA will help identify any potential wage and/or benefit inequalities that should, in turn, be addressed as a bargaining item.

Conclusions

Adaptistration People 019To date, I’ve lost track of how many hours spent reviewing the above items with clients so it seems like a good move to not only save some time down the road but hopefully help prevent a musician employee from unnecessarily missing out.

Perhaps unsurprisingly, there are a number of other bear traps to avoid (failing to get offers in writing, neglecting to read final language, conducting all bargaining via email, accepting initial offers out of hand, etc.) but these three are among the most common errors, not to mention some of the most costly.

In the end, these items cover general situations and you should always consult with an experienced professional in order to determine the best course of action for your unique situation.

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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9 thoughts on “Three Big Mistakes To Avoid When Negotiating Overscale

  1. Thanks for this article!

    About the aside “do you have any idea how much freaking time and money double reed musicians spend on reeds?”– do you know any cases where a musician has successfully negotiated for some kind of reed pay? Or was that just an example of the different workloads between instruments?

  2. Hi Anna, thanks for your questions and the short answer is yes, that is possible and happens for my clients more often than not. Having said that, it is far less likely to end up with an agreement that spells out any sort of remuneration as some sort of line item reed expense. Instead, it is typically accounted for in other ways.

  3. I’ve always wondered about this side of the business, thanks for addressing it. When you say that the best time (usually) to negotiate is after having won an audition, does that also apply to musicians hoping to improve their individual contract with their current orchestra? i.e. a musician in orchestra X who wins an audition in orchestra Y but really just wants to use that job offer to negotiate a better individual contract with (and remain in) orchestra X?

  4. Thanks another great question and yes, the point in the article about the best time to negotiate is geared toward a new hire scenario. When applied to veteran musicians, it is a bit less straightforward thanks to an uptick in the number of potential variables involved. The scenario you described (using a job offer from a different institution) is certainly one of the more common and most applicable when it comes to re-negotiating an existing agreement for a veteran musician employee.

  5. I would be surprised if that doesn’t happen at all of the larger budget orchestras 🙂 And on that point, I’ll often recommend to clients that it is worthwhile to take auditions at peer ensembles if for no other reason than to verify his/her value. Having said all of that, we can likely have a related discussion about how musicians should go about the process of using a competitive offer to initiate renegotiating an existing overscale agreement as I’ve encountered some real “worst case” examples over the years. But that’s the sort of conversation best left for face to face shop talk 🙂

  6. Useful post, Drew.

    How many US orchestras operate strictly under overscale rates laid out in the CBA, and do not offer additional overscale in any case?

    Is there data about what specific instruments make in overscale? Form 990’s are useful to an extent, but are limited by number of employees. I would be interested in finding out average overscale for each instrument.

    Thanks!

  7. That’s a good question, I don’t have a precise figure but I can say that it is a very small percentage (it is worth mentioning that AFM members are usually able to obtain a copy of a member orchestra’s CBA in order for you to check on an ensemble by ensemble basis, the same is true for orchestra executives). Granted, this issue varies across budget thresholds but it isn’t unusual for a CBA to contain minimum overscale amounts; for example, principal trumpet is paid an additional 20% over the base rate per week or per service. But that doesn’t preclude the individual musician from negotiating an individual agreement.

    It’s common to see those minimum overscale amounts used as a firm method for determining move-up pay and or the more unusual instance of a substitute coming in for an instrument that doesn’t have multiple members (tuba, harp, etc.).

    But it is far less likely to see a CBA with language that outright prohibits or caps overscale. Having said that, the employer is under no obligation to entertain requests to bargain (or even offer) individual agreements.

    There is no single repository of overscale amounts although you are correct, you can sometimes find the monetary portion via an IRS Form 990; but this is increasingly rare following the IRS updates to those forms that increases the min reportable amount to $100,000 and only for the top five highest paid employees. In those cases, you’ll find one or a few musicians in very high budget ensembles but that becomes less likely as budgets decrease.

    But one word of caution: the 990s do not provide any details whatsoever about how those figures are calculated and what they include. For instance, a musician may have a maintenance expense wrapped into that figure which, in turn, is determined by providing the employer with receipts. As such, that shouldn’t be considered wage income from a purely overscale perspective, make sense?

    Interestingly enough, The League of American Orchestras does provide employers with aggregate overscale data if requested. Here is how they describe the process via their Antitrust Policy:

    Q. Many of my musicians negotiate individual overscale agreements. How can I learn what individual musicians are typically paid?
    A. You should not share in oral or written form compensation or benefits committed to any individual. If desired, the League is willing to collect this information by position (principal trumpet, section strings, etc.) and provide it to executive directors of participating member orchestras in a format and aggregation similar to that of the Administrative Staffing and Compensation Survey.

    Based on that information, it would indicate that most of the relevant details in the aggregated data are filtered out and would therefore make the data useless.

    I am unaware of any similar efforts on the part of the AFM to catalog individual agreement terms.

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