Even before the boxes were unpacked in his new Beehive office, Iain Lees-Galloway was scrambling to soothe jittery movie producers, to avoid losing one of the most costly films ever to be made in New Zealand.

Despite Labour Party commitments to repeal the so-called "Hobbit Law", introduced in a whirlwind of controversy by John Key and his Government in 2010, the new Workplace Relations Minister is taking a far more circumspect approach than some movie executives had feared.

After some trepidation about what the Government would do to the country's film industry laws, one insider confirmed to the Herald this week that the $150 million Disney production Mulan has been given the green light, and will indeed be made at Auckland's revamped Kumeu Film Studios.

The tale of a sword-wielding Chinese heroine will be directed by Whale Rider's Niki Caro and, after some controversy over the ethnicity of the female lead, producers have bagged the star power of Chinese actor Liu Yifei.

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Chinese actor Liu Yifei will play the lead in the upcoming Disney film Mulan, to be filmed at Kumeu Film Studios in Auckland. Photo / file
Chinese actor Liu Yifei will play the lead in the upcoming Disney film Mulan, to be filmed at Kumeu Film Studios in Auckland. Photo / file

Eager to distance himself from the previous Labour plan - before Lees-Galloway took up the portfolio - to repeal the law outright, the minister says he wants to restore Kiwi actors' and crew members' right to bargain collectively and be assured of fair employment terms. This will not necessarily mean a repeal.

To that end, the minister is organising a working group of players from all sides of the movie industry - a business Lees-Galloway describes as a "complete anomaly" in New Zealand because of the extremely fluid and varied nature of the work involved.

But with so many competing interests, and the furore that accompanied the Hobbit Law's hasty introduction, the Government has a tightrope to walk to ensure any changes don't scare off the film studios, or attract the wrath of local film workers.

The Employment Relations (Film Production Work) Amendment Act - invariably referred to simply as the Hobbit Law - was brought in by the National-led Government because of fears that New Zealand might have lost Sir Peter Jackson's blockbuster Hobbit trilogy to another country.

It meant Kiwi film workers were contractors by default and could not legally bargain collectively. Previously, workers could potentially disrupt a production by testing their employment status and, if confirmed as employees, start collective bargaining. The big studios, Warner Bros in particular, didn't like that uncertainty.

Many actors and unions were outraged over what they saw as a denial of their basic employment rights.

However, others working in the industry were equally upset at the prospect of movie jobs vanishing overseas, and some movie fans were furious with the actors for potentially depriving New Zealand of the chance to make the films, with all the benefits they would bring to the country. According to Statistics New Zealand's Screen Industry Survey, film production revenue more than doubled to over $1 billion in the 2015-16 financial year.

Many New Zealanders came out in support of Sir Peter Jackson and producers of the Hobbit trilogy amid fears it could be taken offshore. Photo / file
Many New Zealanders came out in support of Sir Peter Jackson and producers of the Hobbit trilogy amid fears it could be taken offshore. Photo / file

Jackson and the Government claimed the actors' complaints could derail the production and force the film-makers to send the project to a country that would welcome the tens of millions of dollars it would bring.

After "a nasty and embarrassing moment in New Zealand history" - in the words of the actors' de facto spokeswoman Robyn Malcolm - the Government pushed the law through, with all three films ultimately being made here.

Has the Hobbit law worked?

It depends who you ask. The film crews are happy with it, according to their union, the Screen Industry Guild, because it gives them the flexibility of being independent contractors, meaning they can opt out of working on a men's undies advert to work on a three-year feature film.

But the actors don't like it, says their union, Equity NZ, because there are no binding minimum employment standards available to their members.

The Screen Production and Development Association (SPADA), which advocates for producers, has remained tight-lipped about the upcoming negotiations, but has been a staunch advocate of the legislation in the past, due to the amount of work it says the law brings into New Zealand.

All parties spoken to by the Herald seemed optimistic about the upcoming negotiations, praising Lees-Galloway for bringing all sides into the loop right from the outset.

"The whole point of the working group is to look at what is the best way for us to make good on that commitment in a way that restores fairness for the people working in the industry but is also fit for purpose for the industry," the minister says. "Whether it should be a repeal, an alteration, or what legislative instrument we might use, is exactly the question that the working group is going to look at."

A key issue, he says, is whether it is possible to introduce collective bargaining without a full repeal of the law. Another question is how to enable collective bargaining without workers having to go through the tedious process of negotiating contracts for every single production they work on.

With some film workers wanting to become full employees, and others happy to stay as contractors, the working group will also assess whether it's possible for some arrangement to cover both.

"If film workers have the right to bargain collectively, regardless of whether they are an employee or a contractor, then that really deals with that issue," Lees-Galloway says. "This is certainly not an exercise in diminishing people's rights; this is an exercise in restoring people's rights, but doing it in a fashion that is fit for purpose for the industry."

As far as the people actually making the movies are concerned, the minister says they weren't worried about money - but they were worried about uncertainty. No studio wants to end up in court disputing the nature of an employment relationship when all they want to do is make movies, he says.

"The concern that has been raised is that if someone who is deemed to be a contractor ... mid-way through a production wants to test the nature of their employment [in court], that's the uncertainty that producers want to avoid."

Lees-Galloway says he hasn't been directly in touch with big film companies such as Warner Bros, but is aware that New Zealand producers such as Barrie Osborne have been in "close communications with Hollywood and let them know that everything was under control".

Despite all the competing interests that reared their heads in such an ugly fashion in 2010, the minister is confident a consensus can be reached among all those involved.

"The impression I get is that the crew are largely contractors and by and large that works for them," he says.

"The actors would rather have the opportunity to be members of their union and for them the current situation is not working so well. What we want to make sure is that we get to a position where everybody feels comfortable with the law, everybody feels comfortable that their rights are being upheld and that they have the opportunity to bargain for a fair deal."

The minister hopes to have the working group's recommendations by around June 2018 and, if legislative change is required, take that to Parliament by the end of next year.

Meanwhile, Minister for Economic Development David Parker says the Labour-led Government currently has no plans to do away with the New Zealand Screen Production Grant - the "sweetener" National introduced to lure more big-screen productions to this country.

In this year's Budget, the former National Government allocated $303.9 million to support the continuation of the screen industry production grants over the next four years.

Actor Jennifer Ward-Lealand speaking to the media in 2010 following union negotiations over the Hobbit. Photo / file
Actor Jennifer Ward-Lealand speaking to the media in 2010 following union negotiations over the Hobbit. Photo / file

Equity NZ, formerly known as Actors Equity NZ, which Sir Peter Jackson previously accused of threatening the continued filming of the Hobbit in New Zealand, appears to be taking a far more conciliatory approach than it did in 2010.

Union industrial officer and organiser Melissa Ansell-Bridges says that while the current system "is not working", it is "entirely possible to find one that does work for everyone".

"The collective bargaining that we're talking about is not necessarily going to look like the collective bargaining as it exists in other professions outside of this industry, so we're not necessarily talking about everybody becoming an employee," she says.

"We do need to recognise that there is a huge difference between the conditions of work that arise from being an employee versus being an independent contractor."

A big challenge will be how to potentially "hybridise" such standards so they can apply to both employees and contractors.

A lot of water has passed under the bridge since Actors Equity NZ clashed heads with Jackson and the producers. They last month released a joint statement with SPADA and other organisations saying they have agreed to work constructively with one another "to ensure that all the diverse interests associated with the sector are fairly represented".

In an additional statement, SPADA says it "remains focused on ensuring the NZ film industry continues to grow and thrive, both in terms of domestic and international productions".

The Screen Industry Guild, which advocates for the country's screen industry crew and which supported the 2010 Hobbit Law, is also optimistic that all parties can be satisfied.

Policy adviser Penny Tucker says she is pleased that the pre-election rhetoric around the Hobbit Law didn't translate into "rash action".

"One of the things we were discussing with the minister was the need to maintain flexibility in the work conditions which the production people are really, really happy with at the moment."

She warns that there are now "tonnes" of countries ripe to take on productions that would have otherwise gone to New Zealand, so it is vital to make this country the most attractive prospect.

"It's all very well to aspire to change labour conditions but it's totally irrelevant if you don't actually have the jobs for people to work at," Tucker says.

"Our key goal is ensuring that everybody who's thinking about bringing producing to New Zealand understand that it's business as usual."

Other parties invited to join the working group include the New Zealand Writers Guild, the Screen Composers Guild of New Zealand, Women in Film and Television, Pacific Islanders in Film and Television, Ngā Aho Whakaari, the NZ Game Developers Association, Film Auckland, and key industry player Weta Digital.

The digital visual effects company's human resources manager, Brendan Keys, says it is happy with the status quo, where its 1700 or so employees are classed as independent contractors, but is keen to be involved in the working group.

Employment lawyer Sam Houliston says if there are any amendments to the definition of an employee, or to provisions relating to the bargaining process, these will need to go through the usual parliamentary processes and potentially face political opposition.

"It was horrible. Having said that, I'd do it again": Robyn Malcolm

Robyn Malcolm does most of her work overseas now, but says if New Zealand actors had better employment conditions, she'd be back in a flash.

The well-known Kiwi actor became the de facto spokeswoman for actors opposing the 2010 Hobbit Law - a role which saw her receive vitriol not only from the film industry establishment, but also segments of the New Zealand public, who saw her as working to deprive the country of the opportunity of a lifetime.

"It was a deeply unpleasant time; it was horrible," she says. "Having said that, I'd do it again."

Actor Robyn Malcolm received death threats for protesting against the Hobbit Law in 2010. Photo / file
Actor Robyn Malcolm received death threats for protesting against the Hobbit Law in 2010. Photo / file

Malcolm believes the law has had no effect on the number of films made in this country.

"I think the only thing that makes a scrap of difference to productions coming here is the New Zealand dollar," she says.

The law's only impact, she believes, has been to drive Kiwi actors overseas in their droves after they got "a punch in the solar plexus".

"All my work now is pretty much in Australia, unless I'm doing something very specific here because the conditions are so much better."

Would she do more work in New Zealand if employment standards improved here? "Hell yes," she says, adding the same is true for many New Zealand actors.

"The cornerstone to any changes to the Hobbit Law needs to be the ability to bargain collectively," Malcolm says.

"People in my industry, we are so, so easy to exploit because we're desperate to work - everyone wants to work. And there's a whittling away of the conditions under which we're prepared to work which has been going on for decades now."

Recalling the protests of 2010, which she has largely tried to block out, she says it was highly stressful for her and other New Zealand actors - and frightening at times.

"The fallout in terms of how the New Zealand public perceived New Zealand actors, that there was somehow this belief that we were these selfish, money-grabbing narcissists when in fact the average income of a New Zealand actor a couple of years ago was about $15,000.

"I thought it was incredibly embarrassing that those Warner Bros guys could turn up on the doorstep of our Parliament building and get labour laws changed. And that was reported around the world and it was humiliating for us as a country."

Malcolm hopes things will change for the industry under Labour and that actors, crew and producers alike can be satisfied by a rejigged law.

"I hope that everyone comes out smiling. Mostly, I hope that actors can come out smiling and feeling supported and strengthened by these new laws, and supported by the New Zealand Government."