After a lengthy dispute over a union's attempt to represent some staff, a Halifax media production house is shutting down.

Halifax-based Egg Studios has announced it plans to close Nov. 6. In a post on Facebook, the owners — Mike Hachey and Sara Thomas — say they will not stay in Nova Scotia.

"Yesterday, Sara and I officially announced to all 20 of our employees that Egg Studios will be closing," he said Thursday.

"There will be no spin-off business and certainly no concerted effort to bypass the Labour Board ruling. We are done and saying farewell to Nova Scotia."

The company said over the next eight weeks, it will follow through on all ongoing work for clients.

More than three years ago, the provincial labour board ruled freelance film technicians had the right to be represented by a union.

'Worst nightmare of our lives'

The company argued the people were independent contractors. The firm fought the ruling in court, but the labour ruling still stands — after the Supreme Court of Canada refused to hear the case.

"What started as a dream more than 10 years ago has become the worst nightmare of our lives," said Hachey in a Facebook post.

Not having access to the province's Film Industry Tax Credit was another negative factor. Hachey had been lobbying to have the tax credit rules changed to include advertising agencies. That did not happen.

"Why is it that we can't take advantage of this tax credit? We use the exact same crews, we use the same actors, we support all of the same service providers," Hachey said in February at an annual general meeting of the province's Progressive Conservatives.

"We arguably put more into the local economy than any other production company in Atlantic Canada."

Hachey also said at the time that advertising agencies and clients were leaving Nova Scotia for markets elsewhere in the country.

Union reaction

Gary Vermeir, the business agent for International Alliance of Theatrical Stage Employees Locals 849 and 709, said he is saddened by the shutdown.

Egg Films, a Halifax media production house, says it is pulling out of Nova Scotia after a union collective agreement was imposed on the company. (CBC)

"We see this as a sad day, particularly given the state of the film industry today," he said.

Vermeir said the reason the union launched the unionization effort was so that its members would be classified as employees when working for Egg on TV commercial shoots rather than as independent contractors. The union classification already applies to film shoots.

That would have brought union benefits, such as employment insurance, workers' compensation, as well as medical and health coverage.

Those issues could have been resolved through bargaining, but the company backed away. "They locked us out and refused to bargain," said Vermeir.

Union members don't do a lot of work for Egg, he added.

Egg Films was the first business in the province to have a labour deal imposed under the first contract arbitration law, which imposes arbitrated settlements on first contracts for newly unionized workplaces. Under the law, which was passed by the NDP in 2011, the Labour Board of Nova Scotia can impose a contract when both sides fail to reach a first collective agreement.