I've seen the management side of this interaction. They had 0 leverage. I can bet money the answer is "fire them and push back the release if needed'
Edit-
And i will say that while i find these practices deplorable it is very much a problem that the market has so many people willing to do it. On the one side you absolutely have companies trying to make sure this continues to be the status quo(which is where the shady shit comes in, see disney being sued by animators), but the whole reason it's this way in the first place is simply because there's more than enough people who are willing to work their "passion" and will be treated like trash doing it.
Exactly, you nailed the underlying cause. Excess supply of labor/workers for a given job results in too much competition for available positions, so workers lose leverage. People can talk about contractors unionizing, but those contractor positions are a) less integral than the FTEs, b) easier to fire and replace during a strike, and c) easier to offshore if push comes to shove.
Interestingly, my friend who used to work in video game QA and left because of all the reasons already discussed now does QA for a server company. Guess what? Similar work, but better pay, work/life balance, and career advancement. Why? Because waaaaaay too many people apply for video game QA because they want to break into the game industry, and fewer people are motivated to work on servers or server software.
This phenomenon is also referred to as "intrinsic value" in a job, where more workers are drawn to a certain job because of value beyond pay, i.e. job enjoyment (think fire fighters, teachers, police officers, park ranger, actors, etc.). The problem is a lot of people assume QA and other jobs in video games in general will provide that intrinsic value, so they agree to work for poor compensation, and then find out there isn't enough enjoyment in the job to offset the low income and benefits, and the odds for career advancement is less than they anticipated. Up until recently new workers didn't know how bad things were until it was too late, so at least the media attention is giving prospective workers the opportunity to make an informed decision.
In the meantime, there's currently very poor balance between labor supply and demand in this market. That doesn't change the need for better laws and regulation regarding contractors. But there will always be fundamental and underlying problems as long as excess labor supply exists.
I'll make one last comment about NRS before departing this thread, since it's devolving into people spouting naive rhetoric. Very few organizations, whether companies, governments, unions, or whatever, are 100% purely good or purely evil. Even the best have flaws, and what we learned is that NRS has a flaw that's consistent with practically every other triple A developer. That doesn't automatically negate the good they do. The diversification of their roster, of helping to break down gender stereotypes in fighting games, of producing a quality product (with some flaws of its own) on a regular basis. And while they have issues with contractors, they also converted 16bit from QA contractor to FTE, made him a regular lead in their Kombat Kasts, gave him a platform to become a minor video game celebrity, and this year began featuring additional QA analysts on the stream. How many studios have provided that same opportunity for anyone in their QA staff?
Raising general awareness of the plight of contractors in this and other industries is productive. Specifically raking NRS over the coals is not.
Edit: Typo
