Wage increase, pension gain seal pact between guild, congloms

With no fanfare or fuss, Hollywood’s performers unions have reached a deal with the congloms on a three-year master contract for film and primetime TV — setting the likely template for upcoming negotiations with directors and writers.

The Screen Actors Guild and the American Federation of Television & Radio Artists reached the tentative agreement at 1:40 a.m. Sunday after six weeks of below-the-radar talks. The deal, achieved nearly eight months prior to the June 30 expiration of the current pact, is certain to be used as a springboard for SAG and AFTRA’s leaders to push for a merger of the two unions in coming months.

Key gains include a 2% annual wage increase and a 10% hike in employer contributions to the pension and health plans, which boosts the overall figure from 15% to 16.5% — which the unions touted as the largest gain in two decades in an area where the hikes have been sporadic.

If ratified by the unions’ boards and its members, the deal will go into effect July 1.

The 2% wage hike falls short of gains in master contracts from the previous round in 2007-08, but is in line with what the congloms are offering amid an uncertain business outlook, with studios and nets contending they haven’t fully recovered from the recession.

The Alliance of Motion Picture & Television Producers signaled over the summer that it was taking a hard line on wage hikes when it told Teamster drivers it would be willing to take a strike over the 2% figure. The Teamsters agreed to a deal in late July with the 2% hike rather than going ahead with a work stoppage.

The focus now shifts to the Directors Guild of America, scheduled to start talks around Nov. 15. Gil Cates, head of the DGA’s negotiating committee for the fourth consecutive time, has emphasized to members in recent months that pension and health contributions will be a major focus in the talks while stressing that capturing new-media revenues remains elusive at this point.

DGA president Taylor Hackford issued a brief statement of congratulations to SAG and AFTRA, adding that the DGA will study the details of the pact closely.

The DGA has tended to reach deals in far shorter periods, and its leadership has long touted its strategy of coming into bargaining with a focused proposal. The directors have had strong backing from the 14,000 members, with no discernible dissent emerging over the past decade.

The current DGA deal expires June 30. It’s quite possible the DGA pact could be wrapped up before the holiday season, leaving only the WGA — which staged a raucous 100-day strike before signing its current accord in February 2008 — still to be determined.

The outlook for the writers is less clear cut — and probably far more bumpy. Two weeks ago, the WGA West outlined its key issues as better pay for pension and health, basic cable and new media, and improved working conditions for scribes.

The WGA master contract expires May 1, but the guild and the AMPTP have yet to set a start date for negotiations. John Bowman and Billy Ray are co-chairs of its negotiation committee; Bowman chaired the negotiating committee during the lengthy and contentious contract talks with the AMPTP, which began in July 2007 and didn’t conclude for seven more months.

The WGA has tended to opt for starting negotiations closer to expiration than its counterparts, based on the idea that doing so improves the odds of achieving the best deal.

In 2001 and 2004, the WGA deals were negotiated after the contracts expired. And in 2007, talks didn’t start until three months prior to expiration, and went nowhere due to profound disagreements on new media and residuals, with the companies launching negotiations with a proposal that the WGA agree to ditch the residuals structure in favor of a profit-based system — adding fuel to the notion of going on strike, even though the residuals proposal was withdrawn before the strike started.

The SAG-AFTRA strategy of negotiating more than half a year prior to expiration mirrors the DGA’s preference for making a deal without an expiration looming. That strategy reflects the notion that the congloms will opt for the best terms at that point in exchange for the assurance of labor peace.

The AMPTP issued a brief statement Sunday noting, “The early agreements also ensure that production can continue without disruption for everyone who depends on this industry.”

Reaching a deal this early represents a marked contrast for SAG, which held out for nearly a year past expiration in the previous round in hopes of sweetening terms that the DGA, WGA and AFTRA had achieved.

That strategy — executed at the behest of then-SAG president Alan Rosenberg and national exec director Doug Allen — proved unsuccessful, and saw Allen fired by the national board amid assertions by self-styled moderates that he had bungled negotiations, while Allen’s supporters blasted the moderates for refusing to seek a strike authorization. Squabbling between AFTRA and SAG led to the unions opting to ditch joint negotiations for the first time in more than 25 years.

Since then, Rosenberg’s Membership First faction has lost much of its power to moderates, and current SAG president Ken Howard and his Unite for Strength allies have made repairing relations with AFTRA and seeking a merger the signature issues.

“Strengthening the pension and health plans was our top priority in these negotiations — making such a significant gain in that area was a vital achievement,” said Howard in a statement.

Employers’ contributions to union pension and health plans are calculated as a percentage of the total compensation paid to members of that union. For the DGA, employers contribute an additional 14% of the total compensation paid to directors to the DGA plans — 8.5% to health and 5.5% to pension for the DGA. The WGA receives 14.5% (8.5% health, 6% pension), while SAG receives 15% (9.25% health, 5.75% pension) as does AFTRA (9.75% health, 5.25% pension).

The exact amounts for health and pension that will be allocated from the 16.5% employer contribution will be determined by trustees of each plan. Those plans are operated separately from the unions and are overseen by a board comprising equal numbers of reps from the companies and the unions.

A source with knowledge of the talks said the SAG allocations will be 9.75% for health and 6.75% for pension.

The new SAG-AFTRA deal also provides for two additional background positions in features and one additional background position in TV in the Western Zones; an expansion of major role provisions to apply to new pay TV series in their second season; expansion of coverage over made-for-new-media productions; improved contract language designed to increase equal employment opportunities; and modifications in travel provisions.

The boost to the health plans comes two months after the SAG health plan notified its 40,000 participants it would be cutting benefits, hiking premiums and tightening eligibility next year (Daily Variety, Sept. 13). The plan disclosed that it was facing a $30 million deficit this year with projections of a $50 million deficit next year.

The SAG-AFTRA tentative agreement doesn’t include specific language covering actors working on motion-capture sets in pics such as “Avatar.” The “mo-cap” proposal was formulated during the summer as part of several dozen “wages and working conditions” meetings for members.

Aside from those meetings, the unions made no effort to mobilize members on any issue — much less set the stage for a strike authorization vote. Howard and AFTRA prexy Roberta Reardon have largely limited their public statements this year to asserting that the two unions need to merge.

SAG members voted down merger proposals in 1999 and 2003, while AFTRA members supported merger in both votes. The SAG vote in 2003 fell short of the required 60% “super-majority” as opponents raised questions over maintaining SAG’s identity and concerns about merging the health plans.

SAG has 120,000 members and AFTRA has 70,000 member
s, including broadcasters and singers; about 45,000 thesps are dual members.

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