Hollywood's majors have sent a clear message

With Sunday’s resolution of the contract tussle with the Teamsters, the majors have sent a clear message to other Hollywood unions: Dial down your expectations for the next round of labor talks.

The key deal point in the pact to cover 3,200 Teamster drivers in 13 Western states was the insistence by the Alliance of Motion Picture & Television Producers that they would not sway from the 2% hike in wage rates — and would be willing to ride out a strike by the drivers if they held out for a 3% increase. Though the contracts for drivers are very different from those with creative guilds, the dynamics that drove the Teamsters to cut a deal will cast a shadow on the negotiations that will begin Sept. 27 between the AMPTP and the two performers unions, Screen Actors Guild and American Federation of Television & Radio Artists.

The 3% annual hike used to be standard in the AMPTP’s deals. But since the global financial meltdown in fall 2008, the companies have adhered to capping salary gains at 2% or less in a dozen different agreements, although the Intl. Alliance of Theatrical Stage Employees achieved 3% in their most recent pact covering 15 Hollywood locals.

The majors’ resolve persuaded the leadership of Teamsters Local 399 to back away from the talk of a strike authorization vote and settle for a series of gains such as covering the cost of driver license and medical card renewals. That strike could have started as early as this Sunday.

The quick settlement of the Teamsters contract was the first big test for Carol Lombardini, who succeeded the late Nick Counter as AMPTP prexy last fall. Sources indicated Lombardini, the AMPTP’s longtime specialist in contract language, hit some rough patches during the talks in terms of maintaining a unified front but she also received high marks for her legal expertise in hammering out the pact.

AMPTP, SAG and AFTRA had no comment about the upcoming negotiations, which are set to run until mid-November when the DGA will have its turn at the table. The master labor contracts for SAG, AFTRA and the DGA covering feature film and primetime TV work all expire on June 30.

“The companies have clearly indicated that they’re united on holding down increases,” one insider said Monday. “It’s not that 2% is now set in concrete for all deals and that SAG and AFTRA can’t get 2.25% or 2.5%. But the fact that the Teamsters didn’t get 3% makes it much easier to make 2.25% a big deal if SAG gets it.”

One labor insider downplayed the significance of the Teamsters agreement on the contracts for creative employees because the needs and compensation terms for actors and other performers, directors and writers are so different than other showbizzers.

“Companies say all kinds of things when they’re negotiating,” said a top union exec.

Despite the prospect of production getting derailed by a possible Teamsters walkout, Sunday’s settlement came without any direct involvement of showbiz CEOs. That’s a far different scenario from the 2007-08 writers strike when Disney CEO Bob Iger and then-News Corp. prexy Peter Chernin took on extensive work to hammer out a deal, first with the Directors Guild of America and then with the Writers Guild of America.

SAG’s elected leadership has veered toward a far more moderate approach to negotiations, compared with the previous contract cycle. SAG was by far the most supportive union during the 2007-08 WGA strike, encouraging picketing by recognizable actors, and went into talks with the notion that SAG would hold out for a better deal than the WGA and DGA as the contract went nearly a year past expiration.

The moderates on SAG’s national board ran out of patience in early 2009, fired Doug Allen as national exec director and installed David White as his replacement. AFTRA had also split from SAG on the primetime talks and reached a deal in mid-2008 — over SAG’s vehement opposition — and has gone on to sign nearly every new primetime series.

Rank-and-file SAG members have supported the moderates in the past two elections to the point that the more aggressive Membership First faction, led by SAG First VP Anne-Marie Johnson, now has only about 40% of the board seats. The moderates of the Unite for Strength faction have also mended fences with AFTRA so that the unions are jointly negotiating again.

Still, several sources have warned that the diminution of Membership First’s power doesn’t automatically translate to smooth sailing with the congloms.

“There are so many moving parts with SAG and AFTRA because there are so many constituencies — stunt people, dancers, background, voiceover — and it’s difficult because the contract itself is very complex and actors can tend to get very emotional,” one noted. “I would not be surprised if they can’t finish by the middle of November.”

SAG and AFTRA have held more than two dozen “wages and working conditions” meetings with members since early June. They’ll hold a plenary on Aug. 21 and Aug. 22 to hammer out the details, followed by a Sept. 12 joint board meeting.

Looming over the coming talks is the fact that the WGA still hasn’t set a negotiations date with the AMPTP, even though its contract expires earlier on May 1.

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