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SAG, AFTRA OK modest ad pact proposal

A correction was made to this article on July 21, 2003.

The national boards of SAG and AFTRA have OK’d a modest commercials contract proposal, three years after staging the longest strike in Hollywood history over the pact, and told the ad industry they want to start negotiations as soon as possible.

In a Sunday joint meeting, the panels agreed unanimously to approve a three-tiered proposal package –incentivized for the ad industry to begin negotiations as soon as possible.

No details were disclosed by the unions, but those in attendance said SAG and AFTRA will seek the lowest package if the ad industry agrees to fast-track negotiations, while the value of the package will increase if the industry insists on full-blown negotiations.

Negotiations had been tentatively set to begin Sept. 3 in Gotham with an Oct. 29 expiration.

Ira Shepard, chief negotiator for the ad industry, told Daily Variety he could not comment on the proposal since he had not seen it.

SAG and AFTRA jointly negotiate the ad and TV-film pacts with SAG members generating about 90% of revenues on the ad pact and AFTRA’s slice coming from radio work. The SAG-AFTRA negotiating committee is composed of 13 reps from each union with SAG’s side headed by former Guild prexy William Schallert. AFTRA’s is co-chaired by Ron Morgan of Los Angeles and New York Local President Roberta Reardon

The unions, whose members generate more than $700 million annually in earnings under the contract, gave no details, but sources said the proposal includes the following:

  • an annual increase of more than 4% in “Class A” base rates for ads on major networks plus a slightly lower annual increase in cable buyout rates.

  • a hike in the current 13.3% contribution by producers to the unions’ pension and health plans.

  • a hike in Internet base rates. SAG and AFTRA have usually sought 5% hikes for Class A rates.

The decision to aim for a fast-track negotiation may reflect the desire of the leaders to avoid a replay of 2000’s bitter negotiations, which collapsed and led to a six-month strike.

Strike strife

Many supporters of SAG prexy Melissa Gilbert have contended that the strike was unnecessarily lengthy, with the unions taking overly aggressive positions such as calling for cable residuals. But her opponents have argued that a strike was inevitable after the advertisers took strident bargaining positions such as calling for elimination of Class A residuals.

Key points in the 2000 pact included retention of Class A residuals; setting aside $1 million annually to develop a monitoring system; fees of $1,500 a year for Internet ads; and impressive hikes in the quarterly cable buyout rates to $1,390 in the first year, $1,706 in the second and $2,460 in the third.

The monitoring system, which became an issue after SAG released a 1999 study asserting that 18 of 30 commercials had shortchanged actors by $388,000, has not been developed.

Gilbert and AFTRA prexy John Connolly issued a joint statement Sunday: “The joint board approved a clear and concise set of proposals. We stand ready to sit down with the advertising industry as soon as possible. We are committed to reaching an agreement.”

In another development, opponents of the SAG-AFTRA merger have called for a four-month study period to review alternatives to the narrowly defeated plan. Gilbert asked on July 10 for alternatives to the proposal to solve questions over jurisdiction in the area of shows shot on digital.

Goal: one set of contracts

The eight board members who voted against the deal in April — Tom Bosley, Seymour Cassel, Frances Fisher, Elliott Gould, Valerie Harper, Diane Ladd, Kent McCord and Esai Morales — said their general goals were to have actors work under one set of contracts, enhancement pension and health fund operations and reduce cost of union operations.

They also said they agreed with Gilbert’s statement that SAG’s focus should be on the commercials contract negotiations and the TV-theatrical pact, which expires June 30. The group also said that such ideas should be considered after the current SAG election, which concludes Sept. 23.

“We don’t want to have new ideas circulating which could be subjected to the abuse of an election process,” they added.

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