Guilds’ no-strike zone

DGA could lead way in upcoming contract scambles

Though Hollywood likes sequels, nobody wants 2005 to become a replay of 2001.

Three years ago, Hollywood suffered from severe work stoppages (even though there were no strikes) as a result of troubled contract talks. No one’s yet forecasting a similar nightmare scenario next year, but there’s plenty of angst: The Writers Guild of America contract expired two months ago, with no plans for talks to resume; the Screen Actors Guild and Directors Guild of America contracts expire in July 2005.

All three guilds (along with the Alliance of Motion Picture & TV Producers) insist they don’t want a strike. But the unspoken hope is that the DGA will be first up at bat and lead the way for SAG and the WGA in successful pact negotiations.

There’s reason for optimism. The DGA has a rep for being well organized in its contract negotiations. And while the guild is famously secretive about its plans, it’s being specific and surprisingly revealing in its demands.

DGA prexy Michael Apted this week is sending out a letter to 12,000 members, asserting that DGA leaders are dedicated to a fair deal and are cognizant of the “great value of stability in these troubled times.”

But there’s also a good measure of tough talk, an unmistakable warning that the helmers won’t be pushovers.

“If we are not successful in reaching an agreement that accomplishes our central goals, then we will take whatever steps are necessary to achieve them,” Apted writes. “No one, especially the producers, should underestimate our resolve. We have tough times ahead and we intend to get what we need.”

The directors’ stance is key to everyone. WGA members are loath to admit it openly, but they know that a writers strike won’t shut down the town. However, a strike by the directors or actors would do that, which gives great clout to the DGA negotiations.

While the three guilds have some common concerns — DVD residuals, reality TV, health & pension plan contributions — they are approaching things in wildly varying styles.

Perhaps most notably, the DGA talks will start long before the June 30, 2005, expiration. Though nothing’s set yet, negotiations are expected to begin in early fall. (The WGA has already predicted that the DGA will go ahead of SAG.)

Unlike the WGA’s approach of negotiating up against deadlines, the DGA traditionally sits down at the bargaining table long before expiration. The strategy is designed to create a better deal for the union in exchange for helping avoid the uncertainty derived from last-minute talks.

Observers say the DGA is probably going to be in better shape to handle negotiations for several reasons: It’s got former DGA prexy Gil Cates heading the negotiating committee; directors carry a reputation for unity; and the DGA has managed to avoid the internal disputes that have beset the WGA and SAG.

By contrast, the WGA has seen two presidents resign this year and will have its next presidential election overseen by the feds; at SAG, members have voted down three straight referenda pushed by the leaders, and SAG’s Hollywood board recently asked for CEO Bob Pisano to step down.

Three years ago, SAG and the WGA negotiated past the expiration of their contracts. Nervous studios and networks scrambled in early 2001 to speed up production and stockpile; once the guilds made deals, a de facto strike went into effect as production fell off a cliff for the rest of the year.

Key cause of the town’s current unease: the stalemated Writers Guild negotiations, with neither side willing to budge. The WGA contract expired May 2; contract talks broke off June 2, with no progress on any major issues. No new negotiations are scheduled; escalation is now a possibility through a strike by the writers or a lockout by the companies.

The WGA asked for a one-year extension of its contract, similar to the extension that the AMPTP gave to actors. In one sure sign of hostility, the AMPTP refused the WGA’s request. (Some even believe the extension granted to SAG was a retaliation for the WGA’s early aggression in campaigning for its demands. AMPTP prexy Nick Counter blasted the WGA’s demands as “a disaster waiting to happen.”)

The WGA admitted it won’t get an acceptable deal for many months and essentially handed off the ball to the DGA and SAG.

Despite two months of WGA contract talks, there was a complete lack of agreement on any major issue; that portends similar disputes at the upcoming SAG and DGA negotiations since many of the issues will be the same:

  • Studios don’t want to budge on DVD, where revenues have been soaring.

  • Pressure on the guilds’ health plans isn’t going away, with costs soaring despite the unions’ moves in 2002 and 2003 to cut benefits and tighten eligibility. The WGA and the AMPTP remain $30 million apart on increasing producers’ contributions.

  • Ongoing consolidation among mega-congloms and soaring filmmaking costs heighten their need to pay attention to the bottom line and resist guild demands.

For now, most expect the current truce between the WGA and the AMPTP will hold.

And there’s also another potentially large distraction looming: Leaders of the 4,000 studio drivers repped by Teamsters Local 399 have warned they will picket every production nationwide if they do not obtain an acceptable deal when their contract expires July 31.

“No one benefits from a de facto strike, as we were all reminded in the last round of negotiations in 2001,” Apted writes in his DGA letter. “We are going to do all we can to prevent a recurrence in 2005.”

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