SAG, AFTRA team for ad talks

Commercial contract expires March 31

Even as it preps for a strike authorization vote regarding features and primetime work, the Screen Actors Guild is planning to begin joint negotiations with AFTRA soon on a new contract with the ad industry.

The drama over a possible SAG strike has shifted the town’s attention away from the upcoming commercial negotiations. A start date for the talks has not been set, but the SAG-AFTRA contract with commercial producers, which has been extended twice, expires March 31.

The talks on the commercial contract will mark a return to solidarity at the contract table for the two thesp unions, which battled each other publicly earlier this year after negotiating separately with Hollywood’s majors on the feature-primetime contract. AFTRA members inked a new contract with the studios in July, while SAG has been mired in a months-long impasse and is attempting to secure the strike authorization from members next month.

Monday saw another round of attacks between SAG leaders and the congloms while the guild presses on with its campaign for the required 75% approval from those voting. SAG president Alan Rosenberg sounded a call for unity and unionism as part of asserting opponents should hold off publicizing their disapproval because doing so de-leverages SAG. Over 1,400 SAG members including George Clooney and Tom Hanks have gone public with their opposition.

“While your leadership is not always in agreement, we must all pledge to keep our disagreements inside the boardroom and not air our differences in the press,” he said. “We must all represent you with integrity and a commitment to stand together as we take on the huge global media corporations that want to break our union. We must stay true to our solidarity votes in the boardroom and true to our responsibility to better the lives of all SAG members and their families. Make no mistake, a house divided is doomed to fall.”

The Alliance of Motion Picture & Television Producers blasted back Monday by noting that SAG’s the only Hollywood union that’s failed to reach a master contract deal this year and noting that each contains pay gains and first-ever new media rights and residuals. And it urged SAG members to study the final offer, issued June 30 as SAG’s contract expired.

“We are proud to have made such important agreements even as the national economic crisis has worsened almost by the day,” the AMPTP said. “We sincerely hope that, before too much time passes in 2009, we will also reach a labor agreement with the Screen Actors Guild.”

Even while SAG was bashing the AMPTP throughout the fall, the guild and AFTRA quietly agreed to resume joint bargaining on the commercial contract. The unions also agreed to a non-disparagement agreement supervised by the AFL-CIO that includes the deposit of $2 million by each union to be paid out in fines for violations.

Earlier this month, SAG and the American Federation of Television & Radio Artists completed their “wages and working conditions” meetings with members to generate contract proposals. That package will be presented at a joint plenary in New York set for Jan. 9-10 and to be approved in February at a joint SAG-AFTRA board meeting.

Meanwhile, in a potential blow to SAG and its high-profile actors, the ad industry recently won a complex federal court ruling against SAG over how disputes on pension and health contributions from commercials are resolved. On Dec. 8, Judge Percy Anderson in Los Angeles threw out SAG’s lawsuit to overturn an arbitrator’s finding that pension and health contributions must be resolved by mandatory bargaining on a case-by-case basis, followed by arbitration rather than via a lawsuit by the P&H trustees.

The core of the ad industry’s complaint focused on advertisers paying a disproportionate amount — far more than movie and TV producers — into SAG’s P&H fund due to the presence of extras in movies and TV (but not ads) and the absence of contribution caps in the commercials contract. That means advertisers were required to make P&H contributions for actors making more than $125,000 per engagement, even when the actor’s compensation included “noncovered” services such as print advertising and public appearances.

The ad industry believes that the ruling — which upsets three decades of practice — will save it millions of dollars. Ad industry attorney Douglas Wood told Daily Variety that the key to the ruling was removing the ability of the SAG trustees to threaten a suit based on an alleged violation of the Employee Retirement Income Security Act.

“The consequences of an ERISA verdict are so draconian that advertisers would simply settle,” Wood noted. “Federal litigation has been inappropriately and unfairly used by the trustees as a sword of Damocles over the heads of advertisers. They will now have the ability to determine and resolve allocations in a fair, reasonable basis without threat of litigation or arbitrary deadlines imposed by the fund trustees.”

SAG and SAG P&H had no comment about the ruling.

In late August, SAG and AFTRA opted for a six-month extension of the commercials contract until March 31. The unions and the ad industry had agreed in 2006 to a two-year extension of the contract in order to allow Booz Allen Hamilton to conduct an independent study about changing revenue models in the ad biz due to the impact of new media.

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