With healthcare costs expected to dominate, Hollywood’s below-the-line unions have set March 5 as a start date for contract negotiations with the congloms — less than four months before the current master contract ends July 31.
The first round of negotiations with the Alliance of Motion Picture & Television Producers should last for several weeks. The unions — the West Coast locals of the Intl. Alliance of Theatrical & Stage Employees and Local 399 of the Intl. Brotherhood of Teamsters — are expected to negotiate jointly on healthcare and retirement issues while holding separate bargaining on the remainder of their contracts.
Reps for IATSE, the Teamsters and the AMPTP had no comment on the negotiations.
Both unions have ramped up their activity to heighten membership awareness on the specifics amid rising healthcare costs with a series of explanatory sessions for members, which have included presentations by healthcare expert and consultant John Garner and David Westcoe, exec administrative director with the Motion Picture Industry Pension and Health Plan. The Teamsters have scheduled a Jan. 22 town- hall meeting in Burbank, according to a message to members this week from longtime Local 399 secretary-treasurer Leo Reed.
“The cost of healthcare benefits has become one of the most important issues facing our members,” Reed said. “Costs of care and insurance coverage have been going up at an alarming rate for the last decade or more. Indications are that costs will rise an average of 9% to 10% a year for the next five years.”
Reed noted that the Motion Picture Industry Pension and Health trust, which administers the benefits package paid approximately $500 million in healthcare costs last year for actives and retirees.
“If the projections are accurate, next year’s costs for just health care will increase by approximately $50 million,” Reed said. “The $50 million more a year is just to stay even. There are also the increased pension cost, and the reduced reserves caused by the 2008 market crash.”
Health and pension have traditionally been among the top priorities for the unions, alongside salaries and working conditions, but the developments underline the uncertainty over health care amid a struggling economy.
“Health care costs have increased at a faster rate than anyone was able to predict,” Reed said in the missive. “All over the country, people have seen rising costs for medical services, doctor visits, tests, prescription drugs and hospital care.”
The Teamsters Local 399 covers about 3,200 drivers in 13 Western states and about 1,000 basic craft workers, while the IATSE deal covers 15 locals on the West Coast encompassing more than 20,000 members. The two unions entered into a formal alliance in August 2010 — two weeks after Teamster Local 399 drivers reached a deal with the AMPTP and synched up its contract expiration with the IATSE deal as IATSE president Matthew Loeb, who replaced the retiring Thomas Short in 2008 as the head of IATSE, has attempted to foster closer ties between the two unions.
Additionally, IATSE members are facing tightened eligibility to qualify for the health plan, which is overeseen by reps of the unions and the showbiz companies and funded from residuals and ancillary markets. IATSE agreed in 2009 to a hike in the eligibility threshold during the final year of the pact requiring that members work 400 hours over six months to qualify, up 33% from the previous 300-hour requirement — a change that stirred an uproar among below-the-line workers when the pact went out for ratification.
In the 2010 negotiations, Teamsters sought 3% in annual wage hikes but the companies insisted on a 2% wage gain, which the Teamsters accepted with several sweeteners along with the same 1.66% hike in benefits contained in the earlier IATSE deal. The Teamster deal set the template for negotiations in late 2010 and early 2011 with the Screen Actors Guild, the American Federation of Televison & Radio Artists, the Directors Guild of America and the Writers Guild of America — all with 2% hikes in minimums and all with the chief gain being an increase of 1.5¢ per dollar in employer contributions to the pension and health plans.
The Teamsters Local 399 contract is negotiated jointly with four other Basic Crafts unions: Local 40 of the Intl. Brotherhood of Electrical Workers; Local 724 of the Studio Utility Employees; Local 755 of Plasterers and Cement Masons; and Local 78 of Journeymen & Apprentices of the Plumbing & Pipe Fitting Industry.
Reed noted in his letter that the plans face the dual impact of rising costs and the aging of the industry’s population, leading to greater use of health benefits.
“Part of the blame for rising insurance costs is due to escalating costs for medical care, pharmaceuticals, and other health care expenses,” he said. “A new mandate in the federal health care overhaul is also a factor in making insurance more expensive, by allowing adult children to remain on their parents’ insurance policies until age 26.”