Writers Guild Contract Talks Begin Amid Anxiety

The Writers Guild of America and the entertainment industry’s major studios are starting contract negotiations this week amid anxiety in the industry that the talks could lead to a work stoppage.

The talks are scheduled to begin Monday at the headquarters of the Alliance of Motion Picture and Television Producers, seven weeks before the current contract expires on May 1.

Both sides will probably announce a news blackout on the talks — which has become standard procedure over the past decade for the major Hollywood guilds since the acrimonious 2007-08 WGA strike. The WGA leaders have asserted that their 12,00o members have not seen their average earnings increase over the past 10 years.

“The $49 billion annual operating profit accumulated by the six major media companies with whom we will be negotiating is double what their profit numbers were only a decade ago,” the WGA wrote in a Feb. 9 letter to members.

“Contrast that with the economic picture facing the members of our guilds, whose average incomes in both features and series TV have actually decreased over that same decade. You’ve told Guild leadership in meetings and surveys that new models of development, production, and distribution — while making the companies richer — have not worked to your individual or collective advantage.”

The letter also said that members should contrast the companies’ prosperity with the state of guild’s Health Plan, which, due to rapid inflation in health care costs nationwide, has run deficits for all but one of the past four years, forcing a dip into long-untouched reserves.

AMPTP members have not commented on these assertions. The AMPTP has historically sought to stick to its “pattern bargaining” template, meaning it applies the same contract terms to the three major talent guilds: the WGA, the DGA, and SAG-AFTRA (which faces a June 30 contract expiration and has not yet set a date for negotiations).

The studios cut a three-year deal with the Directors Guild in December that included a threefold gain in residuals for original series on the largest SVOD platforms (such as Netflix and Amazon), and hikes for residuals of reruns from broadcast and cable on ad-supported streaming services (such as Hulu). That comes at a time when when broadcast network repeats, a major source of residual payments for members of all the guilds, have been declining.

The new DGA contract, which goes into effect on June 30 and covers 16,000 DGA members, was ratified by an “overwhelming” margin in January. The DGA contract is believed to generate about $110 million in gains for directors across all increases in residuals and standard percentage-gain minimums.

Working TV writers have been complaining at membership meetings about an array of issues: the trend toward shorter episode orders for TV series, which pay writers less than the traditional 22-episode season; exclusivity that studios require as a condition of staff employment; and the advent of the “mini writers’ room” as an alternative to the traditional pilot development process.

One proposal that surfaced as a result of the WGA’s membership meetings is the creation of a two-tiered scale system with higher fees for shows that run fewer than 22 episodes in order to make up some of the pay gap. A WGA effort to re-engineer the structure of the pay scale along multiple tiers is likely to be met with significant resistance by the AMPTP since the studios are grappling with the economic disruption of the transition of content to an on-demand world.

The WGA also needs a capital infusion from the studios to shore up its health plan. WGA members who earn enough to qualify for health insurance do not pay premiums for their high-end coverage plans — a luxury that even some writers say the guild can no longer afford.

The appetite among some of the WGA’s 12,000 members to push hard, even at the risk of a work stoppage, for big gains in the scale area is strong. Still, at one recent member meeting in Los Angeles, the first three members to speak all urged the leaders not take them out on strike.

The guild announced on Dec. 1 that it had selected Billy Ray, Chip Johannessen, and Chris Keyser to head its negotiating committee. It’s the second consecutive time that Ray (“Captain Phillips,” “The Hunger Games”) and Johannessen (“Homeland”) have been co-chairs of the negotiating committee.

WGA West President Howard Rodman and WGA East President Michael Winship are also on the negotiating committee. Lead negotiators are David Young, executive director of the WGA West for more than a decade, and AMPTP President Carol Lombardini.

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