Health Care Plan Problems Take Center Stage in Writers Guild-Studios’ Contract Talks

WGA Writers Contract Talks
Jim Cooke for Variety

The halls of Congress aren’t the only place where a strenuous debate over the fate of health care has taken place this week.

The financial strain on the Writers Guild of America’s health care plan has been a central issue during the past two weeks of master contract negotiations between the guild and the Alliance of Motion Picture and Television Producers.

The guild is seeking a significant step-up in AMPTP funding for the plan, which is calculated as a percentage of WGA member earnings. The WGA plan, like SAG-AFTRA’s and the DGA’s, is administered by a joint committee of guild and management reps, and is known for offering generous coverage with little out-of-pocket expense from members who earn enough annually to qualify for coverage.

At present, that health care qualifying earnings threshold stands at a minimum of $38,302 within four consecutive quarters. Employers make a contribution to the health plan based on a percentage of earnings paid out to writers, although that employer contribution is capped after an individual writer reaches $250,000 in earnings on a single movie or TV program. The guild is asking to raise that cap to $400,000, which would translate to a big cost increase for the studios. For a half-hour pilot, the cap now stands at $170,000, and the guild is asking for an increase to $272,000. For a pilot longer than 30 minutes, the guild is looking to raise the cap from $225,000 to $360,000.

Earlier this week, it’s understood that AMPTP negotiators suggested that the WGA address the looming shortfall in part by adjusting its plan to a tiered system that would put limits around coverage options based on how much a member had contributed to the plan through his or her earnings. That suggestion was said to have raised immediate objections from WGA negotiating committee members. A source with knowledge of the situation said negotiating committee member Patric Verrone — the former WGA president who lead the guild during its 100-day strike in November 2007-February 2008 — was particularly vocal in his opposition to such a shift.

Multiple sources said the AMPTP quickly tabled the tiered system idea. But the wrangling over an increase in AMPTP contributions to the plan — and how those increases might be calculated — continues across the negotiating table at the AMTPT headquarters in Encino, Calif.

Reps for the WGA and AMPTP declined comment, in keeping with the news blackout agreed to by both sides as the talks began.

The guild and AMPTP may take a break soon after two weeks of bargaining that began on March 13. The guild’s master film and TV contract expires on May 1.

Sources said the general atmosphere in the room has been cordial and the talks have been productive. Sources said the AMPTP, led by president Carol Lombardini, has been careful not to put anything on the table that could be characterized as a “rollback” by the guild.

Sources said there is an awareness on both sides of the need for delicate handling of the talks, given the rising angst among mid-level TV writers about the earnings squeeze. With all the changes in TV, there’s more work than ever before, but many writers are having to work longer and harder to maintain a steady flow of income. The shrinking of the standard per-season series order has taken a bite, as has the extension of exclusive hold times that writers often face when working for networks that don’t adhere to the traditional September-May TV season. Proposals for easing the strictures of those hold times are among the 30 items on the agenda offered by the WGA.

The AMPTP is working off the template established in December with the Directors Guild of America, which includes gains in residual fees and minimums in the digital arena. Members of the DGA ratified the deal, which goes into effect on June 30, in January.

The biggest signal of how guild negotiating committee members feel about the prospects of reaching a deal will come if the WGA opts to conduct a strike authorization vote in the near future. That would amount to a warning shot to the AMPTP — as was the case a decade ago when members voted overwhelmingly to authorize a strike a month before the strike actually began.

But within the creative community there remains skepticism about whether WGA leaders and members are prepared to walk this time around. In 2007, members hit the streets after more than a year of preparation and organization for a work stoppage. This time around, there have been few public signs of a similar level of preparation.

SAG-AFTRA and the AMPTP have not yet set a date for negotiations on a successor deal. The performers union’s master contract expires June 30.

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 Lombardini.