After Its Fight With Agencies, WGA Will Have to Face Other Battlegrounds

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Cheyne Gateley/Variety

The Writers Guild of America has aggressively marshaled its forces in the fight to reform the rules of engagement for talent agents who represent its 15,000 members. But as that battle rages, the guild faces some practical decisions on whether it can handle waging war on two fronts as it prepares for what are expected to be tough master film and TV contract negotiations with the major studios next year.

First and foremost, the WGA has to make sure that the still-unresolved agency feud doesn’t overly tax the resources it will need if it has to prepare for a labor action in the 2020 master contract negotiations. The most crucial component of that fight will be the support of membership, particularly among prominent showrunners and screenwriters. The WGA can’t afford to alienate its working members if the agency conflict devolves into mass firings of agents by writers in the near term. Such a break with industry tradition would inevitably affect the orderly course of business at a time when the business itself is in the throes of transformation.

WGA West executive director David Young told Variety that the shifting landscape in the television-series arena has led to financial hardships for writers, even in this moment of peak TV. The issues that have flared in the ATA fight — concern about falling incomes for lower- and mid-level writers — will surely be a focus for the guild in the next round of studio negotiations, although Young stressed that it was too soon to cite specifics on the WGA’s 2020 negotiating agenda.

“My biggest concern as a union is to defend our members’ income. Part of that is solving the way agencies handle the over-scale negotiation for our members,” Young said, referring to writer salaries that are beyond the minimums set in the WGA’s Minimum Basic Agreement with the majors. “These shorter episode orders have become a tremendous financial success for the business, but they’re not a tremendous financial success for my members. They’re a problem for my members.”

Representatives of the Assn. of Talent Agents declined to comment.

The WGA and ATA appeared to be careening toward a bitter breakup on April 6, when the guild’s existing agency franchise agreement expired. But an eleventh-hour overture from UTA co-president Jay Sures to WGA West president David Goodman — via an Instagram direct message — led the sides to meet that day for the first time in more than a week as the clock ticked down to the midnight PT deadline the WGA had set for the implementation of its Agency Code of Conduct. Another session was held April 8, with no immediate word of progress between the two sides. The guild has vowed to establish the code if it cannot strike a deal with the ATA on a new franchise agreement. The WGA has the authority to govern relations between agents and the guild’s members in its capacity as a labor union. The ATA has said the Code of Conduct as it stands now is a nonstarter for its member agencies.

At the end of this past weekend’s four-hour meeting, the WGA’s agency contract negotiating committee voted unanimously to extend the deadline for enforcing the code to Friday, April 12, in order to give the sides more time to wrangle over a new deal. Meanwhile, sources say there are burgeoning efforts among writers and what one agent called “concerned citizens” — notably lawyers and others who would be affected by a WGA-ATA blowup — to help generate creative solutions that could become the framework for a deal.

The guild aims to bar the long-standing industry practice of talent agencies collecting packaging fees from TV shows and movies, arguing that it is an inherent conflict of interest to be paid by production entities rather than on a client-commission basis. The WGA’s reform effort also aims to curb the expansion of the parent companies of the largest agencies into the finance, production and distribution arenas. That’s another conflict-of-interest concern that has raised eyebrows throughout the industry as the owner firms of CAA and WME have diversified aggressively in recent years into new areas of business.

On March 29, the WGA blasted Endeavor, the parent of WME, over a report that it’s planning an initial public offering, saying, “Today’s announcement that Endeavor plans to become a publicly traded company only strengthens the call for the conflicted and illegal practices of the major talent agencies to end. It is impossible to reconcile the fundamental purpose of an agency — to serve the best interests of its clients — with the business of maximizing returns for Wall Street.”

The WGA and ATA have been publicly and privately sparring since negotiations began in earnest in February. The guild’s agency franchise agreement had been untouched since 1976.

Sources on both sides of the table said there was enough positive momentum that came out of the April 6 meeting to offer hope that a compromise can be reached to avert a sudden divorce of writers and agents. But the gulf of opinion on the key obstacles — packaging and production — between the agency and WGA negotiators remains wide. Moreover, the guild has cast the issue of agencies taking packaging fees paid by production entities as “illegal” and “immoral.” That good-versus-evil framing will make it challenging for the WGA to accept anything less than a full ban on the practice — one that stretches back to the days of radio.

The threat of litigation remains strong. Young confirmed that the guild has a draft of a lawsuit against ATA and its members if the sides can’t reach a deal and the code is implemented.

“There are practices involved in this [ATA] negotiation that are complete violations of state and federal law,” Young said. In the absence of an agreement with agencies, “we would pursue those claims.”

In the days leading up to the April 6 deadline, the WGA began to feel more pressure from some prominent members urging them to “fix this” situation with the ATA, in the words of one showrunner who sent an email message to WGA West president Goodman. That sentiment surely weighed on the negotiating committee after the ATA side extended the olive branch of requesting the April 6 meeting.

The standoff with the ATA is a pointed reminder of the WGA’s willingness to exert its muscle in Hollywood under the leadership of Young, who organized the 2007-08 writers’ strike against studios that rocked Hollywood. The 100-day walkout began after negotiations cratered on a variety of divisive issues, such as how writers would be compensated for content in what was then the nascent world of online distribution.

Young was widely credited for running a well-organized strike featuring extensive picketing and rallies that benefited from strong support by the Screen Actors Guild and the Teamsters. The work stoppage forced a halt to most TV series in the middle of a season.

In 2017, Young led the negotiations for the successor deal to the master contract — with an agreement hammered out an hour before the contract expired. The WGA touted gains in short-order series compensation, family leave and shoring up the health plan. That came a week after a strike authorization that was supported by 96% of those voting — similar to the recent level of support that the WGA leaders received in late March for their position on the Code of Conduct.

The WGA’s current master contract will expire on May 1, 2020. The SAG-AFTRA and Directors Guild of America deals expire on June 30, 2020. The Alliance of Motion Picture and Television Producers, which serves as the negotiating arm for the studios, usually negotiates first with the DGA, which prefers to wrap up its deals at least six months prior to expiration in the belief that the promise of stability enables the DGA to achieve the best possible terms.

That’s diametrically opposed to the WGA strategy, which is to negotiate with the imminent threat of a strike — or in the current case, a wholesale firing of agents.

Whatever the resolution of the ATA-WGA battle, it will have a profound impact on the ongoing fight over who gets paid how much in Hollywood.