WGA & Producers Agree To Resume Contract Talks April 10 – Update

UPDATED, 6:45 PM: The WGA has confirmed that contract talks with the Alliance of Motion Picture and Television Producers will resume a week from Monday. “The WGA has agreed with the AMPTP to recommence negotiations on Monday, April 10th, at 10:00 AM,” the union said in a statement. “The Guilds will not be commenting at this time.”

PREVIOUSLY, 4:40: The WGA has responded to the AMPTP’s invitation Thursday to resume negotiations for a new film and TV contract, suggesting Monday, April 10, as the start date and Friday, April 14, as the last day of bargaining, unless the companies respond earlier with a revised set of proposals that address the guilds’ “core issues.”

“Wednesday, March 23rd, the WGA made further cuts to its initial list of demands, reducing the economic cost of the package by almost 50%,” WGA West executive director David Young said in an email today to AMPTP president Carol Lombardini. “Late Thursday, the companies presented a comprehensive package proposal that failed to address our essential economic issues. We made clear that evening that the guild rejected your proposal.

“We are ready to return to the bargaining table to hear a revised proposal from the AMPTP that addresses the guild’s core issues. Alternatively, in the absence of such a constructive proposal from you, we are prepared to respond with a package that addresses the inadequacies of your last offer.

“I suggest that the parties meet from April 10th-April 14th and seek to finalize a new agreement. I look forward to hearing from you.”

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The talks broke off a week ago and the guilds’ are now in the process of asking their members for strike authorization.

The guilds’ core issues – the ones that could set off their first strike in nearly 10 years – are more money for film and TV writers and a bailout of the WGA’s failing health plan.

In the end, strike or no strike, the WGA probably will be getting a deal very similar to the one the DGA got, which included a tripling of residuals for high-budget SVOD. The big difference is that the WGA’s health plan is going broke. Currently, employers pay only 9.5% of covered earnings into the plan, while the companies are paying 10.5% into the DGA plan. But over the years, the DGA had to make concessions to get that 10.5%.

Because covered WGA earnings total more than $1.1 billion a year, a 1 percentage point increase in employer contributions would pump another $10 million into the health plan. The companies have agreed to cover 80% of the WGA health plan’s deficits through 2020 – which are expected to top $50 million – but want the WGA to pony up some money too. According to the guild: “They have demanded that we make cuts to the plan — $10 million in the first year alone. In return, they will allow us to fund the plan with money diverted from our own salaries.”

One way to raise $10 million for the plan over the last two years of the contract would be for the WGA to accept a slightly lower pay raise than the DGA got, which was 2.5% in the first year and 3% in each of the second and third years. If the WGA took 2.5% in each of the three years and diverted 0.5% to the health plan in each of the second and third years, that would reduce the projected deficit by $5 million in each of the last two years of the contract.

That would still give the WGA a nearly $100 million pay raise over three years — about half of the $200 million SAG-AFTRA got in wage gains in 2014 — and SAG-AFTRA has 10 times more members than the WGA.