Deadline AMPTP

Below is a composite Q&A that’s the truth your Hollywood Guild leaders are saying in private and not telling you to your faces at a time when nearly all writers, actors, and directors are hanging by their fingernails to maintain their livelihoods under the studio and network rollbacks. Today the WGA membership voted to ratify their new TV/Theatrical Contract reached last month with the AMPTP. I was shocked and appalled by the lack of public dissemination of info by the Guild to its members during the process. But this kind of secrecy has marked all of the Hollywood Guilds dealings with its memberships on these contract negotiations and ratification votes. That’s to cover up the fact that neither SAG nor the DGA nor the WGA bothered to bargain hard for pay increases or barely at all for New Media increases despite promises to that effect during the last contract go-rounds.

I emailed and spoke at length with several members of the WGA negotiating team and board of directors to be able to collect the following behind-the-scenes information (see composite Q&A below). What I learned goes way beyond the ratification ballot statement from negotiating committee co-chairs John Bowman and Billy Ray explaining why the talks had been completed in little more than two weeks blaming “an economy still recovering from a deep recession; an economic pattern set in negotiations with other unions; and the willingness of the Companies to address the Guild’s most pressing economic need, regarding the solvency of the pension plan.” Or the cover letter from WGA West president John Wells and WGA East president Michael Winship that said, “We highly endorse ratification of this contract” and noted the unanimous recommendation of the negotiating committee, WGA West Board and WGA East Council.

Really? REALLY? Then why did one of the above WGA leaders email me to agree when I crapped all over this lousiest of lousy WGA deals with the AMPTP when it was announced a month ago: “Off the record, your analysis of this deal is spot on.” 

Who else agreed with me? Stephen Diamond, the Santa Clara University Law professor and one-time candidate for SAG’s executive director, who called the deal a “clean sweep for big Hollywood studios as WGA negotiations end” and “the final domino in this year’s Hollywood collective bargaining round”.

My analysis included calling this the worst deal writers had ever been handed. Saying the Writers Guild leadership clearly decided it had no leverage after the Actors and Directors Guilds threw them under the bus by accepting bad contracts and even the WGA membership gave them no hand by overwhelmingly (and understandably) opposing any mention of a strike. Noting that the Big Media companies finding their financial footing again after the depths of the economic crisis. Stressing that New Media increases have gone the way of the VCR and the DVD: what was negotiated first is what you’re stuck with now and seemingly forever if the AMPTP continues to have its way. Laughing at the flimsy new meetings on sweepstakes pitching and one-step deals, and “contract provisions [which] have been added that require each studio to send to its creative executives a bulletin stating clearly that spec writing is not to be condoned” as if this will stop these hated but institutionalized practices. It’s such a WGA betrayal after guild leadership and Hollywood agencies pledged to work together to stop the studios’ blatant exploitation of movie scribes.

I had long predicted Hollywood could most likely expect quick and easy negotiations this time around. So let’s see… SAG/AFTRA spent just 6 weeks of jointly negotiating with the studios and networks on a new 3-year TV/Theatrical contract. The DGA took just 3 weeks and change. And the WGA could have bargained right up until its May 1st when its current contract ends but didn’t. The moguls behind the AMPTP always intended to negotiate with the writers last (even though their pact was expiring sooner) to ensure there would be the most Hollywood pressure (synonymous with antagonism) towards them if they negotiated too hard. Although SAG/AFTRA and the DGA traded information during their talks, they left the WGA out in the cold.

The whole point of this lead-in to contract negotiations for for all the Hollywood Guilds to better coordinate bargaining in order to present a united front to the AMPTP. Promises were made to “next time” secure better wages, benefits, working conditions. Even the AMPTP pledged it would reopen bargaining over those paltry New Media revenues. True, no one wanted another strike. But was the only alternative for the WGA to wimp out like the other Guilds? So now all the Hollywood Guilds rubber-stamped what crumbs the AMPTP offered despite this rapidly improving economy. The DGA was first to make it plain early on that they weren’t going for big wages (just a 2% increase) or even a better New Media deal. Instead the DGA negotiators were focusing on increased Health Plan and Pension contributions. Same with SAG/AFTRA. The WGA also focused on the pension plan. But all the writers I know in the guild who aren’t yet or once were big names are most concerned about losing their health insurance. Nothing for them.

I’d been pressing the Writers Guild with questions to respond to my analysis that WGA negotiators caved to the studios and networks. I’ve now collected their off-the-record answers (with the proviso that the responders not be identified) and put it into a Q&A format. If you read this and realize how much you and your fellow Hollywood Guild members got played, then hasn’t the time come to throw out all the current bums and install new union leadership?

Here’s the composite Q&A:
DEADLINE: I’m shocked at how bad this deal is. Can you give me insight into what happened?
WGA NEGOTIATIONS INSIDERS: You have it right in your post. The companies singled out the weakest of the Guilds — SAG/AFTRA — to negotiate with first – and for whatever reason, the actors Guilds went along with it. The actors’ health and pension funds were (and are) in dire shape, with significant possible unfunded legal and accounting liabilities for the companies. So the companies put a lot of money on the table to try and shore some of this up (and limit their own liability). The AMPTP then refused to make any movement on anything else of consequence – and the actors accepted the deal. We’ve all know that the actor guilds were in “cave to merge” mode, and that’s exactly what happened. The AMPTP is smart: they forced them to sign an early negotiation clause 18 months ago to close out their last contract and then jammed them.

We don’t want to be too critical here of the actor unions, they’re in very bad shape, SAG in particular. SAG has to merge or they will cease to exist – and soon. They’re certainly in grave danger of no longer being able to provide even the most basic health benefits for all but the most successful of their members. They’ve been raising eligibility and co-pay requirements at a shocking rate that makes it difficult for many of their members to even qualify. Thousands of actors who used to routinely qualify for health benefits that allowed them to pursue the craft can no longer provide security for their families. And both actors unions were very close to being unable to meet their pension obligations and entering the “red” zone. The zone system for evaluating pension plans was enacted during the Bush administration as part of the PPA (Pension Protection Act.) Entering the red zone would have been catastrophic for all actors – and would have allowed the companies to enact draconian measures that could have significantly reduced pensions for actors long retired and dependent on these earned benefits. All that said, they made a crappy deal on everything other than pensions and health and left the other two creative guilds hanging out to dry.

Then came the DGA. Coming in early as they have so often done (jumping in front of our earlier contract date again). They also have problems in their health plan. They took an equivalent amount to the money SAG/AFTRA had gotten, and put it in their health plan. Made some very minor steps in basic cable that we think are counterproductive for writers (increases on very high budget minimums – that only one or two shows will hit, if ever). And called it a day.

Then, and only then, was the AMPTP prepared to have even preliminary conversations with us. Candidly, we were concerned (the leadership and staff) that they were planning to push us into a “take it or leave it” pattern offer right up against our contract expiration date. We felt we could maneuver them into giving us a bit more than the pattern if we could force them into an earlier deadline. We were worried they were going to jam us with rollbacks at the last minute, and if they did, we’d have no time to go back to our members and properly organize to get enough of head of steam going to push the rollbacks off the table.

This was all predicated on what you intimated in your post – our members were not in the mood for a strike unless the companies put significant rollbacks on the table. How did we know this? We asked them. Extensive polling, set visits to TV writer’s rooms and we held membership meetings. The response was overwhelming – “we’re only just beginning to recover financially from the strike and the massive recession” “please, please, please, don’t strike…” So we wanted to go in and see if the companies would be foolish enough to put large rollbacks on the table that we could use to galvanize the membership. They didn’t. Lots of petty crap that we had to get rid of, but nothing to convince the membership to take another strike vote only 3 years after the last.

On top of all of this, our pension fund was (is) in trouble. The stock market hit of 2007-2008 shaved hundreds of millions of dollars off our plan. While not in the same shape as the actors’ funds or the DGA health plan, we were in danger of moving from the good “green” status into the “yellow” danger status – and then into “red” status sometime in 2014 to 2015. The PPA danger to future and present retirees was and is real. The AMPTP knew this because half of the trustees are management trustees and have the same actuarial info we do. We knew we needed the money (1.5% increases in contributions) that the other guilds had gotten to shore up our pension fund, but wanted to try and get something else to go with it. The companies are a little frightened of us – and we tried to jam them to get the pension money we needed and some more in basic and pay. We got a little bit, but not much. And that’s why you didn’t read any self-congratulatory crap in our letter to the membership like you saw from the other Guilds. We did what we could under difficult circumstances. We’re disappointed we couldn’t do more. Relieved we’ve shored up the pension plan and protected our retirees and future retirees.

DEADLINE: What was your biggest obstacle to getting a better deal than this one?
WGA NEGOTIATIONS INSIDERS: We had no credible strike threat, not even vaguely; and we had no effective alliance with either SAG/AFTRA or the DGA. Hence: no leverage. Regardless of contract expiration dates, the AMPTP negotiates first where it can get the best deal, then tries to impose the pattern on everyone else. In the absence of leverage, there’s little that can be done once the first deal is set.

DEADLINE: Is there any good news from what you did get?
WGA NEGOTIATIONS INSIDERS: This deal will cost out to approximately $60M across the life of the contract, as opposed to $40M or thereabouts in the previous negotiations. Read More »