Actors’ unions and studios agree to new contract

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Hollywood’s actors’ unions and the major studios reached an early agreement on a new film and TV contract, capping nearly six weeks of talks aimed at averting a protracted labor dispute.

As expected, the deal announced Sunday morning between the Screen Actors Guild, the American Federation of Television and Radio Artists and the Alliance of Motion Picture & Television Producers provided some modest pay raises and a significant increase in contributions to the unions’ health and pension plans - a top priority for the unions.

The tentative three-year contract takes effect July 1, 2011, and must still be approved by the joint board of the two unions and a majority of members of both unions before it is ratified. SAG represents 125,000 members, while AFTRA has 70,000 members.

‘The deal offers increases in benefit contributions, wages and other areas critical to working performers while being responsive to the current challenges facing feature film and television producers,’’ the alliance said in a statement. ‘The early agreements also ensure that production can continue without disruption for everyone who depends on this industry.”

SAG and AFTRA began negotiations on Sept. 27, nearly nine months before the current contract expires.

Both sides had agreed to early negotiations in order to avoid a repeat of what happened two years ago, when SAG and the studios were locked in a standoff that disrupted production and caused actors to work without a contract for about a year.

Also boding for an early deal was new leadership at SAG, which is now controlled by a coalition of so-called moderates, won control the national board two years ago, fired former executive director Doug Allen and installed former general counsel David White in his place. White took a less confrontational approach in his dealings with the studios and adopted a low-key approach to the negotiations, avoiding public pronouncements about the unions’ demands.

White and his counterpart at AFTRA, Kim Roberts Hedgpeth, served as chief negotiators. The unions previously broke ranks but have resumed joint bargaining and have had discussions about merging, a top goal of SAG President Ken Howard and his supporters.

‘Strengthening the pension and health plans was our top priority in these negotiations -- making such a significant gain in that area was a vital achievement,’’ Howard said in a statement.

‘I am extremely pleased we met our goal of increasing contributions to our retirement and pension plans, and that we successfully completed this negotiation now to protect the needs of performers early in the process,’’ AFTRA National President Roberta Reardon said. ‘Our joint negotiating committee worked together seamlessly and in solidarity, and I am very proud of their work.”

Both unions faced pressure to get a deal done before the Directors Guild of America started its negotiations. The DGA, which often is the first out of the gate on new contracts, has stated it intends to begin negotiations this month.

Under the agreement, actors would receive 2% annual pay raises, similar to what the Teamsters secured in their recent contract negotiations. The unions sought higher increases, citing how actors are struggling to get their ‘quotes’ and see less income from TV residuals -- the fees they get from reruns -- because fewer shows repeat on the networks or are later sold into syndication.

The studios also agreed to a 10% increase in the current rate of employer contributions to the unions’ health and pension plans, bringing the total contribution rate to 16.5%, representing the largest percentage increase in the plans in more than two decades.

The plans have been hard hit by investment losses and rising medical costs.

SAG’s health plan is facing a $30-million deficit this year and recently notified members that it would be raising premiums and cutting benefits.

The unions, however, did not succeed in persuading studios to secure improved pay and work conditions for actors who perform on a motion-capture stage, a concern fueled by the huge success of James Cameron’s blockbuster, ‘Avatar.’

-- Richard Verrier