SAG Rejects Studio Offer; Back to Stalemate

By a vote of 73% to 27%, the Screen Actors Guild board of directors voted Saturday to reject the studios’ most recent offer, which the studio alliance, the AMPTP, had delivered two days earlier. Thus, the offer will not be sent out to the membership for a ratification vote. Nor, however, does the rejection mean that there will be a strike, since the union has not (as yet, at least) sent a strike authorization vote to the membership. There are no further meetings scheduled between the two sides.

What next? No doubt there will be attempts at back-channel talks, but, if so, progress is likely to be slow at best. The studio offer by its terms was to remain on the table for up to 60 days. Now that it’s been formally rejected, however, the studios could presumably impose the proposed deal unilaterally. Or, they could lock actors out. Neither action seems likely though, since either one would tend to unify the SAG membership, and neither approach would give the studios what they want (particularly in the feature realm), which is the absolute assurance that the union won’t strike. That complete assurance comes only when a signed contract is in place.

Thus, the most likely result is continued stalemate. Indeed, in the short term, SAG has other fish to fry: the negotiations over the commercials contract begin Monday. That agreement is SAG’s second most important contract economically. Fresh from today’s boardroom, the union’s leaders must now decamp for New York, where they, along with AFTRA leaders and the two unions’ joint commercials negotiating committee, face off against the Joint Policy Committee (JPC), representing advertisers and ad agencies.

Meanwhile, SAG’s main objection to the AMPTP offer is not new media per se, but the rather more prosaic issue of contract expiration date. SAG wants the contract to expire June 30, 2011, which would put in synch with AFTRA and just a couple months later than the Writers Guild. That synchronicity, with its threat of a possible joint strike, would give the unions negotiating leverage in 2011. They’ll need that leverage to effectively bargain over new media, which will have grown in economic importance by then, perhaps dramatically.

The studios, however, want a three-year deal, which is the usual term for Hollywood labor agreements, and the offer rejected today so reflects. That would put SAG’s expiration in early 2012, or almost a year later than the WGA’s. The stage would be set for a repetition of this year’s labor scenario, in which the SAG deal expired 8 months after the WGA’s did (in fall 2007). Indeed, with a desynchronized expiration date, SAG could find itself playing a weak hand every three years for future negotiating cycles to come. As new media continues to evolve, SAG would find itself entering increasingly difficult negotiations with little leverage.

The studio offer includes an unusual wrinkle: the SAG deal will be allowed to expire on June 30, 2011 (which is the same date the AFTRA agreement expires), but only if SAG and AFTRA jointly bargain and reach a deal before that date. In other words, the two unions would be able to bargain jointly, but SAG would not have a strike threat to back up its negotiating position.

Below are statements released by SAG and the AMPTP.

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STATEMENT FROM SAG NATIONAL BOARD OF DIRECTORS — SAG NATIONAL BOARD REJECTS AMPTP LAST, BEST AND FINAL OFFER

Los Angeles, (February 21, 2009) – The Screen Actors Guild National Board of Directors today voted 73% to 27% to “reject the AMPTPs last, best and final offer dated February 19, 2009.”

We entered this round of negotiations sending an unmistakably clear message that we were ready to make a deal. In an effort to put the town back to work, our negotiator agreed to modify the Guild’s bargaining position to bring the Guild in line with the deals made by our sister unions.

The AMPTPs last-minute, surprise demand for a new term of agreement extending to 2012 is regressive and damaging and clearly signals the employers’ unwillingness to agree to the deal they established with other entertainment unions. The demand for a new term of agreement was not part of their final offer of June 30, 2008; it was not part of the federally mediated talks of November 2008, and should not have been inserted into the discussions when we returned to negotiations on February 17, 2009.

What management presented as a compromise is, in fact, an attempt to separate Screen Actors Guild from other industry unions. By attempting to extend our contract expiration one year beyond the other entertainment unions, the AMPTP intends to deleverage our bargaining position from this point forward.

Screen Actors Guild’s goal is to successfully complete these negotiations and get the industry back to work as soon as possible. The AMPTP has clearly stated their need and desire for financial certainty and industry peace. This new proposal does the exact opposite, and will only result in constant negotiating cycles and continued labor unrest.

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Statement by the AMPTP

The Producers' offer is strong and fair - and has been judged to be strong and fair by all of Hollywood's other major Guilds and Unions. We have kept our offer on the table - and even enhanced it - despite the historically unprecedented economic crisis that has clobbered our nation and our industry.

The Producers have always sought a full three-year deal with SAG, just as we negotiated with all the other Unions and Guilds, and have offered SAG a way to achieve an earlier expiration date without contributing to further labor uncertainty. We simply cannot offer SAG a better deal than the rest of the industry achieved under far better economic conditions than those now confronting our industry.