AFTRA employees sign new pact

Details: my Hollywood Reporter article.

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Watch for my new book “Hollywood on Strike!,” due out next month. Subscribe to my blog (jhandel.com) for more about entertainment law and digital media law. Check out my residuals chart there too. Go to the blog itself to subscribe via RSS or email. Or, follow me on Twitter, friend me on Facebook, or subscribe to my Forbes.com or Huffington Post articles. If you work in tech, check out my book How to Write LOIs and Term Sheets.

Tips Welcome

Now that I'm covering labor for The Hollywood Reporter, I want to say something that might be obvious: I want your tips, thoughts, rumors, etc. Whether it relates to AFTRA, DGA, SAG, WGA or another entertainment union, and whether you're on the management side or labor, I rely on your help. Anonymity is always respected.

In return, my commitment to you is to always be as balanced, fair, informative and detailed as possible. When I make mistakes, I'll correct them, so send me corrections too. Naturally, I'll always be looking be looking to corroborate information before printing it, but that's my job.

On a personal level, thank you. Praise (or polite, constructive criticism) is always welcome. You can reach me at jhandel at att dot net, 323 650 0060, or via the Facebook, Twitter and LinkedIn addresses below.

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Watch for my new book “Hollywood on Strike!,” due out next month. Subscribe to my blog (jhandel.com) for more about entertainment law and digital media law. Check out my residuals chart there too. Go to the blog itself to subscribe via RSS or email. Or, follow me on Twitter, friend me on Facebook, or subscribe to my Forbes.com or Huffington Post articles. If you work in tech, check out my book How to Write LOIs and Term Sheets.

JLH to Cover Labor for THR

I'm delighted to announce that I'll be covering labor on a regular basis for The Hollywood Reporter - here's the official announcement. I also continue to practice law as of counsel at TroyGould. I've been there fourteen years and the firm just celebrated its fortieth anniversary!

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Watch for my new book “Hollywood on Strike!,” due out next month. Subscribe to my blog (jhandel.com) for more about entertainment law and digital media law. Check out my residuals chart there too. Go to the blog itself to subscribe via RSS or email. Or, follow me on Twitter, friend me on Facebook, or subscribe to my Forbes.com or Huffington Post articles. If you work in tech, check out my book How to Write LOIs and Term Sheets.

SAG, AFTRA start talks with studios

For details, see my Hollywood Reporter piece.

Basic Cable Clarification & Details

In yesterday’s post regarding the schedule for this cycle’s negotiations, I said that SAG and AFTRA would be jointly negotiating basic cable starting on November 7. Sources close to AFTRA and SAG have corrected me on this—and provided more details.

My take on this was based on a misreading of a SAG press release from 11 days ago. The actual language in the release was:

The Basic Cable Live Action, Basic Cable Animation and TV Animation contracts negotiations with producers are tentatively scheduled to begin November 7, 2010. As part of the Basic Cable Live Action agenda item, the SAG National Board voted to explore the possibility of coordinated bargaining with AFTRA in the area of live action basic cable programming.

The source close to SAG confirms that SAG has indeed reserved time starting on Nov. 7 for basic cable discussions. So SAG will presumably be having basic cable discussions with the companies unless something unexpected happens. The AMPTP will be present, and the sessions will be at AMPTP headquarters, but the discussions are technically with “authorizers,” which appears to mean some of the AMPTP members plus other companies.

Will AFTRA be a part of those negotiations? That’s where it gets more complicated. Sources close to both unions confirmed that there have been emails and conversations between the two unions, with one source implying that these informal communications have been between the National Executive Directors of the two organizations, David White (SAG) and Kim Roberts Hedgepeth (AFTRA).

Have those communications progressed beyond the informal stage? The source close to AFTRA says they haven’t, and that s/he would expect a formal letter if things were to continue to move forward. The source close to SAG was a bit doubtful that such a letter was even necessary, but wasn’t completely sure.

Regardless of formality, is AFTRA receptive to the idea of coordinated bargaining? The source close to AFTRA said yes, in theory. The caveat was that AFTRA would want to be sure that coordinated bargaining would increase the likelihood of members actually working. S/he added that AFTRA would consider any SAG proposal on coordinated bargaining very seriously.

That comment points out a difference in philosophy between the two unions, at least to date. SAG has a single basic cable agreement. Companies are offered they agreement, and that’s what they have to sign if they want to use SAG members in their productions. Only in rare circumstances are waivers granted.

AFTRA in contrast has four basic cable templates, one of which is similar to the SAG basic cable contract. Two of the contracts are used with smaller networks, such as the CW, while other are used with full-fledged networks. In each situation, there is a choice of two approaches to residuals. Additionally, the templates are subject to negotiation, which is why they’re “templates” (or “contract forms”) rather than “contracts.” The result is so-called “one production only” deals.

The difference in philosophy is this: AFTRA believes that these OPO deals are the best opportunity to prevent shows from going non-union or being produced in Canada. The source close to AFTRA says the union has statistics on this. There were some statistics of this sort in AFTRA’s 2007 magazine article on basic cable. I’m not sure if there are more recent figures as well.

SAG, in contrast, believes that promulgating a single contract is the best way to ensure that guild members receive the full benefit of SAG’s power to negotiate on their behalf, and that a union’s job is to set minimums.

There’s a also a perception, among at least some leaders on the SAG side, that AFTRA does not pursue contract grievances as aggressively as SAG does. Producers and management-side lawyers generally share this belief, and often prefer to deal with AFTRA rather than SAG.

It doesn’t go unnoticed, either, that AFTRA’s approach has enabled the union to achieve greater market share in basic cable. Whether this comes at the expense of SAG, as some believe, or is simply captures programs that would have gone non-union or fled to Canada, is difficult to say.

In any case, the fundamental difference in opinion is clear, and the question is, should a union focus more on obtaining work for members or more on setting minimums? Compromises between these two extremes are obviously possible, but the two goals are obviously in tension with each other.

The importance of coordinated negotiations, and achieving a synchronization of the two unions’ approach to basic cable is that this helps advance the cause of merger. A single, merged union obviously can’t have only one contract and never deviate from it, while simultaneously having four templates and negotiating OPO deals.

The most likely solution is to meet in the middle, and, for instance, have two contracts rather than one or four. Or there might be four contracts but now deviations from them (i.e., no OPO deals, just a choice of contracts). And, perhaps, two of those contracts might b phased out over the next several years. There are all sorts of compromises one might envision, but it’s obvious why the matter is sensitive.

Another reason the matter is sensitive, of course, is that SAG is in the position of asking AFTRA whether it will join SAG and bargain in a coordinated way. This conceptually makes SAG the suitor, and AFTRA the decision maker (or the “decider,” in George Bush’s charming locution). That’s not a comfortable place for SAG to be in and will require delicate maneuvering to avoid bruised egos. Indeed, it’s perhaps a bit surprising that SAG’s board voted to explore coordinated bargaining without assurance that AFTRA’s board would adopt a similar resolution at its board meeting, which was held on the same day as SAG’s.

SAG, AFTRA and the AMPTP had no comment.

Stay tuned for my piece later this week looking at the issues in play for SAG and AFTRA. And watch for my new book “Hollywood on Strike!,” due out next month.

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Subscribe to my blog (jhandel.com) for more about entertainment law and digital media law. Check out my residuals chart there too. Go to the blog itself to subscribe via RSS or email. Or, follow me on Twitter, friend me on Facebook, or subscribe to my Forbes.com or Huffington Post articles. If you work in tech, check out my book How to Write LOIs and Term Sheets.

Hollywood Labor: The Tyranny of Time

One key to understanding Hollywood labor is a tool that was invented thousands of years ago: the calendar. That much became clear in the last round of major negotiations, which lasted from 2007 to 2009, and featured a writers strike and a SAG stalemate. I covered those events as they occurred, and they’re also the topic of my forthcoming book, “Hollywood on Strike!,” which is due out next month.

So with the SAG-AFTRA negotiations upon us, let’s look at what the 2010-2011 bargaining cycle has in store.

SAG and AFTRA

The SAG and AFTRA negotiations with the AMPTP (studio alliance) begin on Monday the 27^th, less than a week away. They’ll focus on the SAG Codified basic Agreement (which covers film and television), SAG Television Agreement (a supplement which adds more detail regarding television), and AFTRA’s Exhibit A (which covers primetime scripted television). Exhibit A is largely, though not entirely, composed of cross-references to provisions in the SAG agreements.

These negotiations are under the framework of the Phase I agreement, which has governed SAG-AFTRA joint negotiations with the studios for the last 29 years, with the notable exception of the last negotiating cycle.

On November 7, basic cable negotiations may occur. See http://digitalmedialaw.blogspot.com/2010/09/basic-cable-clarification-details.html for details.

The November 7 date seems to assume that SAG, AFTRA and the AMPTP will reach agreement prior to then. This is expected, but is not a given. The SAG and AFTRA contracts don’t expire until June 30 next year, but the studios insisted on early negotiations in order to reduce the likelihood of brinksmanship, stalemate or strike. This was particularly important to them in light of the nearly year-long SAG stalemate during the last negotiating cycle.

However, timely completion of the contracts seems likely this time because of a seemingly unrelated issue: merger of SAG and AFTRA. The actors—SAG’s leadership in particular—want to spend 2011 working towards merger of the two unions.

That ties the negotiating schedule into the SAG election schedule. SAG president Ken Howard will be up for reelection in the 2011 summer-fall election cycle. In order to best position himself for reelection, it’s important that he and his Unite for Strength faction to show progress on merger prior to the time campaigning begins, which is typically in June or July.

That imperative, in turn, means completing the AMPTP negotiations in November, so that there’s sufficient time to work on merger. The “urge to merge” also has some implications on negotiating issues themselves, as I’ll discuss in a future article.

Of course, one side’s imperative is the other side’s leverage. The AMPTP knows that it’s important for the actors to get their deal done by November, and will be able to hold the unions up against the wall of that deadline if need be. The AMPTP now doubt opposes merger—why would management want to deal with a more unified bargaining representative—and that means they will seek to extract concessions if they’re going to agree to deal points that make merger easier.

DGA

Moving on: In mid-November, the DGA will begin formal negotiation of their film and television agreements, which also expire June 30. Those agreements include basic cable, so there isn’t a separate agreement for that medium as there is for SAG and AFTRA.

The creative rights aspects of the DGA agreements will be negotiated at the same time, but directly with the studio CEOs. This may be the only place in Hollywood labor where negotiation is explicitly reserved to the CEOs, rather than the AMPTP—whose entire purpose is, after all, to negotiate labor agreements.

This extraordinary arrangement reflects both the power of the DGA and the key importance to the guild of maintaining the creative control enjoyed by directors. Or film and TV movie directors, at least. Television series directors march to the tune set by the writer-producer, i.e., the showrunner.

Although the DGA’s formal negotiation don’t start until mid-November, the guild has said they will start informal negotiations prior to then. They may well have done so already. This timing here allows the AMPTP to use the DGA as a shield against SAG-AFTRA contract proposals that the studios consider excessive.

For instance, if the DGA and AMPTP informally agree in September or October that wage increases will be a particular percentage, then if SAG and AFTRA insist on a higher percentage, the AMPTP can demur, confident in the knowledge that they can do a deal with the DGA that will set the pattern on the issue.

Likewise, if the DGA decides that certain new media issues are not important, SAG and AFTRA will have an uphill fight to extract concessions from the AMPTP on those particular issues. Indeed, the DGA has already said publicly that new media will not be a focus of their discussions. So, SAG and AFTRA are already in a difficult place on those issues.

The DGA’s policy of informal pre-negotiations also means that few formal sessions are necessary to reach a deal. Last negotiating cycle, for example, the DGA and AMPTP held just five days of formal bargaining. That’s why this year’s mid-November start date probably means a deal will be reached before Thanksgiving, which falls on November 25^th. That allows for roughly 7 weekdays and one weekend of formal sessions.

WGA

And what of the Writers Guild? Those negotiations have not yet been scheduled. They won’t start until mid-January at the earliest, since little business can get done in this industry between Thanksgiving and New Year’s.

That timeframe is a problem, because the WGA usually takes far more than 5 days to reach agreement with the AMPTP. Moreover, their agreement expires two months earlier than the actors’ and directors’, on May 1. That’s a 3-1/2 month window to conduct negotiations.

Such a short window may encourage studios to begin stockpiling feature film scripts later this year, if they haven’t already. That’s because it typically takes two or more months to write and revise such scripts. The studios don’t want to be left with nothing to shoot during the summer, for fear of not having a steady supply of product. Also, early summer is particularly important time for shooting movies that use network television actors, since that’s when they’re on hiatus and thus available for film work.

Television stockpiling, in contrast, probably wouldn’t start until sometime in the spring, as May 1 first approaches.

Writers are aware that this year they’re the caboose and thus are left with little leverage. This may encourage their guild to bargain down to the wire in an attempt to exercise what little power they do have. Thus, the WGA negotiations may turn into a game of chicken, since such brinksmanship is unlikely to translate into a strike authorization, let alone an actual strike, so soon after the devastating 2007-2008 strike.

A middle ground is also possible, which is that the WGA works without a contract for weeks or even months. The dynamics are hard to predict: strike architect David Young is still the union‘s executive director, but the president is now the more moderate John Wells.

Summing Up

In any case, one thing is clear: if SAG and AFTRA are unable to reach a deal by November, the picture looks very different. In this scenario, the DGA will do its deal in November, and then SAG, AFTRA and the WGA will be in play in the spring. This would impede the actors unions’ progress towards merger, but would give SAG, the WGA and AFTRA the ability to threaten a joint strike. Thus, merger and strike threats are at poised against each other quite starkly as contrasting strategies in this negotiating cycle.

Later this week: A look at the issues in play for SAG and AFTRA.

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Subscribe to my blog (jhandel.com) for more about entertainment law and digital media law. Check out my residuals chart there too. Go to the blog itself to subscribe via RSS or email. Or, follow me on Twitter, friend me on Facebook, or subscribe to my Forbes.com or Huffington Post articles. If you work in tech, check out my book How to Write LOIs and Term Sheets.

The Anti-SAG Lawsuit That Won't Quite Die

Remember the lawsuit filed by then-SAG president Alan Rosenberg, 1st VP Anne-Marie-Johnson and board members Diane Ladd and Kent McCord against their own Guild? That's the suit that got dismissed for the umpteenth time last month.

Turns out that there's some unfinished business. SAG's lawyers filed a motion for court costs, in the amount of $834.44. If the figure sounds low, remember that that's just filing fees and the like; it's basically impossible to obtain an award of attorney's fees.

Well, it turns out that Rosenberg et al have now filed a counter-motion to strike some or all of those costs. Thus, on October 12, there will be yet another hearing, requiring once again the presence of SAG's outside lawyers, who are presumably being paid by the hour.

So, rather than Rosenberg and the three other plaintiffs paying about $200 each in court costs as a result of their long-lived misbegotten battle, they'd rather first see if they can force the guild to expend just a little bit more members' dues on this nonsense. Not the sort of scorched earth tactics one would hope for.

SAG Feels its Own Labor Pains

Labor unrest is hitting SAG close to home.

Negotiations between the actors guild and Teamsters Local 986, which represents more than 40 of SAG's Los Angeles-based business representatives, have gotten bumpy. The contract between the parties expired June 1, and one issue still to be resolved is what wage increases the new deal will grant.

Yes, even unions have unions. In this negotiation, SAG functions as management, not labor. After about a dozen meetings, the two sides are far apart, with the key sticking issues being wages and a SAG proposal to require the employees to arbitrate discrimination and sexual harassment claims rather than file them in court.

For more details, see my piece in The Hollywood Reporter: http://www.hollywoodreporter.com/hr/content_display/news/e3i7ac2488e5367c3860b8b6e94dda149c5.

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Subscribe to my blog (jhandel.com) for more about entertainment law and digital media law. Check out my residuals chart there too. Go to the blog itself to subscribe via RSS or email. Or, follow me on Twitter, friend me on Facebook, or subscribe to my Forbes.com or Huffington Post articles. If you work in tech, check out my book How to Write LOIs and Term Sheets.

Ratification of Teamsters / Basic Crafts Contract Complete

The Teamsters ratified their contract several weeks ago. However, four other basic crafts (plumbers, plasterers, electricians and laborers) negotiate alongside the Teamsters. Ratification by those unions was expected and, indeed, the AMPTP said today that the last of those just ratified their contract. Here's the organization's press statement:

"The five Basic Crafts Unions have now ratified new contracts with the producers represented by the AMPTP, ensuring that production can continue without interruption for the studios and union members.  The two sides reached a fair deal with gains in wages, benefits and other terms for the unions while recognizing the current economic realities of the industry.  This would not have been possible without hard work and commitment of the leadership of each of the Basic Crafts Unions, whose negotiating committee was chaired by Local 399 Secretary-Treasurer Leo T. Reed.  The five Basic Crafts Unions are International Brotherhood of Electrical Workers, Local No. 40,  Plumbers, Local No. 78, Teamsters, Local No. 399, Studio Utility Employees, Local No. 724, and Operative Plasterers and Cement Masons, Local No. 755."

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Subscribe to my blog (jhandel.com) for more about entertainment law and digital media law. Go to the blog itself to subscribe via RSS or email. Or, follow me on Twitter, friend me on Facebook, or subscribe to my Huffington Post articles. If you work in tech, check out my book How to Write LOIs and Term Sheets.

Rosenberg v. SAG Lawsuit Dismissed

The lawsuit filed 1-1/2 years ago by SAG's then-president Alan Rosenberg against his own union has finally been formally dismissed, according to court records and a source with knowledge of the matter. The formal dismissal actually came in late July, but appears not to have previously been reported. The dismissal was expected, as the judge had ruled on the matter a month earlier.

The action ends with a whimper a suit that attempted to reinstate SAG's previous National Executive Director, Doug Allen, and impede the ultimate achievement of the 2009 agreement between SAG and the studios and producers.

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Subscribe to my blog (jhandel.com) for more about entertainment law and digital media law. Check out my residuals chart there too. Go to the blog itself to subscribe via RSS or email. Or, follow me on Twitter, friend me on Facebook, or subscribe to my Forbes.com or Huffington Post articles. If you work in tech, check out my book How to Write LOIs and Term Sheets.