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Screen Actors Guild Response to the AMPTP’s Statement July 28, 2008

Screen Actors Guild Response to the AMPTP’s Statement July 28, 2008

The AMPTP is wrong. Their attempts to rebut our statements are intended to obscure the facts. Here are just a few examples:

Regarding jurisdiction:

We have jurisdiction under the current contract. The AMPTP Producers are contractually obligated to give SAG 60 days notice of their intention to produce a program made for the Internet. After notice is given, the producer may either produce programs made for the Internet under the terms of the existing collective bargaining agreement, or they may tender a letter of adherence to cover such a program with terms negotiated with SAG as provided in the sideletter.

Regarding the sunset clause:

The sunset clause provides no guarantee that provisions in the agreement being negotiated that end up harming actors will be excluded from the next contract. Any such harmful provisions would have to bargained out. If management likes how they work, they will fiercely resist excluding them from future contracts.

Regarding “covered” performers:

The AMPTP’s statement on their proposal for “covered” performers completely misses the point. For any production that is made for new media at a budget threshold of less than $15,000 per minute, the producer would have the right to make that production without ANY covered performers if they so choose. That means that the producers would have the right, under our SAG contract, to produce non-union simply by not hiring covered performers. Further, under the AMPTP definition, some SAG members would not be considered “covered” and could find themselves in a non-union original made for new media production without union protections.

Regarding residuals in new media:

If an original made for new media production is streamed on new media, the budget is irrelevant because no residuals will be paid. There is one single exception for original new media productions that are produced for $25,000 per minute or more and distributed on a consumer pay platform for sale or rent (like iTunes). This is a highly unlikely and improbable circumstance. SAG has signed more than 500 producers to contracts for original new media productions. The average budget range has been $2,000 per minute.

Regarding the “template”:

We have tentatively agreed to most of the AMPTP’s new media template. The few AMPTP new media proposals with which we disagree are extremely important core areas like coverage and residuals for original made for new media productions re-used on new media. That is clearly the direction the industry is headed and at a much faster pace than anyone could have imagined just 7 months ago. Management has been extremely rigid. They are not bargaining, but rather are simply demanding that we agree to the new media “template” without modification.

Regarding the value of management’s proposals (the purported $250 million in raises):

Management has not offered $250 million in raises in their proposal. Their calculation includes their projections of overscale payments to certain actors over the life of the new agreement. It is impossible to estimate an increase in overscale compensation and more importantly, this is not even money that is collectively bargained. It is instead, individually negotiated by the actors who are able to bargain an overscale deal. Given actors’ recent experiences with salary compression, we know management’s projected value numbers are highly inflated.

To find out more about SAG’s TV/Theatrical contract negotiations, visit the Contract 2008 section of our website.


Statement of the AMPTP

Setting the Record Straight (Issued July 28, 2008)

Since the AMPTP-SAG negotiations ended with the presentation of the Producers’ final
offer on June 30, 2008, SAG’s negotiators have made a number of unsubstantiated statements that
we believe should be addressed.

July 28, 2008 Hollywood Reporter – Doug Allen

SAG Statement: The problem is they're asking us to accept a deal that doesn't have the minimum
standards necessary to protect actors and has negative consequences that could last for decades
and really affect the professional actor in maintaining their lives and families without having a
second or third job.

The Facts:

  • While SAG members currently have almost no new media production rights, the
    Producers’ new media framework grants SAG shared jurisdiction with AFTRA over
    original new media programs, including low-budget projects that employ a single
    “covered actor.”
  • All of the new media terms in the Producers’ final offer, including those related to
    original new media programs, are subject to a sunset clause that protects both performers
    and Producers by allowing the two sides to reevaluate all of the new media terms in three
    years and bargain from a point of greater knowledge about the market’s development.

SAG’s July 17 Message to Members

SAG Statement: It makes no sense for SAG to agree to allow the studios and networks to
exacerbate our problem by giving them a pass to produce entirely non-union under a SAG union
contract.

The Facts:

  • Since 2001, the Producers have been unrestricted in producing derivative and nonderivative
    new media projects non-union under Sideletter 21 of the SAG Basic
    Agreement and Sideletter H of the SAG TV Agreement. The Producers currently have
    the right to produce union or non-union. For seven years, the SAG collective bargaining
    agreement has given Producers the right to do just what SAG now claims is unacceptable.
  • The Producers’ proposal grants greater rights to SAG by significantly restricting the
    Producers’ ability to produce new media programs non-SAG.
  • All original new media programs employing a single “covered actor” would be
    automatically covered under the SAG agreement. This represents a significant
    concession on the part of the Producers.
  • Only low budget productions that do not employ a SAG “covered actor” would be
    outside the scope of contract coverage. This is intended to allow Producers to effectively
    compete and experiment with low budget original new media without being priced out of
    the market by expensive and restrictive contract terms.

SAG Statement: The DGA and WGA agreed to allow producers to make new media productions
entirely non-union, at the producers’ option, for projects below budgets of $15,000 per minute
(effectively, almost all new media productions for the foreseeable future.)

The Facts:

  • Those new WGA and DGA contracts extend union jurisdiction to new media productions
    budgeted below $15,000 per minute whenever a qualifying member, e.g. a ‘professional
    writer,’ is employed. The proposal to SAG does the same thing so that whenever a
    “covered actor” is employed, the production is also covered.
  • The definition of “covered actor” is broad enough to capture most professional actors
    (those with two TV or film credits, a national commercial, work on an audio book).
    These provisions also ensure union coverage for all actors, union or otherwise, if a single
    “covered actor” is employed.

SAG Statement: AMPTP’s recent offer to SAG doesn’t include residuals for programs made for
new media and streamed again on ad-supported new media platforms.

The Facts:

  • The Producers’ final offer includes residuals for both ad-supported and consumer pay
    reuse of new media programs derived from existing SAG television series. The
    Producers have proposed a more limited residual payment for original new media
    programs.
  • The Producers are unwilling to agree to the residual structure suggested by SAG for
    original new media programs because current economics indicate that the Producers are
    unlikely to even recover their production costs.
  • For the same reason, under the new media terms offered to SAG and accepted by the
    WGA, DGA and AFTRA, original new media programs budgeted at or above $25,000
    per minute as exhibited generate residuals at 3.6% of distributor’s gross on consumer pay
    platforms such as paid streaming or download-to-own.

SAG Statement: The template doesn’t protect actors … we don’t believe the template works for
SAG members.

The Facts:

  • The 33 pages of new media rights and residuals laid out in the AMPTP’s final offer give
    SAG members numerous terms that have never previously existed in the SAG contract.
  • Until SAG’s negotiators secure a new contract, its members will continue to work under
    the expired terms, which include little in the way of new media residuals or jurisdiction.
  • The Producers’ final offer would immediately give performers their first-ever residuals
    for ad-supported streaming and made for new media programs while doubling the rate
    that has been paid for permanent downloads. SAG members deserve to share in the same
    new media revenue that the other Guild members are already getting – and nothing short
    of a new contract will allow that to happen.

SAG’s July 28 Message to Members

SAG Statement: This does not mean that new media is our only focus. We know that you are
also concerned about such bargaining priorities as product integration, force majeure, background
actors’ issues and mileage. We will be communicating with you in more depth on these and other
bargaining priorities in the coming days.

The Facts:

  • SAG members continue to work under an expired contract for one simple reason: SAG’s
    negotiators are holding on several exceedingly expensive and unacceptable proposals that
    the Producers have rejected since these talks began over three months ago.
  • SAG’s negotiators have sought to focus attention on one narrow dispute in new media,
    while failing to mention that proposals such as a DVD residual increase remain on the
    table.
  • The Producers’ final offer includes significant gains in minimums, Pension and Health
    contributions and increases benefiting guest stars, background actors and other working
    performers. The Producers’ final offer of more than $250 million represents more than a
    25% gain over the 2005 contract, which SAG-AFTRA described as “the most lucrative
    deal in the history of actor/producer collective bargaining.”
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