Is a Writers' Strike Near? Studios Reject SAG's Request for New Talks

Two months after the Screen Actors Guild contract with the Hollywood studios and television networks expired, actors are still working under expired terms and with an eventful September coming to a close that included elections and a polling of membership support for continued negotiations, little forward progress has actually been achieved by either side.

The Hollywood talent unions usually ask for larger annual contributions from the networks and studios -- companies collectively represented by the Association of Motion Picture and Television Producers (AMPTP) -- to their pension and health care funds, as well as increases in minimum wages. Negotiations this year have been complicated by the ascendancy of the Internet as a new distribution medium for traditional content and the rise of original digital content such as webisodes, muddying the water even further.

The disagreement is simple: content companies don't want unions to cover online distribution or digital property, but the unions obviously do.

The practicality of such disagreements are far more complex, however. The new contract provisions, usually referred to collectively as "new media", are mostly about the right to cover digital content at all, and residuals, the literary equivalent of book royalties. Residuals are payments for reuse of material such as when television shows hit syndication or are sold on DVD. Directors benefit less from residuals than do actors and writers so their pattern of bargaining was somewhat different this year, without even accounting for the distinctly different personalities of each union.

The Writers Guild of America is considered militant and willing to strike at any time. The Directors Guild of American is the literal opposite of the writers, seen as too eager to please the studios and willing to take any deal it is given, and has never struck in its entire existence.

The Screen Actors Guild's 100,000+ members are perceived to sit somewhere in the middle.

On September 12th, the AMPTP announced that it had secured a new contract with casting directors which have only recently gained union representation under the International Brotherhood of the Teamsters, and once news of the deal hit the trades, the AMPTP immediately lashed out at SAG for its alleged foot dragging. Others were just as quick to note that casting directors don't benefit from and don't care about new media like writers and actors do.

The Directors Guild of America has earned a reputation as a bit of a pushover when it comes to negotiating their contracts with the multinational conglomerates that make up the AMPTP, going so far as to hash out agreements as many as six months before their previous contract would have expired. The talks between the WGA and AMPTP which began before the DGA talks but ended months after a framework was in place were bitter from the beginning, which saw the writers walk out in early November of last year upon accusations of broken promises and dishonest intentions.

Although most feature film production continued unabated due to a much longer lead time in script development -- some big hitters such as Dan Brown's follow-up to The Da Vinci Code were ready to go but then put on ice without anyone available to fix script problems that normally would be handled while the film was actually shooting -- the entire fall television season was cut short when scripts began running out. Some shows were shut down nearly instantaneously while others managed to continue production into late December.

Actors from top-rated shows such as Desperate Housewives were quick to join the picket lines in a show of support which, at times, made production impossible on shows that did still have completed scripts that could be shot but nobody to act in them.

Few shows produced more than a dozen episodes last season as a result.

Two recent events have given mixed signals about how prepared the membership is to see things through. On September 17th, the SAG leadership revealed the results of a postcard poll asking the 100,000 strong union if they wanted SAG to continue negotiating for a better contract than the AMPTP was offering, or if they should accept the deal currently on the table which was essentially the same deal they had given to the WGA back in February -- after they struck to get any new media provisions at all. While the congloms made light of only 10% of the membership bothering to respond to the poll, SAG's national executive director Doug Allen just as quickly pointed to the fact that of those who responded, 87% said they wanted a better deal.

While this would lead the casual observer to believe that general interest is down but that support for securing a better deal is high amongst those active in union politics, just 24 hours after the poll results were released, an election resulted in a redistribution of power at the upper levels in what some saw as a rebuke of Doug Allen and President Alan Rosenberg's strategy for getting stronger new media provisions without the need for a strike.

SAG's board is self-divided into factions which are roughly equivalent to political platforms. The more seats a faction holds, the more power it has. While Allen and Rosenberg's faction -- called Membership First -- was on the losing side of the recent election to the upstart United for Strength, they hold a significant number of seats and even if the margin has shrunk, they still hold the upper hand in nearly every respect. The result may be more internal pressure to take the current deal and work on making gains later, but as is usually the case in the world of union politics, there's no such thing as a guarantee.

The negotiating committee is not elected so it's not likely that there will be any immediate changes at the table, assuming the two sides can agree to restart talks at all.

The AMPTP issued their "final offer" to SAG three months ago, a term that holds legal significance in labor law in that it gives management legal cover to declare an unresolvable impasse, clearing the way for it to unilaterally impose a short-term contract on the actor's guild whether they like it or not. SAG leadership was cautioned about the tactic by the WGA, revealing that the AMPTP's chief negotiator had issued as many as a dozen "final offers" over the course of the the writers strike.

Rosenberg and Allen published a letter recently sent to several of the CEOs of the largest and most influential AMPTP members -- News Corp, Disney, etc -- on September 29th inviting the congloms back to the bargaining table.

"We are prepared to meet formally and continuously until we reach agreement", Allen and Rosenberg wrote, "we owe it to our constituencies and the thousands of others in this industry that depend on a productive, stable and uninterrupted relationship between Screen Actors Guild and the networks and studios."

The letter closed with an open invitation to discuss a date at which the two could reopen talks.

Although the letter was directed to the CEOs that collectively control the AMPTP from the national director and president of SAG, the response from AMPTP negotiator Nick Counter was anything but comforting. Counter's official response was as clear as it was stern: "We do not believe that it would be productive to resume negotiations at this time given SAG's continued insistence on terms which the Companies have repeatedly rejected."

Such a plain refusal to bargain on the part of the congloms would make it appear that the actors only have two choices going forward. Either they accept the same contract the WGA had to strike to achieve, or they themselves can walk off the lot and see where it leads. It is worth noting that the AMPTP had made identical statements to the WGA both before the strike, and several months in, but the writers held their ground and eventually the CEOs that Allen and Rosenberg reached out to stepped in and gave the writers most of what they wanted.

Whether the CEOs are looking to avoid repeating those concessions with SAG, or are simply playing a high stakes, extremely expensive game of chicken, is anyone's guess. Many writers were not pleased with the deal the WGA agreed to, even though it was ore than they would have gotten had they settled before the strike. The writers proved that labor stoppages in Hollywood can still work, and ultimately that's the only real power a union has.

An actor's strike would have more immediate and serious consequences for the studios and networks when compared to the writers strike. Television shows require that scripts be written far in advance of production for obvious reasons, but the consequence is that if writers stop working today, any given series currently in production will have as many as five or six scripts already completed that can be shot and aired at a later date, ultimately delaying the damage for months. This was in evidence when the WGA struck on November 5th of 2007 but some series didn't run out of new episodes until late January and even early February of 2008.

As far as creative assets go, you can't shoot anything without an actor. The day that SAG calls a strike is the day that all television and movie production comes to a grinding halt, with the exception of some independent productions. Many independent studios have already signed interim agreements with SAG that would allow them to continue using union talent during a strike, as the terms of those agreements are roughly equal to what SAG is seeking from the AMPTP.

The writers guild used this tactic to put David Letterman back on the air with his writing staff while Jay Leno and the other late night talkers were forced to improvise sketches, increase interviews to fill time, and in some cases forced hosts to write for their own shows in violation of the strike rules -- a frowned upon practice known as scabbing.

The success of these independent agreements is debatable, but nonetheless place additional pressure on the AMPTP to bargain rather than dictate terms, a frequent criticism leveled by writers during their 21-week-long strike.

SAG's leadership released the following statement yesterday in response to the AMPTP's refusal to restart negotiations:

"We are disappointed to hear that the employers and their AMPTP representatives are refusing to engage in the process necessary to complete a deal. We do not believe that their rejection of our reasonable request is in the best interests of our members or the industry. Our National Negotiating Committee will be meeting later this week to consider management's response."