The Directors Guild of America (DGA) and the Alliance of Motion Picture and Television Producers (AMPTP) announced today that they have concluded a tentative agreement on the creative and economic terms of a new three-year collective bargaining contract. Details of the new agreement will be submitted to the Guild's National Board for approval at its regularly scheduled meeting on Saturday, October 2, 2004. The DGA's current contracts expire on June 30, 2005.
"We walked into negotiations with two goals in mind – getting the best possible deal for our members and keeping our members and the industry working," announced Gil Cates, DGA's Negotiating Committee Chairman. "And we were successful on both counts. From the start, the central issue our Guild sought to address in this round of negotiations was to resolve the crisis facing our Health Plan and protect the health benefits of our members, retirees and their families. I am proud to announce that in addition to successfully funding our Health Plan and keeping our members and the industry working, the total economic benefits package we have negotiated is the largest in Guild history."
The DGA Health Plan, like most health care plans across the country, was in future financial peril due to projected annual double-digit cost increases, which would have resulted in the Plan being without funds to pay benefits by 2008. "We had no choice but to create a solution that addressed spiraling health care costs during this round of negotiations," stated Cates. "We have taken a Health Plan that was projected to have run through its reserves by 2008 to one that will have a healthy reserve of more than $40 million."
Cates continued, "Reaching resolution on these issues required leadership and perseverance. The DGA National Executive Director Jay Roth, his staff and the entire Negotiating Committee should be commended for their stewardship in securing what is truly important to DGA members and retirees – protecting their health and the health of their families."
DGA President Michael Apted stressed the advantages of negotiating early and the success the Guild has achieved with this strategy. "Everyone at the table recognized what was at stake for our membership and for the industry as a whole. Early negotiations offered both the opportunity for Gil and the negotiating team to get the best possible deal - the proof of which is in the significant gains in health care, wage increases and creative rights made today on behalf of our members."
Apted further stated, "This deal not only resulted in significant gains for our members, it also reaffirms that good deals can be made early between labor and employers – keeping our members and the industry working."
"At the end of the day this is an excellent deal for DGA members and for the industry" said DGA National Executive Director Jay D. Roth. "Health care is an issue that affects each and every one of our members — and each and every one of our members will benefit from the deal we negotiated this year. We appreciate that the employers recognized the importance of this issue and I am proud to have been a part of negotiating this successful deal on behalf of our members."
Cates noted, "We had meaningful discussions with the studios about the challenges of reality programming. Both sides made great headway in understanding each others' needs and concerns and we are hopeful that these discussions will lead to future gains for DGA members in these areas."
The parties began formal negotiations on Monday, August 23, and reached tentative agreement today. The DGA had been working on its proposals since early in the year and informal preliminary talks had begun earlier this summer. Complete details of the agreement will not be disclosed until the DGA Board meeting on October 2.
Tentative Agreement Highlights
Some of the highlights of the economic agreement include wage and residual increases, feature director health care cap increases, solution of long-standing episodic television residency issues, improving conditions for below the line members in multi-camera dramatic programming, new economic provisions on use of excerpts in interactive games and future studio by studio meetings regarding utilization of UPMs.
Some of the creative rights for film and television directors that were negotiated by the DGA Creative Rights Committee (led by co-chairs Steven Soderbergh and Jonathan Mostow) include new protections for directors of feature film and long form television in connection with DVD releases; new guarantees of director participation in the ratings process; and agreements to investigate the impact of visual effects (VFX) on the filmmaking process and to discuss new approaches to credits issues. The Television Creative Rights Committee made singular achievements in agreements to continue the highly successful campaign to ensure timely script delivery in episodic television - with an added financial penalty for egregiously non-compliant productions; and to initiate long overdue efforts to improve public recognition of directors of television pilots. Additional provisions improve directors' ability to manage their sets and television movie directors' participation in looping.
The Guild also agreed with the producers to aid efforts to promote and launch new dramatic programming. The new agreement will provide for a free use of the first two episodes in the two-month period after initial exhibition and for a one-year deferral of below the line wage increases in new one hour series. Cates said, "Dramatic television programming is the lifeblood of many of our director members and their teams. It is in the best interest of the Guild to ensure that we do all we can to strengthen the success of dramatic programs in their first season."
President Apted also addressed the DGA's position on the issue of home video residual formulas. "After careful consideration and intensive research, our view is that this is the wrong issue at the wrong time for our Guild. The reality is that our members are earning unprecedented residuals. Residuals for our members have grown from $36 million in 1984 to $225 million in 2003. Since 2000 alone, home video residuals for our members, including DVD, have grown from $29 million to $53 million, a 54% increase. In fact, in the last year alone, our members' home video residuals have grown by 35%."
Apted continued, "When we looked further, we saw a residual system that paid our members without regard to the performance of their films. Directors have continued to receive substantial residuals payments whether or not their pictures are profitable. The current formula ensures that all our members are being compensated for the re-use of their work. At this time, we do not feel that it is worth risking this system that rewards all of our members.
Cates concluded: "Rather than focus our energy in an area where seeking change is both complex and risky and where our members are already prospering, we addressed the most pressing concern affecting all our members – ensuring that their health care is protected."
Subject to the approval of the Guild's National Board on October 2, the membership of the DGA will vote on ratification of the new contract.
Nick Counter, President of the AMPTP stated, "We commend the DGA leadership for their commitment and thoughtful approach to what are complex and crucial issues. Early negotiations allowed us to reach a fair and equitable deal while preserving the stability of the industry."
