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Directors Guild, AMPTP Yea Contract

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The Directors Guild of America has approved a "historic" interim agreement with the Alliance of Motion Picture and Television Producers that will adapt to new technologies, while also raising minimum salaries and residual payments.

The pact includes safety and creative-rights provisions; it also calls for a broad-based meeting of producers and unions on runaway production, and a continued industry residuals study in collaboration with the Screen Actors Guild.

DGA's national board of directors last Saturday voted unanimously to recommend the new three-year agreement's ratification to the union's 12,416 members. If approved, the pact becomes effective July 1, 2002 and expires June 30, 2005. Both sides had agreed to early talks, which actually concluded after only two weeks of bargaining. The present pact expires in seven months.

The union deems the settlement "historic" because it adapts "outmoded" pacts to new technologies "that are modernizing the method of television production. This new 'blended contract' agreement recognizes that the methods of recording television programming are changing, and will cover all prime-time dramatic programming regardless of whether it is shot on film, traditional videotape, or digital video. The blended contract provides certainty to DGA members and producers as technology evolves," according to a DGA statement.

Under the current pact, DGA residuals for 2001 should total around $180 million. That figure should increase under the new contract because of increases in wages and residuals. According to DGA, with the exception of network prime-time programs, all minimum salaries and residual base rates will increase by 3.5% per annum each year, effective July 1, 2002, 2003 and 2004. This amounts to a compounded increase of 10.87%.

Directors' initial minimums for network prime-time programs, including residuals base rates, will increase by 3.0% per annum, amounting to a compounded increase of 9.27%.

As for foreign residuals, the new contract adds a fourth level of residual payments which extends into perpetuity, and consists of 1.2% of the distributor's foreign gross in excess of a certain amount based upon the length of the program. According to the guild, previous contracts had three separate levels: an initial residual payment and two additional payments made when certain distributor's foreign gross amounts were met. After those three payments, no more followed, regardless of the profitability of the show.

Runaways and Residual Study

The issue of runaway production —films which studios and networks conceive in the U.S., then move out of country, primarily Canada, for less expensive labor and tax breaks—is at a boil now. Anti-runaway legislation is currently before Congress; and SAG has joined a petition asking the federal government to consider placing a tariff on runaways when they return to the U.S. The DGA joined SAG a couple of years ago in a study showing that runaways cost the U.S. economy as much as $10 billion.

The DGA, in the new pact, has prompted the AMPTP no later than Jan. 1, 2003, to convene a meeting on runaways with producers and representatives of the major entertainment unions. They include the DGA, SAG, the American Federation of Television and Radio Artists, the Writers Guild of America, the International Alliance of Theatrical Stage Employes, and the Teamsters. The talks will include "ways of resolving or mitigating these [runaway] problems, including possible contractual remedies," according to the DGA.

The producers also agreed with the directors to continue participating with SAG in the industry residuals study, which SAG particularly had called for some three years ago, and producers agreed to. In the agreement, the studios and networks were to provide specific production figures which would help the guilds better determine what residual increases should go into new contracts. SAG was unhappy, however, with the residual data received before their negotiations with AMPTP earlier this year. While the actors agreed to a new pact, their leaders also complained that the residuals data wasn't compiled in a reasonable, readable manner; and that it came into the guild's hands only at the time of negotiations. The DGA seemed to have no complaint about such data during its negotiations.

Safety and Creative Rights

A first-time safety provision within the pact allows the first assistant director—when members of the shooting crew have worked 16 hours from crew call—to hold a meeting to discuss safety issues involved with continuing production. The DGA also will distribute a safety checklist to producers by Feb. 15 of next year.

A major creative-rights issue involved "the industry-wide problem of late script delivery in television, which impacts production costs and the ability of TV directors to do their jobs," the guild stressed. The two sides agreed on a process to address this situation, including producers providing the DGA information to help directors monitor the timeliness of script delivery, and the two sides agreeing to arbitration to determine "the appropriate relief for late script delivery." The guild wasn't specific about what determines "appropriate relief."

To better insure equal employment opportunities for DGA minority members, producers agreed to designate executives to meet with DGA reps once a year on EEO matters.

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