The Writers Guild of America’s negotiating committee outlined its agenda for two critical issues under discussion in the negotiations with the AMPTP that started this week: increases in residuals for streaming projects and changes to the guild’s pension plan.
The agenda was shared in a pair of emails sent Wednesday from the committee to WGA members as a substitution for membership meetings that are traditionally held prior to the start of contract talks but were cancelled due to the COVID-19 pandemic. Streaming has been expected to be a core talking point for all of Hollywood’s guilds as they look to improve compensation for their members on a surge of new films and TV shows launching on platforms like Disney+, HBO Max, and Peacock.
Prior to the pandemic, the contract agreed upon between the AMPTP and the Directors Guild of America included a 50% increase in streaming residuals for its members on TV shows and films with budgets of at least $13 million that are made for a service with more than 20 million subscribers in the U.S.
“Some of us working for streaming services don’t earn minimum at all. For lower-budget streaming comedies and dramas, weekly compensation and script fees are completely negotiable, so we need to lower the budget breaks to ensure non-negotiable minimums for writers,” the WGA wrote. “Comedy-variety shows on streaming services – unlike on television – currently have no minimums either. This, too, must change.”
WGA is also seeking increases in script fees and minimums for all projects, as well as changes to how studios fund the guild’s pension plan. The WGA notes that TV residuals, which contributed to the guild’s health and pension funds, are declining with the rise of streaming. With the economic downturn brought by the pandemic expected to put strain on the guild’s pension funds, the WGA is looking for “additional funding from our employers in order to put our pension plan on strong enough financial footing… to preserve pension benefits for future retirees.”
The AMPTP is currently in negotiations with both the WGA and SAG-AFTRA, with the existing contracts for both guilds expiring on June 30. With offices in Los Angeles still closed due to the pandemic, contract talks are currently being held remotely.
Read the full memo from the WGA below:
In 2017, after years of healthcare costs outpacing inflation, we needed more money for our health plan. At the time, our plan was projected to run a deficit of $70 million by 2019. We used our collective power, including taking a strike authorization vote, to secure an increase in the employer contribution rate from 9.5% to 11.5% over the life of the 2017 MBA. Today our health plan is on solid ground; we ran surpluses over the last three years, and increased the number of months our health plan has in reserve.
Now, we need to secure additional funding from our employers in order to put our pension plan on strong enough financial footing to weather this market downturn and preserve pension benefits for future retirees. Currently, our employers contribute 8.5% of our compensation to the plan, which totals almost $150 million annually. While our pension plan is designed to pay out benefits over many decades, federal legislation mandates a short-term focus on investment returns that can threaten our benefits. In 2006, Congress passed the Pension Protection Act (PPA), which added new requirements for pension plans like ours that could require us to make changes quickly in response to a short-term decline in investment returns. Due to this law, and lingering effects of the 2008 market crash, a severe enough market downturn could force us to make future benefit cuts.
An increase in the employer contribution rate is not enough. We need to substantially increase the caps on contributions for screenwriters and writers of long-form TV. Members of teams should get full contributions for their work as individuals, not on reduced amounts simply because they are employed as a team. We also need to increase the type of compensation and residuals subject to benefit contributions. Most TV residuals generate contributions to the pension plan and health funds, but it’s not the same for streaming residuals. As streaming reuse is replacing TV reruns, streaming residuals need to generate contributions to our benefit funds. We need to change that now before streaming residuals replace other residuals, ultimately putting additional financial pressure on both the pension and health funds.
Our pension plan is a critical source of long-term financial security for middle-class writers, and a benefit that writers who came before us fought hard to achieve. Even if you’re early in your career and not thinking about retirement, one day it will come, and we want to make certain your WGA pension will be there for you.