Directors, Studios Wrap a 3-Year Pact

Negotiators representing Hollywood directors reached agreement on a labor pact with studios and networks Thursday that could prompt two other key entertainment guilds to resolve their contract differences.

The 12,800-member Directors Guild of America and the Alliance of Motion Picture and Television Producers agreed to a new three-year deal, which includes a boost in healthcare benefits and increases in pay and residuals.

But the agreement sidesteps one of the most contentious issues for Hollywood unions: getting a bigger percentage of the studios’ booming DVD revenues.

Thursday’s agreement comes as Hollywood writers represented by the Writers Guild of America, West, are working without a contract. Members of the Screen Actors Guild and its sister American Federation of Television and Radio Artists are working under an unusually short one-year agreement set to expire next year.

Although both groups have unique concerns not shared by directors, Thursday’s agreement could help push them toward a settlement through a longtime industry practice called pattern bargaining. This means that the first guild to reach an agreement often provides a blueprint for other union negotiators on key issues such as pay increases and health benefits.

Given the directors guild agreement, it seems unlikely that the other unions will win major concessions on how the spoils from DVDs are divided.

Nonetheless, the Screen Actors Guild late Thursday said it planned to aggressively negotiate its upcoming contract over such issues as increasing residuals and boosting its health and pension plan.

Unions have argued that their members deserve a bigger piece. But the studios have said they won’t budge on the issue, contending that the profits are needed to offset soaring production and marketing costs.

Faced with such resistance, DGA President Michael Apted said, “Our view is that this is the wrong issue at the wrong time for our guild.”

Apted said members were earning “unprecedented residuals” from home video, citing a 54% increase since 2000 to $53 million a year.

DGA member Gil Cates added that he and the other negotiators chose to focus on the more pressing issue of healthcare “rather than focus our energy in an area where seeking change is both complex and risky” for directors.

The directors guild began talks with studios last month, well ahead of the contract expiration date of June 30. Entertainment contracts typically are negotiated months in advance to avert disruptions during film and TV productions, which require long lead times.

The DGA represents film and TV directors and also includes unit production managers, assistant directors, technical coordinators and stage managers.