Writers Guild of America contract secures $65 million more in health plan contributions

As the Writers Guild of America moves closer to ratifying its agreement with the major Hollywood studios, key details of the proposed deal have emerged, including increases to the union’s employer-funded healthcare plan, which had faced mounting deficits.

Some details of the agreement, which was reached early Tuesday, are contained in a recent summary that the guild sent to members outlining its achievements during the recent round of negotiations. The deal also provides for increases in minimum pay and residuals from streaming TV services such as Netflix and Amazon.

The complete contract hasn’t been released by either the WGA or the Alliance of Motion Picture and Television Producers, the bargaining organization that represents the major Hollywood studios and networks.

Under the tentative agreement, employer contributions to the guild’s health fund are set to rise from 9.5% of writers’ gross compensation to 10.5% at the start of the agreement. The amount will increase to 11.0% in the second year and to 11.5% in the final year of the three-year contract, resulting in a total of $65 million in additional contributions for the health fund.

WGA members don’t pay monthly premiums for healthcare. Instead, the fund relies on contributions from employers who chip in a percentage of writers’ pay.

During negotiations, the WGA said the health fund faced ballooning deficits as employer contributions have failed to keep up with healthcare expenses. The issue was a key sticking point in the talks, which began in March and saw the two sides walk away from the table twice before reaching a last-minute deal.

The guild also said it has agreed to implement cost savings of $7 million per year for the health fund on about $150 million in annual spending. It said new revenue and savings add up to about $86 million for the fund.

The gains in the health fund will achieve “the goal of solvency for the health plan for the duration of the agreement, and for some time thereafter,” the guild said in its message to members.

Leaders of the East and West Coast branches of the WGA have approved the deal, which now much be ratified by the union’s membership.

The recent negotiations also yielded increases in minimum pay for writers, with most minimums set to rise by 2% in the first year and by 2.5% in both the second and third years of the contract.

Streaming residuals are also set to increase, but the guild provided fewer details. Streaming residuals for the domestic market will kick in for writers after 90 days, instead of after one year. A new residual will be established for streaming content shown outside the U.S., the WGA said.

Additionally, the union said it secured higher pay for writers who spend more than about two-and-a-half weeks working on a TV episode. Writers had complained that their incomes had been eroded by the move toward shorter TV seasons on shows like Amazon’s “Bosch” and Netflix’s ”Orange Is the New Black.”

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