Commercial actors reach tentative contract with advertisers

After an all-night bargaining session, unions representing Hollywood’s actors reached a tentative agreement with advertisers early Wednesday on a new contract covering work in commercials.

The proposed three-year agreement, which was widely anticipated, provides a 5% pay increase, contains about $21 million in increased contributions to union health and pension plans and, for the first time, establishes a pay structure for work made for the Internet and other new media, according to the Screen Actors Guild and the American Federation of Television and Radio Artists.

Additionally, the compact preserves for now the traditional method of paying residuals for commercials.

Squeezed by the recession and a long-term decline in national TV ad viewership, advertisers wanted to revamp the current “pay-for-play” system, in which actors are paid based on how often and where a spot runs. Advertisers prefer a gross-rating-points system, in which residuals would be tied to viewership.

The actors’ unions viewed that as a rollback, nearly derailing talks that began Feb. 23 and paving the way for a possible strike. Actors previously struck over commercials in 2000.

But neither side had much appetite for a similar showdown, given the swooning economy and the internal dissent that has severely weakened SAG’s leverage.

In a compromise, the sides agreed to hire a consultant to conduct a two-year study to test the proposed gross-rating points pay model.

The agreement, which includes separate contracts for each union and must be approved by their respective boards, covers more than 30,000 actors who work in commercials.

The accord brings a modicum of good news to SAG’s new chief negotiator, John McGuire, and interim Executive Director David White. The two faced pressure to deliver results after the board hired them to replace Doug Allen, who was fired.

“Our joint negotiating committee held together in the face of some very tough issues, and they stood firm for our core principles,” McGuire said.

Still, the wage hikes were lower than those negotiated by other Hollywood unions. SAG and AFTRA also agreed, for the first time, to cap studio contributions to the unions’ health and pensions plans.

“We came out very well,” said attorney Doug Wood, chief negotiator for the advertisers.

Still uncertain is the status of SAG’s biggest contract covering film and TV work. The union’s members have been working without a contract for nine months.

After a series of disputes last year, AFTRA broke ranks and negotiated a separate film and TV contract for its 77,000 members.

--

richard.verrier@latimes.com