by David Robb
March 12, 2019 7:38pm
UPDATED with talks ending for day, new talks scheduled: The WGA and the Association of Talent Agents have scheduled another meeting for Thursday after concluding negotiations today, the first meeting between the two sides since February 19. The talks come in advance of the April 6 expiration of their current franchise agreement.
WGA Report Labels Big Agencies A ‘Cartel’ As Talks Resume With ATA
The ATA today offered a deal to the WGA that would increase transparency in agency dealings with writers but would not eliminate packaging fees and production deals with affiliates – the guild’s two main objectives in the negotiations.
The WGA called today’s bargaining session “a small step forward for the parties,” but said “all major issues are still on the table.” When the two sides meet Thursday, the guild says it will make a counter-proposal “in specific contract language.”
“The response from the ATA is what we expected in a first proposal,” the guild said of today’s meeting, which insiders described as cordial and business-like. The agencies, the guild said, “couched their proposals as all about an individual writer’s ‘choice.’ However, theoretically writers already have that ‘choice.’ Their proposals require each individual to respond to a powerful agency – that is virtually no choice at all. The solutions in the new agreement need to be collective through the Guild, not individual.”
“We come to you with a solution to make our industry function more effectively and fairly for all,” ATA president Jim Gosnell, who is president and CEO of the Agency for the Performing Arts, told WGA negotiators (read his statement in full here). “One thing is certain. If we are to come up with a joint agreement, which I know our clients desperately want us to have, then we need to roll up our sleeves and get to work on a constructive process that will result in an agreement that works for everyone. We need to avoid the name calling and divisiveness that get us nowhere and will only set us back. Your agents are not your enemies, and they do not want to take advantage of you.
“At the end of the day,” he told the WGA team, “the industry is looking to us to find common ground and to develop fair and reasonable solutions to these issues. They couldn’t care less about our bickering and unproductive rhetoric from either side.
“The members of the ATA are committed to working toward that solution and don’t think we should leave this room without a clear schedule. We’re ready to meet every day for as long as it takes between now and April 6, 2019 to reach our new agreement – breaking into smaller groups as necessary.”
“We agree on the majority of issues you have proposed,” Gosnell told the guild. “With some nuance, changes, additions and modifications, I truly believe we can come to a consensus. From diversity, to hostile work environments, to timely payment of writers, and writers not working for free – these are all issues on which we agree with you 100%… because they’re reasonable, make perfect sense, and are in the best interest of everyone concerned.:
Focusing on the two main issues – packaging and affiliate production – he said that “the research of our members has yielded similar data points. The highest-level guild members are doing incredibly well. The total number of overall deals is now close to double what it was in the previous three years, and some members of this WGA committee have achieved success like never before seen in our industry. They deserve and have earned their success. We are proud of them and our members are proud to be part of making these state-of-the-art deals. But, unfortunately at the lower to mid-level, total writer compensation on a yearly basis feels stagnant and many are feeling left behind.
“We want you to know that we hear you loud and clear. There is income disparity not only in this guild, but in all the guilds. This condition is not limited to the entertainment industry; it’s in lock step with what’s taking place in our U.S. and global economy. But make no mistake, it is not the result of packaging and affiliated production. In fact, the data is clear that writers working on agency-packaged shows make the same as those that are not working on packaged shows, but take home more since they do not pay a commission. So, the theory that agencies ‘sell out their clients on packaged shows’ is not supported by the facts.”
“One thing is certain,” Gosnell said. “If we are to come up with a joint agreement, which I know our clients desperately want us to have, then we need to roll up our sleeves and get to work on a constructive process that will result in an agreement that works for everyone. We need to avoid the name calling and divisiveness that get us nowhere and will only set us back. Your agents are not your enemies, and they do not want to take advantage of you. If that were true, we wouldn’t be here today, and you would not be represented by us. Today, we are going to provide you with a thoughtful response to your proposals. We agree on the majority of issues you have proposed. With some nuance, changes, additions and modifications, I truly believe we can come to a consensus. From diversity, to hostile work environments, to timely payment of writers, and writers not working for free – these are all issues on which we agree with you 100%… because they’re reasonable, make perfect sense, and are in the best interest of everyone concerned.”
The WGA said in a report released today that the big agencies’ packaging fees and side deals with affiliated entities are driving down WGA members’ earnings, but Gosnell said that those aren’t the real reason why many writers have seen lower take home pay – and pledged that the ATA-represented agencies are committed to raising their clients’ income.
During a phone-in press conference today, former WGA West president Chris Keyser, co-chair of the guild’s negotiating committee, said: “Packaging fees and agents’ production arms make a mockery of the fiduciary duty we are owed by our representatives. Yes, we have taken too long to demand these practices end. But the persistence of a corrupt system does not make it right. While the changes are not small, they are what is required for the right to represent us.”
The WGA has also called packaging “illegal blackmail” and “conflicts of interest” to the agencies’ fiduciary duties to their clients.
Gosnell said, however: “There are four major reasons why some writers are making less – consolidation, streaming, globalization and short orders. It’s an undeniable fact that most shows are 8 to 13 episodes. As a result, even as writers’ quotes increase, their take home compensation is either flat or down, simply because they’re working on fewer episodes with production schedules spread over longer periods. Conflating writer salaries being down with affiliated productions and packaging is not supported by the facts. Furthermore, to say that agencies can’t package or take sales fees on movies would shut down the independent movie business, as we know it. We don’t believe your members or you want that either.
“What we will propose today is a reasonable, realistic and fair solution to a very complex issue – it’s all about choice and empowerment. It will enable writers to have a choice. It will take the power and put it into the hands of the client, which is exactly where it should be. As I conclude, let’s continue to work together and partner on the real issue – better economics for writers. Let’s commit to serving them and fighting the conglomerates that are threatening their wellbeing – together. Let’s stop the daily press tactics, the threatening of guild members who don’t agree with the opinion of this committee, and the forcing of agents and clients to choose between guild or agency. We’re not asking our clients to leave their guild, and the WGA should not tell its members to leave their agents, many of whom have represented them for decades.”
He then introduced ATA executive director Karen Stuart, who presented the ATA’s response to the guild’s proposals, which he said are “grounded in simple principles of transparency and disclosure.”
Stuart called the ATA’s package of proposals a “Statement of Choice” (read it here) that reflects the seismic shifts in the media landscape and fosters the best outcome for artists for the foreseeable future.” The ATA, she said, “has carefully and thoughtfully reviewed the WGA’s 27 proposals and reflected upon conversations initiated with hundreds of writer clients during the past weeks.” The result, she said, is a “balanced and reasonable solution” that will ultimately “best serve the interests of all artists.
Here are the ATA’s counterproposals in their entirety:
ARTISTS’ CHOICE ON PACKAGING
• The choice to work on a packaged show always belongs to the writer client.
• No writer client shall ever be required to work on a packaged show and an agent shall always follow the client’s directive.
• Prior to submitting a writer client to a packaged project (i.e., a project where the agency has already been granted a packaging fee at the time of submission), an agent shall: o Inform the writer client of the existence of the package; o Advise the writer client that she/he may choose to be submitted to the packaged project; and o Receive the writer client’s consent to proceed with such submission, but only after informing the client of the foregoing.
• A creator, who is designated to be a packageable element, may choose whether or not her/his agency shall package her/his original script, or development in an overall deal.
• An agency shall not request a packaging fee unless the agency has: o Engaged the writer client who is designated to be a packageable element in a transparent discussion regarding the details of the packaging agreement and fee; and o Received the client’s consent to proceed with such request.
• An agency will provide a writer client designated to be a packageable element with any agreement containing the terms of the agency’s package agreement.
• No writer client deal or pitch will ever be held up by an agency for purposes of such agency procuring a package, unless specifically authorized to do so by the agency’s packageable element.
• An agency shall not perform independent film packaging, financing, or sales services on behalf of a writer client unless the agency has:
Engaged the writer client in a transparent discussion regarding the details of the agency’s fees for such services; and o Received the writer client’s consent to proceed with such services.
ARTIST’S CHOICE ON AFFILIATED ENTITIES
• The choice to work with an affiliated entity always belongs to the writer client.
• No writer client shall ever be required to work with an affiliated entity and an agent shall always follow the client’s directive.
• An agent shall, prior to submitting a writer client to an affiliated entity for engagement of services or sale of rights: o Inform the writer client of the existence and nature of the agency’s relationship with the affiliated entity; o Advise the writer client that she/he may choose to be submitted to the affiliated entity; o Advise the writer client that she/he may choose to enter into a transaction with the affiliated entity; o Advise the writer client that she/he may choose to direct the agent to simultaneously offer the client’s material or services to other bona-fide competitors of the affiliated entity; o Advise the writer client that she/he may choose to seek independent counsel at any point in the process and recommend that she/he do so; and o Receive the writer client’s consent to proceed with such submission, but only after informing the client of the foregoing.
• An agent shall not represent a writer client in connection with the engagement of services by or sale of rights to an affiliated entity unless: o The agent reasonably believes that such engagement of services or sale of rights is in the best interests of the writer client; o The terms of such engagement of services or sale of rights are negotiated in good faith and at an arm’s length basis; and o The agency complies with the following requirements: No individuals primarily involved in the day-to-day operations of the agency shall be primarily involved in the day-to-day operations of the affiliated entity, and vice versa; The agency shall not participate in any of the affiliated entity’s decisions regarding the engagement of services or sale of rights, other than in the agency’s representative capacity of its clients, consistent with the fiduciary duties owed to such clients; The agency shall maintain the confidentiality of its writer client’s confidential information from such affiliated entity, in the same manner it maintains the confidentiality of such information from an unaffiliated entity; and The agency has (i) a written conflicts policy that is made available to writer clients, and (ii) annual training on conflicts for all employees.
FOSTER AND ENCOURAGE DIVERSITY WITHIN OUR INDUSTRY
• An agency will not discriminate and will use good faith efforts to promote diversity and help diverse writer clients get hired.
• Agents will advise showrunner clients regarding diversity and encourage the hiring of diverse writers.
• ATA will work with the WGA to collaborate on developing diversity metrics and advancing the employment opportunity for all writer clients.
EXPAND PROTECTIONS FOR ARTISTS’ WORKING CONDITIONS
• An agency will not send writer clients to any place where there is a reasonable basis to believe they might be harassed or subjected to a hostile work environment.
CREATE NEW ENFORCEMENT MECHANISMS
• ATA will work with the Guild to develop a real enforcement mechanism that makes sense and moves quickly to correct abuses, including streamlined arbitration where appropriate.
DEMAND TRANSPARENCY & GREATER DISCLOSURE • Agents will act as fiduciaries for their writer clients and will keep them informed as to the status of all deals and submissions.
• Agents will inform writer clients if they know of any problems with the rights to a project, or with payments due from a project.
• Agents will use the same efforts to keep their writer clients’ information confidential as they do their own information, or more so.
• The ATA will work with the Guild to develop automatic systems for invoicing and notification so that the writer client (and if they client wants it, the WGA) will know in real time what the client is owed on a project and if payment is late.
• The ATA and WGA will activate a standing committee to address matters of interest to both parties, including, but not limited to, industry best practices and any concerns regarding the AMBA. The standing committee will meet at least quarterly and report results to all parties. • ATA will serve as a resource to assist WGA in advance of, and in connection with, its collective bargaining negotiations, providing insight about specific negotiations, deals, trends, global strategies, and similar.
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