Joint Policy Committee

Negotiations Update

As you are all aware, we're approaching the "midnight hour" in our negotiations.  While both sides have made major progress and I remain cautiously optimistic, the next couple of days will be critical to reaching a new agreement.  In the meantime, there is no reason to believe that there will be any immediate disruption in commercial production even if we don't come to a final agreement before midnight, March 31.  Both sides continue to have open and productive negotiations. 

Important Note to Readers

Apparently, there are some who believe this blog represents a violation of the press embargo on negotiations.  That is simply false.  Anyone reading the blog should readily see that it refrains from discussing the details of any of the discussions between the industry and the unions.  Rather, the blog keeps readers up to date on the overall tenor and progress of negotiations without specific detail.  Such communication is consistent with the press embargo and necessary to address concerns of those in the industry who are being misled by reports claiming the negotiations are going poorly.  As I have stated, such reports are simply untrue.  While both sides are addressing serious issues, the parties at the bargaining table continue to work together to find common ground.  This blog will continue to report truth and provide reality to readers.

Negotiations Update

Yesterday, you may have read reports in the trades that SAG and AFTRA had prepared a strike authorization letter to send to their members and that talks were not going well.  As reported by the unions, the release of the draft letter was unauthorized.  In a joint statement from SAG and AFTRA, the unions stated, “We are making every effort to negotiate a fair contract and remain optimistic that we will bring these talks to a successful conclusion. Today, there was an unauthorized distribution of a draft strike authorization letter. This is one of many contingency documents that we prepare in the course of any negotiations, particularly as we approach the expiration of a contract. Our members understand that this is a normal part of the bargaining process. We will continue to bargain in good faith with the industry in an effort to get a deal.”

As I reported earlier, the rumors that things are “grim,” as one reporter opined, could not be further from the truth.  Both sides continue to negotiate in good faith with every intention of avoiding labor disruption.  While there are serious issues on the table, those who are bargaining for both the unions and the industry continue to build on the positive relationship the two sides have developed since first embarking on the joint study on performer compensation the two sides commissioned from Booz & Company in 2006.

Nor is the JPC concerned that the unions may be drafting potential notices to their members.  Doing so, as the unions reported, is a normal part of the process and no different than the JPC’s preparation of draft notices to authorizers should developments require alternative planning.

Update on the Status of Negotiations

Based upon some recent press reports, it is apparent that there is confusion as to the status of the JPC's talks with SAG and AFTRA over the commercials contract.  Contrary to reports, the talks are not at a standstill nor are they contentious or nerve wracking.  In truth, the two sides continue to strive for a solution and are working together to find common interests on which agreements can be made.  And while there are certainly some sensitive issues relating to compensation models, pension and health fund issues, and other areas, progress has been made every day we've met.  Perhaps the hiatus we took off from negotiations this past week created the illusion that we're not moving to a solution.  Such a conclusion is simply incorrect.

While one can never count out the prospect of an impasse despite the best intentions of both sides, I have no reason today to believe that we are on a path that will lead to such a result.  Rather, the two sides are actively discussing the pros and cons of the models proposed by Booz & Company in the joint study undertaken by the JPC and the unions.  We're also exploring ways to keep production in the United States and to address JPC and union concerns in a variety of areas.  Between the proposals put on the table by the JPC and unions, we're looking at just over 60 proposals.  We've resolved many of them and are fast getting down to those that have the most economic impact.  And while the negotiations will certainly be robust and perhaps even tense at times, both sides are professional and courteous and fully understand and appreciate that it will be in no one’s best interest to reach an impasse or live through another strike.

So I and the JPC remain cautiously optimistic and while we logically advise authorizers to prepare for the worst, we do not at this point believe the worst will happen.  Should our viewpoint change, we will immediately notify the industry via this blog and in the media.  Of course, if you have any questions in the meantime, feel free to contact me at dwood@reedsmith.com.