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January 15th, 2013
Steps To Consider As SAG-AFTRA Contract Expiration Nears
Due to their merger last year, SAG-AFTRA will be bargaining these contracts as one union. Contract talks are scheduled to begin February 14, 2013, which doesn''t leave much time to resolve the major issues on the table: (a) increasing employer contributions to the applicable pension & health plans; (b) merging SAG''s p&h plan with AFTRA''s p&h plan; (c) unifying the SAG and AFTRA commercials contracts into uniform agreements; and (d) better defining what is a "commercial" in the internet/new media era. Off the table for now is the issue of revamping commercial residuals based on gross ratings points, as SAG-AFTRA and the industry are continuing to research the availability of more consistent data.
Although both sides are optimistic a deal will be reached, negotiations are likely to go down to the wire. So, what should brands and agencies be thinking about as the industry approaches its own "fiscal cliff"?:
- When possible, schedule your productions to begin and end prior to the March 31, 2013 deadline;
- Rate increases are likely to be part of a new deal. So, it may be wise to increase budgets for post-deadline productions;
- When negotiating with talent, directors, production companies and other vendors, carefully consider whether your "force majeure," suspension/extension and termination provisions adequately contemplate a potential work stoppage in each contract;
- Consider alternatives to SAG-AFTRA talent for campaigns that are not scheduled to begin until after the deadline. Do you have resources in place to help you find talent from the non-union talent pool? Does duplicate casting make sense?
- If the maximum period of use ("MPU") for a commercial you intend to keep using is likely to expire during a potential strike, consider negotiating to extend the MPU prior to the deadline; and
- Most of all, agencies and brands are going to want to get together early this year to discuss the doomsday scenarios and formulate contingency plans for each production.
If you have any questions about the state of negotiations, SAG-AFTRA or any other advertising or marketing law issues, please contact Jeffrey Greenbaum at 212.826.5525 or JGreenbaum@fkks.com; Brian Murphy at 212.826.5577 or BMurphy@fkks.com; Michael Schiffer at 212.705.4827 or MSchiffer@fkks.com; or any other member of the Frankfurt Kurnit Advertising Group.
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