LOS ANGELES _ The Writers Guild of America and the major studios reached an agreement in principle on a proposed new contract, averting a showdown that many thought was inevitable before the coronavirus pandemic roiled Hollywood, said three people familiar with the negotiations who were not authorized to comment.
Negotiators came to a tentative agreement last night on terms, which will be voted on by the union's full negotiating committee today.
The proposed three-year agreement eliminates earnings caps that pushed writers on short order series from being paid to close to the minimum level, a major priority for the guild as more shows shift to short-season shows on streaming platforms, said one source.
The tentative deal also was expected to include improvements in minimum salaries and residuals for members working on original shows in addition to higher pay for work on short-order shows.
The union, which represents about 10,000 members, began negotiations via video conference on a proposed film and TV contract with the Alliance of Motion Picture and Television Producers on May 18.
The sides had agreed to extend the existing contract for two months to June 30 to allow more time for negotiations during the COVID-19 pandemic.
Earlier in the year, many had expected writers would go on strike because of rising frictions over pay. But the pandemic, which has forced studios and unions to collaborate on safety issues, has eased labor tensions and the WGA did not seek a strike authorization vote.
Representatives for the WGA and AMPTP declined to comment Wednesday on the status of the talks.
Bargaining got off to a fiery start when the WGA's lead negotiator, David Young, clashed with Carol Lombardini, the studios' chief negotiator, over a request to extend healthcare to members affected by the shutdown.
Among other demands, the union sought improvements to residual payments, which are a key part of writers' incomes, and a bigger share of the profits being harvested through streaming. They also wanted higher script fees and increased contributions to the union's health plan.
Viewership on streaming platforms in April and May grew 117% over the previous year, the WGA said. Global subscription streaming revenue more than doubled over the last four years to $37 billion in 2019 and is projected to reach $62 billion in 2023, it said.
The union proposed a tiered system of bonuses linked to the number of streams on subscription streaming platforms, so that as viewership grows, so do residual payments.
"We are seeking to significantly increase the foreign residual so that it accurately reflects the value of our work in the foreign market," the WGA told members, nothing companies like Netflix and Amazon have more international subscribers than domestic customers.
In June, SAG-AFTRA, the industry's biggest union, tentatively agreed to a new contract modeled on a similar agreement reached by the Directors Guild of America.
The union, representing about 160,000 performers, broadcasters and actors, estimated the value of the proposed three-year contract ?at $318 million. SAG-AFTRA members will begin voting on the contract this week.
