Writers Ink Tentative Deal to Avert Strike

The Writers Guild of America reached a tentative contract with film studios and television networks on Friday that could save Hollywood from a frightening work stoppage this summer. If the 11,500 members of the writers' union ratify the agreement, the deal will bring them a $41 million pay increase over three years.

That may mean good things for the two unions representing the film industry's 135,000 actors, who are poised to renegotiate their contract as early as May 10. The labor contract for both the Screen Actors Guild and the American Federation of Television and Radio Artists expires July 1.

But the writers, who were seeking greater creative control and more respect in the production process, did not win the elimination of the so-called "possessory" credit (like the "a film by" credit) that is often given to directors for movies.

Minimum salary levels, which are earned by about 25 percent of the guild's working members, are set to increase. The deal, which still must be approved by the governing boards of the union's East and West Coast branches and ratified in a vote by members, was a tough one to make.

The studios' chief negotiator, Nick Counter, called the talks "the most difficult negotiations we've had in many years." However, the pact was unanimously endorsed by the studios, Counter noted to Reuters.

The agreement came two days after the previous WGA contract expired, but negotiators had been bargaining intensely since then, under pressure from all who depend on the Los Angeles film industry for a livelihood. Writers did not gain an increase in video and DVD residuals, but they will receive a one-time fee of $5,000 per film to compensate them for distribution.

In a key gain for the union, writers would receive a new residual for movies and TV programs made available for streaming or downloading over the Internet. That fee, amounting to 1.2 percent of what online exhibitors pay for the material, covers new productions and existing catalogs dating back to 1971.

Another highlight of the new agreement would end the discount the Fox television network currently enjoys in the residuals it pays for reruns, bringing Fox in line with the bigger networks (ABC, CBS, and NBC).

The settlement news is a relief to Southern California. Los Angeles Mayor Richard Riordan recently released a private study estimating that 130,000 jobs and billions of dollars could be lost if the writers and actors went on strike.

Reuters contributed to this story.