George Clooney, Ben Affleck, Scarlett Johansson and a group of other A-listers presented a proposal to SAG-AFTRA leadership on Tuesday that they hope will help end the 98-day actors’ strike.
But the proposal was rejected on Wednesday by the union’s negotiating team, which stuck to the demands it had voiced in weeks of negotiations.
It helps to dig deeper into the proposition to understand why.
There are two main components: an increase in dues on higher-paid actors and a shift in balances to ensure lower-paid actors get paid first.
Increase in dues
Under current rules, SAG-AFTRA members pay $231.96 in basic dues each year, plus 1.575% of earnings up to $1 million. The A-listers’ proposal would remove that cap and make all actors’ income subject to a 1.575% assessment.
Clooney makes an estimated $50 million a year. (That would mean actors earning $3.2 billion a year over the cap, which equates to an average of $21 million a year for 160 actors, a reach.)
More to the point, the main problem here is that the SAG-AFTRA strike is not about dues. SAG-AFTRA is on strike to increase actors’ earnings, not to increase union funding. The two things are not interchangeable. Rising union dues have left studios unable to cover payments to actors or actresses’ pension and health funds.
Dues are also irrelevant to the collective bargaining process because they are not subject to negotiation between the union and the Alliance of Motion Picture and Television Producers. They are set up by the SAG-AFTRA National Board, which must go through a separate process that involves selling high-earning actors on the idea of paying more to the union.
While SAG-AFTRA finds a use for the extra money, the union has not been affected by the decline in dues. The union reported receiving $127 million last fiscal year, a significant increase from the previous year, as production returned to pre-pandemic levels.
Fran Drescher, president of SAG-AFTRA, explained that dues cannot be used to fund pension and health plans. Instagram video Released on Thursday night.
“It’s kind of apples and oranges,” he explained. And increasing the dues, he said, “doesn’t affect the contract we are striking for.”
A ‘bottom-up’ residual system
The group also proposes a residual structure where the lowest-earning actors would be paid first, and the highest earners would receive what was left last.
This appears to confuse residuals with profit participation. A-list actors can negotiate a percentage of profits, which are then paid to the backend in a “waterfall” system. As more profits come in, the money starts to flow further down, so positioning an actor in the waterfall makes a big difference.
That’s not how residuals work. The rest will be given to all who need them at once. Every time a program is sold to a new media outlet or rebroadcast on TV, union contracts spell out exactly who has to pay what. The rest have nothing to do with profit. There is no “waterfall,” and it doesn’t matter where an actor is.
Drescher also mentioned the rest of the project in his Instagram video.
“It was vetted by our very experienced union contract staff, negotiators and lawyers, and they said it unfortunately doesn’t hold water,” he said. “Obviously it’s a very sophisticated house of cards.”
In other words, these two schemes do not address the issues that kept the actors on strike for 98 days. Those issues: a union proposal to give actors a share of streaming revenue, minimum raises to keep pace with inflation and restrictions on artificial intelligence.
These proposals seem motivated by a genuine desire to end the strike. noble dutyIt suggests that high-earning actors must make sacrifices to achieve that resolution.
However, from the standpoint of the SAG-AFTRA negotiating team, the proposal appears to weaken the sense of unity and commitment to the group’s proposals — which are critical to reaching a better deal. It also suggests that high-earning actors somehow come forward to pay for things that studios refuse to pay for — thereby reducing the pressure on studios to pay the pony.
Asked what the A-list actors could do to reach a settlement, a source close to the talks suggested joining the picket line.
