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IATSE/AMPTP Talks Recess to Wrestle with Pension & Health Data

MPIPHP Motion Picture Industry Pension & Health Plan Logo - H 201

The tough issue is how to deal with a $500 million funding shortfall in the P&H plan.

Contract talks between IATSE and the AMPTP have gone into recess, with resumption to occur at an unspecified date, according to a joint statement.

The statement noted that the parties “have not completed their negotiation for a new Hollywood Basic Agreement,” and added that “the parties need additional time to review data before resuming talks at a later time.”

That’s understood to be a reference is to data concerning the Motion Picture Industry Pension & Health Plans, which serves IATSE members, Teamsters and others – including, ironically, employees of the AMPTP itself.

That data is written in red ink, to the tune of $500 million. That’s the Plans’ estimated funding shortfall over the next three years, according to a statement by the Plans’ executive administrative director, David Wescoe, at a Sept. 24, 2011, IATSE town hall meeting.

The current contract doesn’t expire until July 31. If there’s no agreement by around mid-May, studios may be reluctant to began principal photography, because failure to complete photography by contract expiration makes productions vulnerable to a strike in the absence of a successor agreement.

The IATSE negotiations began on March 7 and focused first on issues of concern to the various Hollywood locals within IATSE, such as cinematographers, editors, and a host of other crew. Each local has its own union agreement addressing occupation-specific issues. Discussions then shifted to the P&H plan, until they recessed today.

The AMPTP will begin talks next week with a related group, the so-called basic crafts unions: the Teamsters union, and unions representing plumbers, plasterers, electricians and laborers. Those talks are set to last two weeks.

When IATSE talks resume, several issues may be in play: wages; studio contribution to the P&H plan; health plan eligibility; and other key aspects of the health plan design. All of them involve difficult tradeoffs: The union would like the studios to increase their contribution to the pension and health plan. The studio preference in return would be to reduce the level of annual wage increases. However, the “new normal” for those increases, at 2 percent, is low enough to create a psychological barrier to accepting anything lower still.

Health plan eligibility is based on credited hours – essentially, hours worked in a given six-month period. Members currently need 400 hours in order to receive coverage. That represents an increase from 300 hours that became effective August 21 of last year. The increase was agreed to in the 2008-2009 negotiations for the contract currently in effect.

The union said at the time that “the 400 hours issue was one of the most difficult and debated issues of these negotiations.” So it may be difficult to increase that number again so soon.

That leaves other aspects of the health plan. The details are technically up to the trustees, who are appointed on a 50-50 basis by management and labor, but given that negotiations last time around addressed one aspect of plan design – eligibility – it wouldn’t be surprising if the talks did so again.

This time, though, premiums, deductibles, co-pays and reimbursement rates could be on the table.

In those respects, the MPI Health Plan is unusually robust: for instance, under the Blue Shield option, there are no premiums for individuals, couples, or families with children; no deductibles; low co-pays ($5/visit in some cases); 100% coverage of some doctor visits; 90% coverage of hospital visits; and a $1,000/person annual maximum for out of pocket costs.

The plan was even better prior to August 1, 2009.

None of the above the line union or guild plans is this robust, and with a $500 million shortfall it’s hard to see how the MPI Health Plan can continue to be. Only time will tell, and until a deal is reached, the matter is subject to what the joint statement called “a formal news blackout.”

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Email: jhandel@att.net

Twitter: @jhandel