IATSE/AMPTP Deal: 2% Wage Increases and First-Time Ever Health Premiums

1:45 PM PST 04/13/2012 by Jonathan Handel

Addressing a multi-hundred million dollar pension and health funding shortfall required instituting premiums for dependents and increasing the studio contribution to the health plan.

IATSE and the Alliance of Motion Picture and Television Producers have reached a new three-year deal, well in advance of the July 31 expiration of the current contract. Key terms include 2 percent annual wage increases and preservation of health benefits – achieved by compromise from each side.

For the first time, the Motion Picture Industry Health Plan will charge premiums for members with dependents: $25 a month for one dependent and $50 a month for members with two or more dependents. There’s still no premium required for members without dependents.

“Our goals going into these negotiations have been met,” said IATSE president Matt Loeb. The negotiations “resulted in a fair deal that will provide employment stability, protect our health and pension plans and provide for wage increases in a fragile economy,” he added.

The pension and health plan was facing a funding shortfall that Loeb estimated at “over $400 million.” Another source, speaking on background, gave The Hollywood Reporter a $350 million forecast over the next three years. Both figures were an improvement from the plan’s $500 million estimate six months ago but were still substantial.

“We understand how important health and pension benefits are to Hollywood crew members and their families and the risk posed by the projected shortfall in funding those benefits,” the AMPTP said. “We worked diligently with IATSE to resolve the funding crisis and keep these plans financially sound and a vital resource for participants.”

According to Loeb, the studios agreed to a $1-an-hour increase in the health plan contribution rate, which he described as a 20 percent increase over the current rate of $5 per hour. Those contributions, which employers pay in addition to wage, are part of the way the pension and health plans are funded.

In addition, some funding ($0.305 an hour, or 30.5 cents) that employers contribute to one of the retirement plans – the Individual Account Plan – will be reallocated to the health plan. The effect of this on the IAP could not immediately be determined.

Loeb’s statement said that the deal also included a “studio zone” expansion sought by producers, matching changes made by other unions. Certain union terms are lower in the Los Angeles studio zone, which is a 30-mile circle centered at the intersection of Beverly and La Cienega Blvds., plus certain other territory such as the old Columbia and Disney Ranches. The most recent SAG/AFTRA deal, negotiated in fall 2010, added a number of additional outlying areas as well: Agua Dulce, Castaic (including Lake Castaic), Leo Carillo State Beach, Moorpark, Ontario International Airport, Piru and Pomona (including the Los Angeles County Fairgrounds).

Loeb also said “Productions made for home video will be budget based and we agreed to confirm our long standing practice of promoting basic cable TV production in Los Angeles.”

Even with the new premiums, the MPI Health Plan is unusually robust: For instance, under the Blue Shield option, there are no deductibles; low co-pays ($5 a visit in some cases); 100 percent coverage of some doctor visits; 90 percent coverage of hospital visits and a $1,000-per-person annual maximum for out-of-pocket costs. None of the above-the-line union or guild plans is this robust; nor are nonunion health plans generally anywhere near this vigorous.

The plan was even better prior to August 1, 2009. The plan trustees can change these details at any time.

The negotiations began March 7. Further details are expected to be released in the future. The deal will be sent to members for ratification once contract language is drafted. The timetable for that is not known.

Negotiations with the Teamsters and unions representing plumbers, plasterers, electricians and laborers are incomplete and will resume at a date to be determined.

Bookmark THR’s Labor Page for the most in-depth coverage of entertainment unions and guilds.

E-mail: jhandel@att.net

Twitter: @jhandel

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