DGA Deal Details Revealed

The Memorandum of Agreement posted by the guild describes new residuals formulas and more.

The DGA has posted the details of the contract it ratified last month. The document, 47 pages of legalese that only a lawyer could love, lays out in contract language the gains that the DGA achieved in wages, residuals and other areas. The revisions in the document – which is termed a Memorandum of Agreement – take effect July 1, 2014.

Notably, the MOA sets out new wage minimums and residuals formulas for high-budget streaming-video-on-demand programs in the vein of Netflix’s House of Cards. Under the new deal, no residuals are payable for the first year an episode is available. In the second year, a residual of 30 percent of the network primetime residual base is payable, which equates to a residual of about $7,200 at current rates. The same amount is payable for year three, and then the percentages decline year by year, until year 13 and thereafter, where the rate plateaus at 1.5 percent of the network residual base.

Other gains detailed in the MOA include annual wage increases; increased residuals bases; improvements in basic cable; increased residuals in streaming media; the establishment of a formal diversity program at every major television studio; and improvements in theatrical and television creative rights.

Aspects of the MOA, such as the wage increases and residuals provisions, are likely to set a pattern that will be replicated by the WGA and SAG-AFTRA deals. The WGA is currently in negotiations with the studios (talks are paused until March 4) and SAG-AFTRA is preparing for its bargaining sessions, which are not yet scheduled.

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