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SAG's Internal Rift Hampers Strike Settlement


Nearly six months into Hollywood's longest strike, the Screen Actors Guild is beset by internal woes that are undermining efforts to settle its dispute with the advertising industry.

As the union and the smaller American Federation of Television and Radio Artists resume talks today in New York with advertising-industry negotiators, some SAG leaders now acknowledge that the union's worst problems may well be found within its own walls.

A shift to a more militant leadership, a skeptical staff and conflicting agendas between hard-liners in the Los Angeles main office and the less confrontational AFTRA and New York membership are preventing a settlement. Adding to the disarray are the union's bloated board, an underfunded war chest and a membership diluted in recent years by the swelling ranks of extras.

SAG's inability to resolve this smaller, contained standoff makes a prolonged, widespread actors' strike more likely next year when the studios and television networks negotiate new contracts.

The lengthy ad-industry strike has paralyzed the commercial-production community in Los Angeles, costing the local economy an estimated $125 million in direct lost production. It also has eroded Hollywood's labor relations to their worst point in more than a decade.

"None of us had ever done this before," said national strike coordinator and commercial actor Gordon Drake. "We've had to learn on the fly."

The strike nearly ended last month, according to negotiators, when the two sides were within reach of an agreement on substantive financial issues. But talks imploded over a very small difference involving the size of an increase in pay for ads that run on cable TV and whether the actors' contract should include jurisdiction over commercials made to run over the Internet.

By the union's calculations, a paltry $18 million per year separates the actors from the advertisers over payments for ads that run on cable. The industry puts the amount at about $25 million.

Industry negotiator Ira Shepard expressed optimism that a deal can be reached soon. "We're ready to end this thing, as long as we can get something that protects the industry economically," he said.

Union's Bloated Bureaucracy

The biggest issue for actors--a demand by the ad industry to pay them a flat fee for commercials that air on broadcast networks instead of the more lucrative residuals they now receive--was resolved when the ad industry dropped the idea in the last round of negotiations.

The union's most intransigent problem is its unwieldy decision-making bureaucracy. SAG is governed by a staggering 105 board members, many of whom haven't acted in years, according to union leaders. The board is the butt of jokes by other Hollywood union officials, who say its meetings are akin to a gathering of the United Nations. By contrast, the Writers Guild of America has 19 directors, while the Directors Guild of America's board numbers 21.

This and other issues are addressed in a critical 4-inch-thick report by the Towers Perrin consulting firm. Union officials say the confidential report offers a blistering review of SAG's operations, including the finding that SAG has far too many unnecessary offices across the country in places such as Portland, Cleveland and Detroit. The report also said SAG is so bogged down in overhead that covering the typical member costs more than three times the minimum $100 annual dues.

In a clear sign that the union wasn't prepared for a prolonged strike, SAG took the labor action without a permanent war chest to help members cover their expenses while they are out of work. Though it is considered one of the basic requirements for any striking union, SAG allocated just $2 million from its treasury to aid strikers. Those funds eventually were supplemented with six-figure donations from such stars as Kevin Spacey, Helen Hunt, Harrison Ford, Nicolas Cage and Eddie Murphy.

"We've learned that in the future we have to have a strike fund so the industries take us seriously," Drake said.

The union also didn't anticipate the public apathy toward its strike. Officials now say the union should have made certain it at least lined up the support of the labor community before walking off the job. The union is working to patch up what have been historically poor relations with other Hollywood unions that resent SAG for failing to support them during disputes, SAG officials say.

The friction between the Los Angeles office and New York and AFTRA members was evident in the union's floundering efforts to launch more hardball tactics to increase pressure on advertisers.

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