When members of the Screen Actors Guild cast their ballots for president in the coming weeks, they will be voting for a leader who can best repair the damage inflicted on Hollywood's largest talent union over the last two years.
With 125,000 members, the 76-year-old SAG is still the mightiest union in Hollywood. But its clout has been diminished by internal bickering, a divided boardroom and a disastrous power struggle with a smaller union that represents actors as well as broadcast journalists, disc jockeys and recording artists.
SAG has become so weakened, in fact, that the union once led by Ronald Reagan and James Cagney may have to merge with the American Federation of Television and Radio Artists to maintain its leverage. The potential merger is a central issue in an election that will be decided by Sept. 24, when results from a mail-in vote now underway are announced.
The SAG election is one of two contests this fall that could set the course of industry labor relations over the next two years. The other is at the Writers Guild of America, West. Both elections pit candidates who advocate a hard line in negotiations with the studios against so-called moderates who favor a less confrontational approach with their employers and sister guilds. Although moderates are favored to win at SAG, the WGA race is much tighter.
Both unions' contracts expire in summer 2011, potentially giving the guilds power at the bargaining table if they can coordinate a strategy with the Directors Guild of America, which has set the pattern in bargaining in the past.
Relations between the major studios and the labor unions could not be more tense, after a 100-day strike by the WGA and a nasty contract dispute with SAG that dragged on for months and ultimately forced out Executive Director Doug Allen.
Among the most startling signs of SAG's weakened state is its grip over prime-time television. SAG's contracts cover only 16% of the new scripted prime-time TV shows on the major broadcast networks, down from 86% a year ago. When it appeared SAG might strike last year, the broadcast networks took their business to AFTRA, which now controls 84% of new prime-time shows. AFTRA suspended its longtime bargaining partnership with SAG last year after a dispute over turf, freeing the union to negotiate directly with the studios for prime-time TV contracts.
Although SAG continues to dominate prime-time TV, the shift of work to AFTRA is taking a toll, reducing contributions to the actors' health and pension plans and eroding union dues, which were already depressed because of last year's production slowdown.
The guild had a nearly $6-million deficit in fiscal 2009, which ended April 30, thanks to investment losses, a drop in member dues and excessive expenses. That included funds spent on a fruitless campaign to oppose AFTRA's contract because SAG's former negotiators felt it contained too many concessions and undercut their own negotiations.
The guild laid off 35 workers this year to balance its $60-million budget. Although it has more than $20 million in reserve, SAG has projected a $4-million deficit for fiscal 2010, people familiar with the guild's finances said.
SAG's decline comes as actors are having a tougher time finding work. Studios cut back production because of the sagging economics of the business, and networks have replaced more scripted programs with less expensive reality fare, game shows and talk shows. Actors have seen a steady slide in their income from residuals, the extra fees they get from reruns, as fewer shows repeat on the networks or are sold in syndication. Networks increasingly repeat shows on the Internet, where residuals are a fraction of those on network television, or on cable TV, where pay rates are lower.
AFTRA and SAG have tried to merge before. Attempts in 1999 and 2003 sputtered over issues of control. Whether they can heal the bad blood between them is an open question.
AFTRA President Roberta Reardon has reacted cautiously to the idea, saying SAG needs to sort out its internal disputes first. A first step would be to revive the "phase one" bargaining partnership, in which the unions jointly negotiate contracts terms, that was suspended last year.
The two unions have about 44,000 members in common, but they have very different cultures that could make a marriage difficult. SAG represents actors who also work in feature films, while AFTRA does not. Many of AFTRA's actors work in daytime television.
Nonetheless, merging the two unions is a central goal of a coalition of SAG moderates, backed by Tom Hanks, George Clooney and other celebrities, that won control of the board in election's last fall. The group, called Unite for Strength, led the ouster of Allen and installed a new negotiating team and Allen's replacement, David White, who has worked to improve relations with AFTRA.