2020 MBA Contract Changes FAQ Dashboard Dashboard

1. What are the minimum increases?

Most minimums increase 1.5% in the first year of the contract, 3% in the second year and 3% in the third year. There are a few exceptions—certain minimums and residual bases increase by a smaller amount, and the residual base for network primetime reruns will remain frozen for the term of the 2020 contract. In addition, if the Guild chooses to exercise its right to increase pension contributions, the increases for most minimums in the second and third years of the MBA will be reduced to 2.5% and 2.25%, respectively.

2. Are the year one minimum increases retroactive?

Yes, the companies have agreed that the minimum increases for year one are retroactive to May 2, 2020. If you have been working during this time at Guild minimum, your fees should be increased by 1.5%. This applies to scripts written at Guild minimum as well as weekly pay. Please contact the Contracts Department if you have questions.

3. When are the retroactive payments due?

Retroactive compensation for writing employment or purchases that have taken place since May 2, 2020 will be due upon ratification of the contract by the WGA membership at the end of this month, July 2020. Please contact the Contracts Department if you have questions.

4. What is the pension increase?

Retroactive to May 2, 2020, the pension contribution rate will increase a full 1.5%, to 10.0% for nearly all work (it will increase a full 1.5% to 8.5% for pilots and the first season of one-hour episodic series). We estimate this will add approximately $27 million in additional contributions to the plan in the first year.

The Guild also negotiated the right to divert additional money from minimum increases in the second and third years of the MBA, in order to further shore up our defined benefit retirement plan. On May 2, 2021, the Guild can increase the pension contribution rate to 10.5% by diverting 0.5% from certain minimum increases. On May 2, 2022, the Guild can increase the rate once again to 11.25% by diverting an additional 0.75% from certain minimums and 0.25% from other minimums.

5. Why are diversions from minimums to pension so important and difficult to achieve?

While the pension rate increases are diverted from minimums, it is also true that with many screen and television writers working above scale, minimum increases have less of an effect on writer pay than do benefit contributions. Stated another way, a greater portion of writers’ earnings are subject to benefit contributions than are subject to minimum increases. For example, we estimate that a 1% increase in minimums generates an additional $6 million in pay for writers. In contrast, a 1% increase in the pension contribution rate generates almost $18 million in contributions. As a result, forgoing certain minimum increases, but increasing the pension contribution rate, is a significant and favorable gain. That’s why the 2.75% increase to the pension rate is such a significant achievement, and one the AMPTP companies vigorously resisted until the contract deadline.

In total, the Guild secured the right to increase the pension contribution rate by 2.75% during this MBA. Over the course of the 2020 MBA alone, we project these increases to the pension rate to result in an additional $117 million in contributions to the plan, which is 40% more than if the Guild accepted the pattern pension increase of only 2% over the three-year contract. The Pension Plan’s actuaries tell us this additional funding will help protect the plan’s long-term financial stability and its ability to fund writers’ defined benefits in retirement. While the increases in the contribution rate do not result in increases in individual writer pension benefits, the added contributions ensure that our industry-leading retirement benefits are appropriately funded. Other plans have faced conversion to 401k-style plans where the benefit is no longer guaranteed. Our priority in securing the funding of our pension is a considered and, in your leadership’s judgment, wise choice aligned with the long tradition of union pension plans.

6. How does the paid parental benefit work?

For the first time ever, writers who qualify for Guild health insurance will be able to get a paid parental benefit to assist them with the birth of a new child, the adoption of a new child, or the placement of a foster child. This benefit will be funded by a new employer contribution of 0.5% of writers’ earnings, paid in the same manner as contributions to the Pension Plan and Health Fund.

We estimate the 0.5% contribution will generate approximately $9 million annually. To adequately fund the benefit, we agreed that paid parental benefit will become available starting May 2, 2021.

The benefit is designed for a freelance workforce, allowing screenwriters and other non-staff writers to receive it, as well as those on a TV series staff. The new benefits will be coordinated with state benefits, such as California’s Paid Family Leave benefit. The program will be administered by the trustees of the Health Fund and details of the benefits will be finalized in the coming months. The fact that it is portable—not tied to a particular employer—may be a first in any industry in the U.S. and something only a multi-employer union contract can achieve.

7. What are the residual improvements in HBSVOD?

HBSVOD residuals for new series and feature length programs licensed and written after May 2, 2020 were improved in three ways:

• First, the residual bases used to calculate the annual HBSVOD residual payments, which have not increased in three years, will increase 7.5% effective May 2, 2020. The residual bases will increase another 7.5% effective May 2, 2021:

Story & Teleplay Residual Base	2017 MBA	2020 MBA Year 1	2020 MBA Years 2 and 3
30 minute episode	$14,119	$15,178	$16,316
60 minute episode	$25,663	$27,588	$29,657
Feature-length (96 minutes +)	$50,541	$54,332	$58,407

• Second, the annual domestic reuse payments (which are calculated as a percentage of the residual base) for the first three years of reuse of a program on the SVOD platform will increase, as shown in the table below:

Exhibition Year	2017 MBA Percentage of Residual Base	2020 MBA Percentage of Residual Base
Year 1	35%	45%
Year 2	30%	40%
Year 3	30%	35%

• Third, the annual foreign SVOD reuse payments are now fixed at 35% of the domestic payment in perpetuity (previously, the percentage decreased after the third year of reuse):

The result is that residuals will significantly increase across SVOD platforms. The tables below provide examples of these residual improvements for various platforms by calculating a total for three years of reuse inclusive of both year one and year two 7.5% increases to the residual base. Programs written on or after May 2, 2021 will receive these residuals, which represent a 46% increase compared to 2017 residual payments:

Half-Hour Episode Residuals—Three Year Total
Platform	Current Domestic Subscriber Tier	2017 MBA Residuals	2020 MBA Residuals	Gain
Netflix	45 million+	$27,161	$39,648	+$12,487
Amazon	20-45 million	$18,108	$26,432	+$8,324
Hulu1	20-45 million	$13,413	$19,579	+$6,166
Apple TV+	5-20 million	$11,770	$17,181	+$5,411

One-Hour Episode Residuals—Three Year Total
Platform	Current Domestic Subscriber Tier	2017 MBA Residuals	2020 MBA Residuals	Gain
Netflix	45 million+	$49,369	$72,067	+$22,698
Amazon	20-45 million	$32,913	$48,044	+$15,131
Hulu	20-45 million	$24,380	$35,588	+$11,208
Apple TV+	5-20 million	$21,393	$31,229	+$9,836

Feature-Length Program (96 minutes+) Residuals—Three Year Total
Platform	Current Domestic Subscriber Tier	2017 MBA Residuals	2020 MBA Residuals	Gain
Netflix	45 million+	$97,228	$141,929	+$44,701
Amazon	20-45 million	$64,819	$94,619	+$29,800
Hulu	20-45 million	$48,014	$70,088	+$22,074
Apple TV+	5-20 million	$42,132	$61,503	+$19,371

8. Will the improved terms apply to all HBSVOD programs?

Beginning with the 2014 MBA, when the Guild negotiated improvements to initial compensation and residuals for high budget SVOD (HBSVOD) programs, the companies limited the application of these improved terms to new series licensed and written during the term of the 2014 MBA. If a program had already been licensed or written prior to the 2014 MBA, it did not benefit from the improvements, even for new seasons that were written after the 2014 MBA took effect. This concept was maintained under the 2017 MBA.

During the second year of the contract, this exemption from improved terms will be eliminated for most HBSVOD series that were licensed prior to the 2020 MBA. Specifically, seasons of these “exempt” HBSVOD series that begin filming in July of 2021 will benefit from the improved residuals negotiated in the 2020 MBA. However, HBSVOD series that were originally licensed during the 2014 MBA will continue to be exempt from the improved residuals and writers on those programs will be paid under the residual formula in the 2014 MBA. If you are working on an ongoing HBSVOD series and have questions about how these changes affect your series, please contact the Contracts Department.

9. What about lower budget SVOD shows?

In the new MBA, writers working on new SVOD shows at lower budget breaks will be guaranteed minimum script fees, Article 13 and 14 weekly minimums, and improved HBSVOD residuals. The “high budget” break for new half-hour series is $1 million (down from $1.3 million), and for new one-hour series it is $1.7 million (down from $2.5 million). The higher SVOD budget breaks ($2.1 million for half-hour programs and $3.8 million for one-hour programs)—where writers are paid network primetime script fees—were unchanged.

10. I am currently on a low budget SVOD show; what happens to me?

The newly lowered SVOD budget breaks apply only to new series licensed after August 2, 2020. Consequently, if you are working on an ongoing low budget SVOD show, the lower budget breaks will likely not apply. If the budget of your series continues to rise and ultimately exceeds the prior thresholds ($1.3 million for a half-hour series, $2.5 million for a one-hour series), high-budget SVOD terms will apply. If you have questions about work on a low budget SVOD series, please contact the Contracts Department.

11. SVOD Platform Subscriber Tiers—what are they and why are they important?

An SVOD platform’s “subscriber tier” determines the script fees and residuals that apply to a writer’s employment in two ways: first, a platform with 20 million or more subscribers must pay network prime time script fees for programs at the highest budget levels ($2.1 million or more for half-hours, $3.8 million or more for one-hours); second, a platform’s number of subscribers directly impacts the residuals that must be paid to the writer (i.e., a platform with more subscribers must pay more in residuals for each year of reuse).

The subscriber tier for each SVOD service is assessed annually on July 1st. Information on the current subscriber tier for Netflix, Hulu, Disney+ and CBS All Access will be available soon. In addition, during 2020 negotiations, the Guild and the companies agreed to place certain platforms (both new and existing) into a specified tier for the first year of the contract:

• Amazon Prime will be placed in the 20 to 45 million SVOD subscriber tier
• AppleTV+ will be placed in the 5 to 20 million SVOD subscriber tier range
• Peacock will be placed in the 1 to 5 million SVOD subscriber tier range
• HBO Max will be placed in the 5 to 20 million SVOD subscriber tier range

All SVOD subscriber tier placements will be reassessed on July 1, 2021.

12. What were the new writer discounts and why were they eliminated?

The new writer discounts were reductions to minimum screen and television rates that could be used to employ writers who had not previously worked under the MBA. For new screenwriters, the contract allowed for a 25% discount on their first screenplay or weekly employment of up to 14 weeks. For new television writers, the rates were discounted between 20% to 40% for up to the first 14 weeks of employment. The Guild sought to eliminate the discounts because they undercut MBA minimums and had disproportionately applied to underrepresented groups.

13. What was the trainee wage rate and why was it eliminated?

For decades, the MBA allowed companies to establish training programs under which writers from underrepresented groups who had not previously worked under an MBA could be employed at a steeply discounted trainee wage rate. The Guild succeeded in eliminating this program, which resulted in lower compensation to writers from underrepresented groups.

14. What improvements were made to the Span provision?

The span provision in Article 14.K.2., which says that a TV writer-producer’s episodic fee can cover only 2.4 weeks per episode on short order series (14 or fewer episodes for streaming and basic cable, 12 or fewer on broadcast)—will now apply to writers earning less than $400,000 ($375,000 for basic cable series employment). This change will apply to contracts entered into on or after August 2, 2020, and is an increase from the current earnings cap of $350,000. Please note that if you are working under a deal from prior to August 2, 2020—including options exercised under that prior deal—the $350,000 cap continues to apply to your employment.

In addition, for contracts entered into on or after May 2, 2021, a company may not make additional payments to a writer for the sole purpose of “exempting” the writer from span protections.

15. What improvements were made to Options & Exclusivity?

The 2020 MBA improves existing options & exclusivity protections (MBA Article 67) in a number of ways:

• Previously, companies were allowed to negotiate a 90-day first position hold on a writer between seasons. That unpaid hold period is now shortened to 60 days, after which the company must pay to hold the writer in first position or the writer is free to find another job.
• For contracts made on or after May 2, 2021, the earnings cap under which the options and exclusivity provisions apply will be increased from $280,500 to $325,000 for non-children’s series, meaning more writers will be protected by these improved terms.
• The 2020 MBA also includes new protections for writers working for short periods (e.g., “mini-rooms”). Beginning with contracts made on or after August 2, 2020, a company may not negotiate an option and hold a writer employed for eight weeks or less, unless the option is for employment that starts immediately after the initial period of employment. Writers who earn more than $280,500 ($325,000 for contracts on or after May 2, 2021) in the first employment period of eight weeks or less would be exempt from the new provision.

16. What is the syndication rollback?

Programs licensed for reuse in the broadcast syndication market after July 1, 2020 will pay a residual of 2% of the license fee instead of the prior fixed residual formula. This will likely result in markedly lower residual payments for reuse in the broadcast syndication market. However, programs already licensed for broadcast syndication will continue to pay fixed residuals under existing license agreements, as well as any optional renewals or extensions.

¹Hulu is only a domestic service, the residual payments are for domestic reuse.

Read a summary of the 2020 MBA.

If you have questions, contact the Contracts Department.