In the final days of the SAG-AFTRA contract negotiations, when pressure was closing in on the guild to end what had been a crippling, nearly six month work stoppage, union president Fran Drescher was holding onto an unusual demand, one that most guild members knew nothing about.
Drescher wanted a fund over which SAG had broad discretion to redistribute money among its members. “She wanted her Robin Hood fund,” one studio source says.
SAG’s tentative agreement with the AMPTP includes the unorthodox new streaming fund, which is designed to share the wealth among more actors — even those who aren’t working on the shows and films that generated it.
The fund’s unusual structure has raised questions for guild members and studios about fairness, legality and the principle that Hollywood is a business that rewards success.
“What if I’m in a show on Netflix and I didn’t get what I should because [SAG] is redistributing the wealth?” asks the studio side source. “It’s problematic for SAG, for agents, for actors.”
In an effort to close the deal amid a 118-day strike that had been grueling for both sides, SAG and the studios agreed to create the fund while essentially punting on figuring out the finer details. The broad strokes are this: High-budget streaming shows that attract 20 percent of a platform’s subscriber base in the first 90 days will generate a bonus, which SAG estimates will amount to about $120 million over the 3-year term of the contract. Of that bonus, 75 percent will go to the actors on those shows and 25 percent will go to a fund to be jointly administered by SAG and the AMPTP. According to SAG chief negotiator Duncan Crabtree-Ireland, recipients of the fund, “will be limited to people who are working in streaming. It’s not meant to broaden beyond that.” None of the money, Crabtree-Ireland says, will go to union officials.
Drescher pushed for the fund as a way to help mitigate the impact of the streaming business model on actors whose shows don’t become big enough hits to reach the bonus benchmark. “They deserve to make more money without question because those shows in linear TV would’ve been into syndication and there is no syndication in streaming,” Drescher told The Hollywood Reporter. When studios pushed back, wanting the fund to be limited to actors whose shows and films triggered the bonus, Drescher insisted that wouldn’t be a “wide enough tent” to help SAG’s members, according to a source with knowledge of the negotiations.
Of those members, only a fraction actually make a living as actors — just 14 percent, or 22,400 SAG members make at least the $26,470 a year required to qualify for guild healthcare coverage. Among those who do make their living as actors, there is some frustration about so many nonprofessionals having a say over their livelihoods. “A fundamental question is, ‘Why is it appropriate to have 130,000 members who don’t work vote to support the union in re-allocating the money generated by the 30,000 who do?” asked one guild member.
During negotiations, Drescher fought hard for the fund, particularly as it was becoming clear that SAG’s revenue sharing proposal was a non-starter with studios. Part of the role that the A-listers — particularly Ben Affleck — were playing behind the scenes during the strike was trying to find a model for streaming compensation that both SAG and the studios would agree to. “Ben came in with a different view and different formula that we didn’t use, but it opened up conversations with SAG,” says a studio-side source. “Once he got involved and some of the other actors got involved, he was trying to come up with practical solutions.”
In exchange for giving up on revenue sharing in favor of a streaming fund, however, Drescher wanted SAG to have complete discretion over how that fund would be dispersed. It’s a key difference from the WGA deal, in which the streaming bonus goes to the writers whose shows triggered it, and it’s a model that multiple attorneys familiar with such contracts have called highly unusual. Crabtree-Ireland notes that there are some precedents in previous SAG contracts, including funds created to redistribute money among performers whose work is used in streamed music and in commercials.
The fund’s structure is new enough in film and television, however, that at one point during the SAG deal negotiations, studios were concerned it might violate Section 302 of the Labor Management Relations Act, an anti-bribery statute that prohibits employers from paying money to union members or officials. By the time the deal closed, AMPTP lawyers were sufficiently comfortable that the deal was on firm legal ground, according to both guild and studio sources, because the money is earmarked for performers working in streaming. “[The legality of the fund] is a topic that they raised with us and we certainly discussed it,” says SAG Chief Negotiator Duncan Crabtree-Ireland. “But I think that those concerns have largely been resolved.”
But given a history of what some SAG members consider to be dysfunction in their union, some are wary of the new fund and the lack of information about who exactly the money will go to. Performers in streaming is a still broad category, and one that gives SAG officials significant leeway in handing out cash. “The very laws it flirts with breaking were expressly intended to protect union members from exploitation by their representatives in union leadership,” says one guild member. Crabtree-Ireland says SAG’s contract negotiating committee will formulate a set of recommendations about how the money should be distributed, and give them to the fund’s trustees.
Some industry sources also worry that actors with hit shows may sue SAG over lost compensation, while studios fear that the actors whose work generates the money in the fund may feel underpaid and come back to them asking for more.
In the final days of talks, control over the fund, along with AI protections, was a main sticking point in closing a deal. The studios negotiated SAG’s discretionary portion down to 50 percent and then 25 percent, where it landed.
While agreeing to the fund enabled studios to finally close the deal, it rankled some of them. Says another studio source, “We’re against this socialism. Why should people get bonuses on shows that didn’t work at all?”
Crabtree-Ireland pushes back at that characterization. “It’s not socialist,” he says. “It’s a little bit less elitist. And I think that’s OK.”
Katie Kilkenney and Kim Masters contributed to this report.
Nov. 13, 4:21 pm PST. This story has been updated to include additional comments from Crabtree-Ireland.