SUMMARY OF THE BASIC AGREEMENT BETWEEN IATSE and AMPTP

Steven Poster
National President
IATSE Local 600
stevenasc@ipgla.com

December 4, 2008

Dear Local 600 Members,

We just got the go-ahead from the IATSE to release the following information, and, as promised, here is a brief summary of the negotiations between the IATSE and AMPTP. We are pleased that the IATSE has successfully completed these negotiations and will be putting this tentative deal out to members for ratification in the near future. If approved by the Membership, this new contract would be in effect for three years from August 1, 2009 through July 31, 2012.

As you will see, one of the accomplishments of these negotiations is that, despite the economic crisis, the Union was successful in preventing the Producers from requiring IATSE members to co-pay the cost of health insurance premiums for themselves or family members.

The agreement provides wage increases of 3% a year on a compounded basis and protects our pension plan in this very uncertain time. Under the contract the producers agreed to substantially increase their contributions into the health plan so that our benefits would remain the strongest in the industry.

The Union also succeeded in securing jurisdiction over New Media. This ground-breaking achievement also creates a new source of funding for our benefits plans, because residuals will be paid on productions released on new Media platforms as described in the summary.

Because of the rapidly increasing cost of healthcare and the deepening recession, the IATSE had to make some painful decisions in order to protect the benefit structure of the active and retiree health plans. Because of these rising costs, the tentative agreement includes some modifications in the plans and an increase in the number of hours a member needs to work in order to qualify for coverage. Beginning in the final year of the contract, this requirement will be increased from 300 to 400 hours over a six month period.

We do know that this 100-hour increase will be difficult for some of our members. This is all the more reason why we need to focus on calling in our jobs, particularly those that are non-IA. We must organize every kind of employment opportunity so that the Union can expand job possibilities for the membership. Your officers and I pledge to make this our major focus to ensure that not one of our brothers or sisters loses coverage.

We have to challenge ourselves to become a better union and to do that we have to do a better job of looking out for our Brothers and Sisters. It's our responsibility to help members qualify for the health plan. We can do this if we just take the time to check the Membership First service that appears on the Local 600 website and will be greatly improved with the new computer system.

Again, we would like to stress that this deal is tentative and the bullet points below do not represent the entire Agreement. We will provide more details and information as they become available from the IATSE and the AMPTP. Your questions and comments are always welcome.

Fraternally,

Steven Poster
National President



SUMMARY OF THE BASIC AGREEMENT BETWEEN IATSE and AMPTP


WAGES and INDIVIDUAL ACCOUNT PLANS (IAP)

Increase current wages 3% per year, in each year of the three-year Agreement. This is the best wage package since the 2000 negotiations.

The IAP percentage contribution of 6% will apply on all hours worked or guaranteed and employers will contribute additional money with each wage increase.


PENSION PLAN

Negotiated 13th and 14th check for current retirees in each year of the Agreement and eliminated the requirement which conditioned payment on a minimum of eight months reserves in the active health plan.

Protected pensions by bargaining for a funding plan that over time will mitigate the effect of the unfavorable investment climate and prevent reductions in our pensions.


HEALTH PLAN

Increased employer contributions into plan by $.35 per year for a total of $164 million over the life of the Agreement.

Won additional employer contributions of $.15 per hour when health plan reserves fall below 10 months for actives, and an additional $.15 if reserve levels fall below six months in active plan or eight months in retiree plan or on July 31, 2011, whichever is earlier. These contributions amount to an additional $35 million.

Maintained Bank of Hours maximum at 450.

Modifications in the Plans

Out of Network: Co-insurance paid by participants utilizing out-of-network hospital and professional services will be increased from 30% to 50% while allowances for the usual and customary charges for these services will be reduced from 85% to 70%.

In-Network Hospital and Professional out-of-pocket 10% with annual cap increased from $800 to $1000. For example, if your hospital and doctor's bills total $45,000, the maximum you have to pay is $1,000 for these bills.

Mandatory mail order maintenance prescription drug usage, with co-pays capped at 2.5 times retail. After two thirty-day prescriptions, participants utilizing maintenance drugs must purchase 90-day supplies of prescription drugs through Medco. By using Medco, you will save money. For example, if you are co-paying $20.00 a month for a prescription drug, under this new provision, rather than pay $60.00 over a three-month period, you would only pay $50.00 over the same period.

Full cost on "Brand" drugs when approved "Generic" is available. Member pays difference. (Medical appeals available).

All brand co-pays increased by $5.

Preferred "Brand" drug co-pay increased by $5. Retail "Generic" no change.

Discontinue coverage for these drugs with over-the-counter equivalent available - PPI's (Heartburn) and NSA (Antihistamines). (Medical appeals available).

Emergency Room co-pay of $100 (waived if admitted to hospital).

PPO office co-pay increased to $30 for those in the Motion Picture Television Fund (MPTF) area not using MPTF. MPTF to require $5 co-pay for Doctor's visits.

$100 co-pay for each hospital visit.

HMO (Kaiser, Healthnet, Oxford) office co-pay increased from $0 to $15.

Coordination of Benefits provisions are expanded to include prescription charges.

Eligibility requirement increased from 300 to 400 hours, effective August 2011. Because the Bank of Hours remains at a maximum of 450 hours, and Local 600 members on average have 409 hours in their "banks," members earning 300 hours should be able to qualify through August of 2013. (Local 600 will use this period of time to convince members to call in their non-union jobs so that we can utilize our organizing resources to help them qualify for health benefits).


NEW MEDIA

Original Programs Made for New Media

IATSE increased its jurisdiction to cover these New Media consistent with the DGA, WGA and AFTRA.

New Media production based on existing shows (derivatives) are covered under the Basic Agreement.

Original programs made for New Media over $15,000 per minute or $300,000 per episode or $500,000 per series are covered. Producers will pay full pension and health contributions.

On covered programs for original New Media rates and terms of employment are freely negotiable, except that union security, grievance and arbitration and no strike/no lockout provisions will apply. No mandatory staffing and full interchange of classifications will also apply.

Re-use of Programs Transmitted in New Media

Residuals: Producers agree to pay residuals on:

· Productions created for traditional markets (feature films and television programs) that are released into New Media platforms.

· Derivative and original New Media programs when released originally on consumer and free ad-supported markets and subsequently released to a consumer pay market for electronic pay-per-view or download to rent after a 26-week period.

· New Media programs released into Supplemental Markets, such as basic cable, pay television and home DVD.

IATSE has the right to inspect unredacted copies of all licenses, distribution and other agreements, etc. pertaining to New Media exploitation on a quarterly basis. The purpose of this section is to allow the IATSE to monitor and evaluate the growth of new Media.

All New Media provisions will "Sunset" at the end of the contract and will be re-negotiated.

UNLIKE MANY OTHER UNION MEMBERS IN THE INDUSTRY, IATSE MEMBERS WILL NOT BE REQUIRED TO PAY ANY HEALTH INSURANCE PREMIUMS FOR THEMSELVES OR FAMILY MEMBERS