Confounding expectations, the Director’s Guild told members last week that it would wait until “later this spring” to negotiate new TV and theatrical contracts, which expire June 30. “Later” most likely means the Writers Guild will negotiate first—its contract expires May 1—which increases the likelihood of a WGA strike. The writers are frustrated and united, as they showed in their successful 2018-2020 battle against the talent agencies and at a lively member meeting yesterday that attracted about 500 writers.

Will they strike? Predictions are fraught, but the negotiations will certainly be hard fought. In 2020, the pandemic undercut a walkout threat and, said WGA negotiating committee member Ashley Gable in her 2022 candidate statement, “our most critical issues were left unaddressed until [the 2023] negotiation.” 

What are those issues? The WGA declined to say, but members who attended yesterday’s meeting told Puck that wage increases and so-called mini rooms are key concerns. The guild is still formulating its “pattern of demands,” but I developed the following guide based on source interviews, past negotiations, 2020 emails from the guild to members, and the most recent WGA West board and East council candidate statements. Here are the likely theaters of war in advance of talks—and a possible walkout.

Basic Wage Increases: In the last round of triennial negotiations, the WGA received annual wage increases ranging from 1.5 percent to 3 percent. But with 2022’s 6.5 percent growth in consumer prices (and 7 percent the year before), the WGA could seek bumps as high as 15 percent or more in the first year of the new contract (inclusive of catchup payments) and 7 percent or so in years two and three. The guild could also push to index future increases to inflation. As the studios attempt a trifecta—building a profit model for streaming, managing the decline of linear TV, and divining the future of theater-going—substantial wage increases, even if justified by inflation, will be an awfully bitter pill.

And there’s more: in 2020, the guild sought to “substantially” raise minimums for screenwriters and require that streaming movies pay theatrical minimums rather than the lower TV scale—particularly since streaming movies already can pay lower residuals than their cinema counterparts. The precipitous decline of theatrical output since then will only heighten these concerns.

And still more: three years ago, the guild proposed TV “script parity”—standardizing teleplay minimums at the network prime time rate and eliminating lower rates that apply to other platforms and dayparts. The union also sought improvements for staff writers, who don’t get an episodic fee even if they write a script; for writing teams, which are paid the same as individual writers; and for writers of streaming standup and talk shows (“comedy-variety shows” in guild lingo), who are not protected by minimums. Some or all of these issues are likely to reappear.

Mini Rooms: Television mini rooms—small writers rooms that break short-season stories—are becoming the new normal. But Gable called them a “scourge,” and the guild said that “writers are being asked to break an entire season of story in rooms that meet for brief periods of time and pay them only [weekly] scale [and no] episodic fees.” Even many showrunners “find themselves forced to scale because their wages land outside of span protections,” said board and negotiating committee member Travis Donnelly in his candidate statement, referring to contract provisions established in 2017 that provide additional payments to some writer-producers if episodic work expands unreasonably.

Fewer writers, compressed timeframes and lower rates all represent significant savings to studios and streamers—and deny writers their due, said almost every aspirant to the WGAW board. It’s a scorched-earth issue. Said board candidate David Schulner, “Those first weeks in a writer’s room completely shape a series. And that’s worth far more than a weekly minimum.”

A related concern raised at yesterday’s member meeting: since mini rooms often close up shop before pre-production, the disconnect from physical production denies lower- and mid-level writers vital experience—including doing production rewrites and working in post—stunting their opportunities to advance. “Compound this with a rise in ‘director driven’ streaming shows,” said Robert H. Wolfe in his 2022 candidate’s statement, “and the power and authority of television writers is under significant threat.”

Minimums must increase, said the guild in 2020. Donnelly was more specific: “Every single writer working on an episodic rate must be protected by span. Every writer working on a weekly rate… must be protected by drastically higher minimums.” 

Added board member Eric Haywood in his statement, “lower- and mid-level writers [must be allowed] to remain with a show long enough to get that hands-on experience, even in cases where the writers’ room wraps before production begins.” The 1950 classic Sunset Boulevard could frame the writers’ message: We are big; it’s the rooms that got small. It’s not for me to use the dreaded word “dealbreaker,” but this will be a pitched battle. 

Residuals: Every above-the-line strike since the founding of the guilds about 90 years ago has centered on residuals. There are hundreds of different residuals formulas, with the rules determined largely by the medium a production was initially made for (theatrical, broadcast TV, premium cable, basic cable, streaming, etc.) and the medium it is being used or reused in (which can be the same as the initial medium or not). The residuals system can be visualized as a grid of about 100 different combinations of made-for and reuse media.

Today, of course, the most intense focus is on streaming. Residuals for originals on Netflix, Hulu and the rest are an annual sum payable as long as the episode or movie stays on the platform. The amount declines year by year and depends on the guild, the program length and the number of domestic subscribers a platform boasts. 

The platform’s global reach, increasingly important as U.S. growth stalls for Netflix and others, is not part of the metric; nor is the program’s success, unlike with the many other residual formulas that are based on license fees or transactional sales. So viewership is not a factor: Netflix’s smash hit Wednesday pays the same residuals as, say, The Midnights Club, which the platform canceled after one fleeting season. Also disregarded are such core metrics as subscriber attraction, retention or purchasing behavior. 

That third variable is uniquely vital to Amazon, as video attracts people to Prime, and Prime members spend more than non-Prime members do. “We get to monetize [subscription video] in a very unusual way,” Jeff Bezos once remarked. “When we win a Golden Globe, it helps us sell more shoes.” Not only that; thanks to big data, Amazon no doubt knows which shows drive sales of Nikes and which ones push Vans out the digital door, the better to target advertising to its members—and make programming decisions.

All of that riles the guilds, who see studios and tech billionaires building global empires powered by professional content but not sharing enough wealth for middle-class creatives to sustain careers. Angelina Burnett, a WGA West negotiating committee member and the top vote getter in the 2022 board elections, said in her candidate statement that residuals checks “are not the reliable life raft they once were.” Donnelly asserted that feature writers are “often getting a quarter of what they used to” and that television writers suffer too. 

“In this new era of streaming,” Donnelly wrote, “the [checks] are getting lighter and lighter.” (Aggregate residuals across all platforms, unions and recipients have actually grown about 5 percent per year over the last two decades according to available data and my modeling, but the number of residuals recipients may have outpaced that.)

Three years ago, the WGA sought a boost in the streaming residual (which was achieved) plus a tiered “viewing bonus” based on the number of streams a movie or episode achieved (which wasn’t). As streamers share more viewing data with showrunners and now advertisers, albeit parsimoniously, it will be harder to use opacity as a shield. “The companies must be forced to open the black box and share data with unions and profit participants,” said Burnett. “Will it take a strike? Almost certainly.”

And if there is a strike, the guild could demand a fundamental recalibration in streaming residuals to include global subs (which the companies would want to weight regionally to account for varying monthly fees) and a piece of the metrics that matter most: viewership, subscriber attraction and retention, purchasing behavior, awards bonuses (recall Bezos and the Globes) and more. But these enhancements are something cost-cutting studios and tech giants will be loath to give.

Pension & Health: The guild achieved outsize P&H increases the last two cycles and its pension plan reported itself in “good shape” last April. Given its other concerns, P&H might not be a sticking point for the WGA this time.

Options and Exclusivity: “Short orders and uncertain production schedules, both for series and pilots, have resulted in too many writers being held for extended periods of time, even after limited terms of employment,” said the guild in 2020. The union wanted to expand protections established in 2014 and 2017 to all TV writers. SAG-AFTRA made progress in this area with a legislative threat and an unusual mid-cycle negotiation last year, and as eight- or even six-episode seasons become routine, the WGA is likely to renew its demands.

Working Hours: Unlike other guild agreements, the WGA contract has no working hour protections. “Writers’ rooms that regularly run long hours with no limits are detrimental to all writers, and disproportionately impact those with families,” said the guild in 2020. The writers proposed a 12-hour minimum turnaround period for writers, matching the SAG-AFTRA “forced call” provisions (which also require a 56 hour weekend rest). Increased attention to work-life balance in the wake of the pandemic suggests this proposal will reappear.

Free Work: Numerous issues here, especially for screenwriters. For one, writers don’t get paid to pitch. That was acceptable to them when pitching meant a meeting and a one-page leave-behind. But now, said board member Raphael Bob-Waksberg, “a pitch for a movie is a detailed description of the entire fully-broken movie. [And in TV], we’re expected to pitch out season arcs that in the past would have been figured out with a full writers room.” 

Moreover, said WGA East council member Gina Gionfriddo, “writers are submitting to bake-offs in which they spend months developing I.P. they do not own in competition with other writers.” Screenwriters who are hired are often asked to do unpaid rewrites at the behest of the producer or star, a situation the guild said was exacerbated by “the proliferation” of one-step deals. And potentially in the offing, warned board candidate Van Robichaux last year: studios making uncompensated “algorithmic reuse” of scripts as input to generative AI systems like ChatGPT—an even hotter topic today in the wake of recent decisions by Microsoft and Google to integrate generative capabilities into their search engines.

Last time around, the guild demanded that companies pay for repeated pitches—every meeting after the first would trigger a payment—and guarantee a second step for screenwriters earning less than twice scale. Expect similar asks this time, and maybe an AI proposal too.

DEI: In 2020, in an effort somewhat parallel to the non-DEI information sharing requirements negotiated with agencies, the guild sought to require that studios and streamers report on writer meetings, deals made, and option and step pick-ups (and non pickups), in order for the WGA to attain transparency into diversity and access. With continued focus on DEI, this demand is likely to be renewed.

That’s a lot of tough issues driven by powerful forces on both sides. Will the writers strike? Said one seasoned labor observer to me recently, “Are you crazy? Of course they’ll strike.”

Jonathan Handel is an entertainment/technology attorney, author, executive and journalist. He regularly represents producers and others in their dealings with guilds, was previously outside counsel to SAG-AFTRA and was on the legal staff of the WGA in the early 1990s.