It’s a Deal: SAG-AFTRA Ratifies New Commercials Contract

Advertising Law

The Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) members overwhelmingly voted to ratify the 2019 SAG-AFTRA Commercials Contract, which was finalized by SAG-AFTRA and the Joint Policy Committee (JPC) on April 2, 2019, following months of negotiations.

The new agreement, which is effective retroactively from April 1, 2019, through March 31, 2022, features several major changes, including the following:

1. For each commercial, the JPC authorizer has the option of applying a new alternate compensation structure (ACS) instead of the main contract, with three different flat-fee options: Full Bundle, Made for Digital Bundle and A la Carte Bundle. The JPC authorizer must make the election for each commercial, and the selected compensation structure will apply to the entire cast of the commercial for the maximum period of use (MPU). The ACS is available for productions after June 1, 2019, and will sunset on March 31, 2022.

  • The Full Bundle (or “Upfront Plus”) requires a session fee plus payments of $20,000 per on-camera principal and $15,000 per off-camera principal, and permits one year of use from the earlier of the first use or 13 weeks following the first production day. It also includes up to ten Class A uses and unlimited use in all other media.
  • The Made for Digital and OTT Bundle (or “Digital Upfront”) requires a session fee plus $3,825 per on-camera principal and $2,868 per off-camera principal, and provides for one year of unlimited use on Internet, new media and over-the-top (OTT) platforms.
  • For a more flexible option, the A la Carte Bundle (or “Upfront Flex”) requires guarantees of $8,000 per on-camera principal and $6,000 per off-camera principal, on top of the session fee and varying rates for 13-week cycles of use for different formats (for example, $3,400 for all cable and local cable and $1,300 for all digital, including Internet, new media and OTT).

2. All contract rates for principal performers and extra performers increased by 6%, and the pension and health contributions were raised to 19% (from 18%, but JPC authorizers get a discounted rate of 18.5%).

3. Stunt coordinators and performers who use sign language to sign dialogue are considered to be principal performers.

4. Commercials posted on social media (excluding YouTube) may remain in the feed tied to their original dates following the expiration of the MPU without triggering additional payments, as long as they are not relevant to any current campaign and are removed at SAG-AFTRA’s request.

5. The maximum liability for use of a commercial beyond the MPU is fixed at double scale, calculated based on the duration of the authorized use, but not to exceed two years, provided that certain conditions are met (e.g., the unauthorized use occurred only on the advertiser’s or agency’s YouTube channel(s) and did not include any paid exhibition, and there was no linking to the commercial or embedding it on another website during the period of unauthorized use).

6. The Live Event, Man on the Street and Hidden Camera Commercials waivers are made permanent. Additionally, SAG-AFTRA agreed to consider requests from JPC authorizers for a waiver from the contract in the event of a hardship (e.g., potential loss of advertiser business by an authorizer agency).

To read the agreement, click here.

Why it matters: The 2019 Commercial Contract includes several significant changes that are designed to simplify and modernize the contract, and make it more relevant to the industry.