Few people are aware that the union collective bargaining agreements that govern the employment of performers and musicians in commercials in traditional and non-traditional media are collectively the largest union agreements in the entertainment business. Under these agreements, advertisers pay union performers and musicians nearly $1 billion a year. In the collective bargaining process, the industry is represented by the ANA/4A's Joint Policy Committee for Broadcast Talent Relations (JPC), while actors in commercials are represented by the Screen Actors Guild (SAG) and the American Federation of Television and Radio Artists (AFTRA), and musicians who perform in commercials are represented by the American Federation of Musicians (AFofM).

In May of 2009, the membership of SAG and AFTRA ratified the new three-year television and radio commercials agreements, which was the culmination of two months of negotiations between the JPC, SAG and AFTRA. As part of the new agreement, the unions and the JPC have agreed to conduct a two-year multi-million dollar pilot project to test a new way to pay performers that represents fair compensation, but also provides advertisers with a measureable return on their investment. The pilot will test the GRP Payment Model developed by Booz & Company in a $1.4 million study previously commissioned by the JPC and the unions.

Negotiations with the AFofM will commence in October 2009.

Advertisers and advertising agencies can become signatories to the SAG, AFTRA and/or AFofM contracts either by authorizing the JPC to represent them in collective bargaining or by directly signing onto those contracts after they are negotiated by the JPC. While the vast majority of major advertisers and advertising agencies are represented by the JPC, this memorandum explains why it’s critically important that responsible advertisers and advertising agencies be a part of the bargaining process through the JPC as opposed to being direct signatories with the unions.

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