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Do you know whether you are getting contributions paid into the Pension and Health Plans for your development services?

The DGA Basic Agreement does not require that you be paid for your services in developing a property – that is a matter for individual negotiation. And even if you have negotiated for compensation in development from a signatory company, it is not automatic that Pension and Health contributions be paid.

Because of the amorphous nature of development, the Plans have agreed to accept contributions for directors’ development services only under circumstances that provide some assurance that the development and the directorial services are bona fide.

If you are a director with a bona fide development deal, you may be able to benefit significantly if you or your agent includes in those deals employer payment for pension and health plan contributions. Knowing the Plans’ rules for accepting contributions for development services can positively impact your Pension and Health Plan eligibility.

The Plans will accept development contributions for directors performing development services for theatrical or long-form television production if each of the following conditions is met:

  1. A deal memo must be filed with the DGA at or before the time the work was performed. The deal memo must state the amount of compensation that is being paid for development services; and
  2. A deal memo, personal services contract, or other written agreement between the producer and the director entered into at or before the time the work was performed must provide that contributions are to be paid to the Plans in connection with the compensation paid to the director development services; and
  3. The director must have been actually paid for bona fide development services, which were actually performed. In determining whether the development services were bona fide and were actually performed, the Plans will look for evidence of third-party financing, a commitment to produce (such as a first-look deal or output deal), a history of producing projects based on such development projects in the past, or any other evidence they deem relevant; and
  4. The director must not be a “principal” of the producer. A director will be considered a “principal” if the director’s spouse, children, parents or siblings, together have an ownership interest in the producer (or any closely related company) of 10% or more; and
  5. There is substantial evidence that the development services provided by the director were substantial and that the producer had invested substantial resources in the development of the project.
  6. Based on the above guidelines, the following are examples of circumstances under which contributions would not be accepted:
  1. Development services performed for a producer which has expended little or no resources toward the development of the project, except for payment of compensation to the director to develop the project.
  2. Development services performed for a producer which has no history of actually producing similar projects in the past unless there is some other indication that the project is not wholly speculative (such as a first-look deal, an output deal or third-party financing).
  3. Development services where the deal memo or personal services contract does not specifically provide that pension and health contributions are to be made on the compensation for such development services.
  4. Development services were performed by a director who has, and/or whose spouse, children, parents or siblings, together have an ownership interest in the producer (or any closely related company) of 10% or more.

Generally speaking, the Plans will accept contributions on behalf of Assistant Directors and Unit Production Managers getting paid by bona fide signatory production companies for traditional DGA services such as preparing budgets.

If you have any questions about these guidelines or their application to any particular production or contract, you may call either Gavin S. Gervis at (323) 866-2268 or Lisa Read at (323) 866-2255 at the Plans offices. Please also be aware that the Plans have the right to modify or discontinue these guidelines in the future.

Note that once a project moves from the development stage into pre-production, the DGA Basic Agreement requires that directors be pay-or-play and that contributions be paid on your behalf. If you have questions about that issue please call the DGA Contracts department (310) 289-2010, or on the East Coast call (212) 258-0809, at the DGA.
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