Board of Trustees Continues Its Focus on Strengthening the Basic Pension Plan

The past two years, the Board of Trustees of the Directors Guild of America-Producer Pension and Health Plans took a number of steps to strengthen the Basic Pension Plan’s financial status for future generations of participants and their beneficiaries.

Included in the Board’s actions were two previous 0.5% increases in the employer pension contribution rate from 5.5% to 6% of compensation effective July 1, 2017 and from 6% to 6.5%, effective July 1, 2018. The first increase was negotiated as part of the 2017 Basic, FLTTA, Commercial and Networks’ Collective Bargaining Agreements (the “Agreements”). The Agreements also allow the Directors Guild of America (DGA) the option to allocate up to 0.5% of the negotiated increases in the minimum salary rates in each of the second and third years of the agreements. In this third year of the agreement, the DGA has again exercised the option for a second time to further ensure the Basic Plan’s ability to pay promised benefits.

Effective July 1, 2019 for the Basic, FLTTA and Network Agreements, and effective December 1, 2019 for the Commercial Agreement, the DGA has diverted the entire 0.5% increase in the Employer contribution rate to the Pension Plans, increasing it from 6.5% to 7.0% of compensation.

The resulting allocations between the Basic and Supplemental Plans will change to the following:

  • 7.0% of the first $20,000 in compensation (changed from 6.5%) to the Basic Plan;
  • 4.8% of compensation (changed from 4.3%) exceeding $20,000 up to a maximum of $150,000 to the Basic Plan;
  • 2.2% of compensation exceeding $20,000 up to a maximum of $150,000 to the Supplemental Plan (unchanged); and
  • 7.0% of compensation (changed from 6.5%) in excess of $150,000 to the Supplemental Plan

For more information on this change, refer to the March 2015 Pension Plans Summary Plan Description and its updates available, at www.dgaplans.org/forms/pension.

For details on the past changes made to the Basic Plan, refer to the Summer 2017, Winter 2017 and Spring 2018 Spotlight on Benefits newsletters, available at www.dgaplans.org/newsletters.