(Bloomberg) -- The Directors Guild of America reached a tentative agreement with the Alliance of Motion Picture and Television Producers, which represents Hollywood studios, a victory for one of several entertainment industry unions seeking adjusted contracts this summer. 

The tentative agreement reached Saturday will allocate a 5% wage increase in the first year of contract, 4% in the second year and 3.5% in the third year, according to a statement from the union, DGA. The deal also says that generative AI cannot replace duties performed by members as the technology isn’t considered a person. 

“We have concluded a truly historic deal,” Jon Avnet, chair of the DGA’s Negotiations Committee said in the statement. “In these negotiations we made advances on wages, streaming residuals, safety, creative rights and diversity, as well as securing essential protections for our members on new key issues like artificial intelligence.” 

As many Hollywood employees face contract expirations mid-summer, the agreement may provide a glimmer of hope for other industry unions advocating for higher pay and staffing insurances. The Writers Guild of America, which represents over 11,000 screenwriters, has been on strike since May, prompting the industry’s biggest film and TV studios to halt payments to some writer-producers.

The use of AI in the writers room is among top concerns for Hollywood workers, as media companies begin implementing new technology into their content creation process. The market saturation of streaming content has also introduced rapid changes in staffing needs, in turn, bringing some Hollywood studios to mass layoffs. 

The Writers Guild of America released a statement, alongside other guilds, ahead of DGA negotiations this past weekend saying they stand with them in solidarity. 

The deal is set be submitted to the Directors Guild of America National Board at a special meeting on Tuesday.



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