Politics 28000 Layoffs coming to Disney's domestic theme parks - statement from Josh D'Amaro

[UNCgolf]

So if no pandemic occurred and there was no interruption of any park operations including the indefinite closure of one of the domestic parks, TWDC would have still laid off 28K CM including all those performers and all those in entertainment?

They would have laid of a large fraction of WDW and DLR CM, end the DCP and international CM program?

Layoffs are no surprise to Disney, even in good times, they always cut mercilessly. I would agree that they were going to cut what they thought was “excess”, but no one has said anywhere that it was going to be on the scale of what has transpired so far.

The parks are going to take time to get back to pre-pandemic levels. It’s not going to be a light switch. The sooner they open the sooner they can start recovering as more people become more comfortable returning to normal activities. The longer DLR stays closed the longer it’s recovery will take.

Basically, yes. It just wouldn't have happened in one fell swoop, and it may not have been the exact same people. It's much easier to eliminate 28,000 jobs over multiple years (not that I'm saying it would have been that exact number) than it is to do all at once for various reasons, but the pandemic changed the calculus.

I believe Martin said the vast majority of these cuts were already in the planning stages.

 

[UNCgolf]

Shareholders provide working capital. The connection between Shareholders and the companies they support enforce it.

That's still not a requirement for short-term stock gains, especially when the measures taken to provide short-term value can cause long-term issues that could eventually depress the long-term value. It depends on the type of investor, which is why there's no requirement whatsoever to maximize short-term profits.

 

[monothingie]

Basically, yes. It just wouldn't have happened in one fell swoop, and it may not have been the exact same people. It's much easier to eliminate 28,000 jobs over multiple years (not that I'm saying it would have been that exact number) than it is to do all at once for various reasons, but the pandemic changed the calculus.

I believe Martin said the vast majority of these cuts were already in the planning stages.

Ok so someone planning on eliminating an unknown number of CM over the course of several years (of which they’ve done before, and also hired new people BTW) is not the same as a massive one time hit due to unprecedented circumstances.

 

[Lora Baines Bradley]

I think what really makes me mad about all of this is that Disney quietly reinstated executive bonuses not too long before these cuts. They made a big show about forgoing salary but are quick to take their bonuses back. It shows that they don’t value those front line CMs that are the backbone of the parks that made the execs their millions upon millions.

Fox Corp., Disney End Temporary Pandemic Pay Cuts for Executives

Fox and Disney have both reinstated executive salaries for most of those impacted by temporary pay cuts amid the COVID-19 pandemic.

variety.com

 

[GimpYancIent]

I think what really makes me mad about all of this is that Disney quietly reinstated executive bonuses not too long before these cuts. They made a big show about forgoing salary but are quick to take their bonuses back. It shows that they don’t value those front line CMs that are the backbone of the parks that made the execs their millions upon millions.

Fox Corp., Disney End Temporary Pandemic Pay Cuts for Executives

Fox and Disney have both reinstated executive salaries for most of those impacted by temporary pay cuts amid the COVID-19 pandemic.

variety.com

Hmmmmmm. Just a suggestion, but, if the corporation is streamlining that means less need for executives soooo a streamlining of the executive ranks seems in order.

 

[Riverrafter21]

It shows that they don’t value those front line CMs that are the backbone of the parks that made the execs their millions upon millions.

Disney provided their paycheck in a timely manor and for the agreed upon amount, I think that shows they valued their labor.

 

[UNCgolf]

Ok so someone planning on eliminating an unknown number of CM over the course of several years (of which they’ve done before, and also hired new people BTW) is not the same as a massive one time hit due to unprecedented circumstances.

It's not about eliminating some people and then hiring new people to replace them later. Management wants these jobs permanently eliminated. They want to have significantly fewer employees overall.

Mentioning the inability to reopen Disneyland was just a feint to place the blame elsewhere (and also to pressure the government to let them open) in the hopes that people would believe it.

 

[wannabeBelle]

Disney's market cap as of this morning is just under $229 billion. It pays an annual dividend of $3B to its shareholders.

Disney has nearly unlimited means to keep those 28,000 CMs on payroll for at least a year.

For example, Disney could've cut its dividend by 33% - just this once - and paid each CM $35,714. Or they could've issued debt.

The US Supreme Court has already ruled that companies aren't legally required to maximize profits for shareholders. Disney had no financial obligation to fire those CMs. It wasn't inevitable - it was a management choice to favor shareholders over employees.

Thank you Len. I am not a fan of Elizabeth Warrren so that isnt where this is coming from, but paying dividends to your stockholders and reinstating executive pay to 100% while terminating 28K castmembers isn't a great look for Disney. Not saying that it cant legally be done, but is that the best move? A very "Let them eat cake" kind of thought process. We know how well that worked out for Marie Antionette. I personally would have preferred to see money invested in the cast and the parks to encourage people to come visit. This is the ONLY way that Disney will recover is through people booking trips and coming to enjoy themselves again. If the investments arent in the cast members, the perception of value will drop. I have a deep respect for the cast members. They are the Makers of Magic, they are the smiling faces I see, the helpful actions towards guests, the entertainment that provides memories for many years, etc. I have not ever met one executive in my time in the Parks and Resorts. I doubt most of us have, but the hourly cast members are the ones that you want to try to save, because those people are who make the magic for the average guest. Were some cuts unavoidable? Maybe and I would say definitely with the pandemic factored in but if Disney had come out and said that they took measures to save as many CM's as they could and to that end the executives have extended their pay cuts, Dividend payments were reduced for this one time, etc. I think it would have been a much better look for the company. Marie

 

[monothingie]

It's not about eliminating some people and then hiring new people to replace them later. Management wants these jobs permanently eliminated. They want to have significantly fewer employees overall

Anytime an employee or position is eliminated it is a difficult thing for everyone involved. There’s no sugar coating the awful experience. Long term Restructuring, as from what you described is common. Disney has a bloated bureaucracy and probably carries many positions that aren’t needed. Corporations change and job functions change. I’ve been personally both a beneficiary and a victim of the dynamic environment.

The difference here is that if the pandemic didn’t occur would you see the same number of front line CM and entertainment CM let go? Since no one knows any specifics other than there was a plan to let people go, you can’t say what happened now was the desired result of what they were planning pre-pandemic.

 

[wannabeBelle]

The difference here is that if the pandemic didn’t occur would you see the same number of front line CM and entertainment CM let go? Since no one knows any specifics other than there was a plan to let people go, you can’t say what happened now was the desired result of what they were planning pre-pandemic.

I tend to agree with most of your statement but over the last number of years entertainment specifically has been getting decimated with either a substandard replacement or no replacement at all being forthcoming. This was definitely not due to Covid as prior to this year that wasnt a factor. I started following it about 6 years ago with Off Kilter's termination along with others, than the following year with Mulch, Sweat & Shears. I'm sure more cuts were planned for this year which were in line with previous years. More were added due to the pandemic, but I dont think this was the only reason for the terminations. Marie

 

[flynnibus]

Because it is the right thing to do for a company of Disney's standing to look after those who have given so much to get the company into the position it has enjoyed for so many years.

That's what they call 'severance pay'

Disney did do their part for employees by holding the company intact while they faced a temporary shift. Now that shift is not temporary, but probably medium term at least.

It's not the place of Disney to be a welfare system. It's an employer - and it no longer needs those employees. Sorry, but anything trying to just keep the status quo is not practical.

The game has changed, son of flynn...

 

[monothingie]

Because it is the right thing to do for a company of Disney's standing to look after those who have given so much to get the company into the position it has enjoyed for so many years.

That company died many years ago.

Also that company (as it was then) would have never been able survive today.

 

[TrainsOfDisney]

Also that company (as it was then) would have never been able survive today.

Very debatable.

 

[flynnibus]

Bob Iger’s salary was 48 million in 2019. Fill in the rest.

 

[flynnibus]

Anytime an employee or position is eliminated it is a difficult thing for everyone involved. There’s no sugar coating the awful experience. Long term Restructuring, as from what you described is common. Disney has a bloated bureaucracy and probably carries many positions that aren’t needed. Corporations change and job functions change. I’ve been personally both a beneficiary and a victim of the dynamic environment.

Its like no one remembers all the complaining about useless roles in TDA, TDO, middle managers, etc.

Maybe management was looking to stop the bloat and trim down... but as you say, nothing changes the fact that Disney's business now and for the mid term future is not the same as it was at the start of the last FY.

 

[Vegas Disney Fan]

Not sure where you got these numbers from. Bob Iger’s salary in 2019 was 42 million.

Disney chairman Bob Iger to forgo his salary to help company during coronavirus pandemic

Iger isn't the only Disney employee giving up some earnings while the Disney parks remain closed.

www.cbsnews.com

His total compensation including bonuses and stock was $40+ million but the vast majority of that was bonuses. There’s no way he’s making the same bonuses in 2020 with overall losses that he made in 2019 when the company made billions in profits.

 

[flynnibus]

I think that sums up what a company should do in this type of environment.

Our country needs to try to save jobs and not eliminate them. It is also not a blue vs red thing either (tired of hearing that)

Helping others less fortunate who have been the face of your company and were primarily responsible for customers returning used to be good business. (Frontline workers make the experience, not the top executives)
Disney has/had options to ensure keeping the staff at least another 6 months.
All top executives take significant pay cuts
All mid-tier executives (most make well over 6 figures) take some type of pay cuts
Cut or remove the dividend (as a former disney shareholder, I would have accepted this no problem)

I am not saying that you could avoid layoffs forever, but I do believe that given the circumstances, trying to help for at least a year (getting your employees through the holiday season) is not unreasonable.

Disney already cut the dividend for first half of the year. Come on people, it wasn't that long ago.. lets keep a level head.

Keep employees another 6 months and then what?? Beg they be kept for another 6months? When does it stop?

 

[Lilofan]

Disney chairman Bob Iger to forgo his salary to help company during coronavirus pandemic

Iger isn't the only Disney employee giving up some earnings while the Disney parks remain closed.

www.cbsnews.com

His total compensation including bonuses and stock was $40+ million but the vast majority of that was bonuses. There’s no way he’s making the same bonuses in 2020 with overall losses that he made in 2019 when the company made billions in profits.

Won't really affect him. I'm sure his net worth long term invested in company stock and other investments will make him a billionaire in a few years.

 

[UNCgolf]

Its like no one remembers all the complaining about useless roles in TDA, TDO, middle managers, etc.

Maybe management was looking to stop the bloat and trim down... but as you say, nothing changes the fact that Disney's business now and for the mid term future is not the same as it was at the start of the last FY.

I don't think that's what people are complaining about. They're complaining about all the cut positions that will actually affect the guest experience going forward, and there appear to be a ton of them.

Cutting the bloat and trimming down is exactly what Iger has said he wants to do, but what he (and other senior management) considers bloat and what guests visiting the parks consider bloat may be very different things.

It all depends on whether those cuts are temporary or permanent, but as I said before, insiders have hinted that many (most?) of them are probably permanent.

With that said, I don't blame them. If they could, for example, eliminate all live entertainment in all the parks and yet still have people lining up to buy tickets, why wouldn't they? There's no downside for the company in that scenario.

 

[Vegas Disney Fan]

Won't really affect him. I'm sure his net worth long term invested in company stock and other investments will make him a billionaire in a few years.

I agree, but my point is his compensation package has relatively no affect on CM layoffs either, had the entire executive team taken no salaries it would have just delayed the layoffs by a couple weeks.

Disney is such a huge company with such massive overhead that millions doesn’t go very far.