Senator Elizabeth Warren wrote a poignant and harsh letter to senior executives at The Walt Disney Company, asking for answers in the wake of mass layoffs that impacted up to 28,000 cast members at Walt Disney World and Disneyland Resort. In it, he reiterates many valid points, from the blatant payback of Bob Chapek and other executives a few months before the mass layoff, to other questionable business priorities, such as paying generous dividends to shareholders and buying back their own shares.
Dear Mr. Iger and Mr. Chapek:
I am writing to express concern about the recent decision by the Walt Disney Company (Disney) to lay off 28,000 workers during an economic downturn, while restoring wage rates for highly paid senior executives. In the years leading up to this crisis, your company has prioritized the enrichment of executives and shareholders through hefty compensation packages and billions of dollars in dividend payments and share buybacks, all of which have weakened the financial buffer of Disney and the ability to hold him back and frontline workers amid the pandemic. While I appreciate the fact that your company has continued to provide health care to the laid-off workers for the past six months, thousands of laid-off employees will now have to worry about how to keep food on the table as executives start receiving hefty salaries again.
The letter begins by acknowledging the company̵
Since the start of the pandemic, California has had over 830,000 cases of COVID-19, and over 16,000 people in the state have died … While your company has blamed your decision to lay off thousands of workers on California’s public health measures, that have been implemented to prevent the spread of COVID-19 and save lives, nearly 6,400 of the laid-off employees are currently in Florida. And just last week, another 8,857 part-time employees were laid off, also in Florida.
California is now a point of contention as state officials and Disney executives collide with reopening dates and guidelines. As Warren succinctly points out, while Disney blamed the extended closure of Disneyland Resort as a major factor in “exacerbating” the financial impact of COVID-19, most of the layoffs took place in Florida.
The September 29 announcement describes the staff reduction as a “very difficult decision” resulting from the “prolonged impact of COVID-19 on our business”. However, this explanation fails to acknowledge Disney’s short-sighted corporate decisions that have shrunk its capital, including (1) spending billions of dollars to buy back its stock over the past decade, (2) rewarding its shareholders through billions of dollars in dividend payments, and (3) showering its top corporate executives with exaggerated pay packages …
Warren boldly states that Disney’s myopia is what ultimately led to these mass layoffs, and while it’s been called a “very difficult decision,” it’s not clear that the company will offer these cast members any form of relief. In short, “Disney has taken care of its top executives and shareholders and is now drying its frontline workers.”
Senator Warren’s thoughts mirror many of the opinions we’ve reflected in our posts here at WDWNT, and we appreciate her stance on behalf of cast members on both coasts. You can read her full letter incorporated below, including a series of 7 follow-up questions to which she asks for an answer by October 27, 2020.