Home Disney News Disney Responds to U.S. Senator’s Request for Explanation of Massive Layoffs

Disney Responds to U.S. Senator’s Request for Explanation of Massive Layoffs

Disney Responds to U.S. Senator's Request for Explanation of Massive Layoffs
Credit: Disney Parks Blog

Disney CEO Bob Chapek has responded to Senator Warren’s letter asking why so many Cast Members have been laid off while salaries have been reinstated for top executives. She then replied back. Read the exchange below.

Letter to Disney

In a recent letter, dated October 13, 2020, sent by United States Senator Elizabeth Warren, Disney CEOs were asked to provide details regarding the massive employee layoffs and recent pay reinstatements for top Disney executives.

She commended Disney on working to provide healthcare for it’s laid-off employees over the last 6 months, but stressed the issue that:

“…thousands of laid off employees will now have to worry about how to keep food on the table as executives begin receiving hefty paychecks again.”

You can read the original letter HERE.

Disney Responds

According to CNN, Bob Chapek responded:

“[the senator’s] indictment that our past actions somehow weakened our financial cushion and our ability to retain and pay workers amid the pandemic is ill-considered and misleading.”

“As you are well aware, this unprecedented crisis has had a devastating impact on companies nationwide, and businesses large and small have had to take the difficult steps required to weather the impact,” he added.

“As the pandemic persisted, we had to make the difficult decision to furlough employees while continuing to pay the full cost of their health coverage,” Chapek continued. “More than six months after closing our domestic parks, with the outcome of the pandemic still very uncertain, we had no choice to lay off a number of non-working employees.”

Chapek added that Disney’s financial decisions over the past few years are “wholly unrelated to the need to lay off workers.”

“As we have stated, given the ongoing uncertainties of this pandemic, including limits on capacity to promote social distancing, and the State of California’s refusal to permit a safe reopening any time soon, it unfortunately is not feasible to pay non-working employees indefinitely.”

Senator Warren’s Rebuttal

Senator Warren does not believe Chapek’s response fully answers his questions about why so many Cast Members were laid off while top exeutive salaries were reinstated.

Disney won’t answer my questions because it has no good answers. The company said it was simply unfeasible to keep paying workers yet had no explanation for how it was feasible to restore senior executive pay,” Warren said on Wednesday.

“Disney spent its emergency fund by handing out billions of dollars to its top wealthy executives and shareholders in stock buybacks and dividends, but once the pandemic hit its business, it left thousands of workers holding the bag.”

We will continue to update if Disney responds again to Senator Warren.

What do you think of this exchange? Do you think Chapek fairly answered Warren’s questions? Let us know on Facebook.

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  1. A few high-salary executives don’t balance the cost for tens of thousands of employees. A cut in their pay won’t save many.

  2. The audacity of her to question how anyone runs a major corporation when she and her comrades are the very ones calling for the nation to be shuddered over a virus with a huge survival rate. Further, politicians in Congress (on both sides) continue to run up massive debt each year with zero care of how it will ever be paid back but want to question executives who make sound business decisions. The gall of that woman!

  3. Probably the same reason that government officials have not taken a pay cut despite closing down businesses and keeping people from making a living. Or holding out on a stimulus plan to help those same people out. I don’t necessarily agree with Disney forking out money to their top executives, but for a senator to call out a business when essentially she and her colleagues are doing the same thing….if not more to hurt working people. Might be a little hypocritical.

  4. I think part of the reason it’s the government’s business is that the federal government is helping to pay the unemployment insurance. And it’s possible the federal government has provided other pandemic relief funds to Disney. If the later is the case, it is DEFINITELY Congress’ business why the money was spent on reinstating the salaries of executives who can weather a pay cut vs. the salaries of employees who have been furloughed. And you can’t blame the furloughing of Disney World Cast Members on Gov. Newsom of California. The layoffs of the Nemo, Beauty & Beast, Main Street, Hoop-de-doo, and other cast in Florida is all on Disney.

  5. I don’t see why it is any of the governments business why Disney is making the decisions they are. They are paying the people that are working and not paying those that aren’t. Who cares how much the ones that are are actually getting paid. It’s none of our business. Even if the execs had kept a pay cut, the layoffs still would happen. If people don’t agree with how Disney runs the business, they can express that by not spending their money at Disney.

  6. Still, the question needs to be answered as to why the Disney executives did not take a pay cut. It does not take a genius to run the parks.

  7. Having just completed reading Disney War and seeing the kind of money top executives at Disney make, it is extremely disappointing that they are being fully compensated for mediocre decision making while the theme park experience will lose all of its shows and actors for a time longer than the pandemic will last. I am sure needless fireworks will be reinstated before the citizens of Main Street make a return (if at all) or we see the Monsters Inc Laugh Factory up and running again. Sure, not being able to open Disneyland hurts the bottom line, but pointing that out as you lay off tens of thousands of employees as you rake in literally hundreds of millions of dollars in personal salary is the definition of creating a straw man argument, which is what Chapek did in response to Warren. I know he has had difficulties out of his control, but in the face of adversity, Chapek has failed miserably. I hope he isn’t CEO for very long. I am sure he and Iger’s monthly executive retreats to Aspen aren’t stopping any time soon.

  8. I wouldn’t say that Disney is innocent here but I agree with you about the governor of California. His mandates are beyond ridiculous and Disneyland should have already opened. The Disney Company has already proven that they can open the parks safely.

    That being said, I believe all of these layoffs and the recent announcement(s) stating the closing of every show, no cast members on Main Street, etc, are only going to continue to hurt Disney. It’s difficult to think about easily spending $4,000 to fly halfway across the country, stay in a more expensive resort (because the All-Star resorts have yet to open), Disney tickets with no park hoppers, reduced hours, reduction of restaurants, no character meet & greets or autographs, etc. It would appear that Disney is a shell of itself. I don’t like wearing them but I can deal with the mask mandate, if necessary. But spending so much money on an abundant lack of the magic we are used to when visiting a Disney park is very difficult to justify. I imagine that I’m not the only person out there seriously considering canceling our vacation, which will only perpetuate the matter at hand. That is less money in Disney’s pockets.

    All of the lay-offs of Disney cast members is very depressing and I feel for them. I’ve also made a donation through their pantry. I don’t see how these top executives, in good conscience, can resume taking million dollar salaries when so many loyal cast members have been laid off. It’s just not right. Senator Warren is not a favorite of mine; however, I think her questions and comments are spot on in this case.

  9. Executives can also take a pay cut so that Disney can help out with salaries for the hourly workers. These top executives make millions per year. Taking a pay cut won’t affect them financially. However the Average Joe that got laid off is suffering financially finding a way to pay bills and keep food on the table. Something that none of these top Disney corporate executives will ever know or encounter themselves because they live lavish lifestyles.

  10. Instead of pressuring Disney why doesn’t Elizabeth demand an explanation from the governor of California?!?! He is to blame!!! Not Disney!!!!

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