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Disney to axe 32,000 jobs as theme parks reel from Covid

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About 32,000 jobs at Walt Disney are set to be axed by the end of March as the entertainment giant’s parks, resorts and cruise businesses continue to lose millions of dollars because of Covid-19.

The company had already announced plans to cut about 28,000 jobs in September, a move that drew sharp criticism within the US.

Disney employs around 203,000 people, according to its most recent annual report, 80% of whom are full time and 20% part time.

In addition to the layoffs, Disney said it had roughly 37,000 employees on furlough as of 3 October as a result of the crisis. These workers are not expected to be laid off.

The layoffs were disclosed in a filing to the US Securities and Exchange Commission on Wednesday.

Disney said there could be further cuts which could see investment slashed in television and film productions, and further employees furloughed and made redundant.

“Some of these measures may have an adverse impact on our businesses,” Disney said in the filing.

Disney’s parks business, which employs more than 100,000 employees in the US, has been massively hit by the pandemic. Its 12 parks are located in California, Florida and beyond the US in Paris, Shanghai, Hong Kong and Tokyo. All were closed between March and May, with Shanghai and Florida facilities reopening after the first wave of Covid. Paris had reopened but was forced to close as the second wave hit in October.

The company’s streaming service, Disney+, on the other hand has been growing rapidly and now has 74 million subscribers – leading to a 16% increase in streaming revenues. Disney CEO Bob Chapek said the direct-to-consumer business was key to the company’s future.

The redundancies will take place in the early part of 2021, Disney announced.

Disney recorded a loss of $2.8bn for the year to 30 September, as opposed to the profit of $10.4bn for the same period the previous year.

Last month former Democratic leadership candidate senator Elizabeth Warren criticised the company for making job cuts at the same time as restoring executive employees’ pay after initially taking pay cuts.

She wrote to Capek: “Your company prioritised the enrichment of executives and stockholders through hefty compensation packages, and billions of dollars’ worth of dividend payments and stock buybacks, all of which weakened Disney’s financial cushion and ability to retain and pay its front-line workers amid the pandemic.”

Warren did acknowledge Disney’s decision to pay the healthcare costs of furloughed staff, however.

Abigail Disney, the granddaughter of Disney co-founder Roy Disney, has also criticised the company’s response to the pandemic. In April she described executive chairman Robert Iger’s $65m pay package as “insane” and called for more resources to be directed to the firm’s low-paid workers.

Disney’s leaders have rejected the criticism saying they were misinformed.

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