Disneyland workers and supporters rally while protesting low pay and calling for a living wage at the Disneyland entrance on July 3, 2018 in Anaheim, California. (Photo: Mario Tama/Getty Images)
Sen. Warren Slams Disney for 28,000 Fired Workers Amid Stock Buyback Spree
"It appears that—prior to, and during the pandemic—Disney took good care of its top executives and shareholders—and now is hanging its front-line workers out to dry."
Sen. Elizabeth Warren tore into the CEO and chairman of the Walt Disney Company on Tuesday with a letter demanding they explain their decision to reward executives with huge payouts amid the coronavirus pandemic while laying off 28,000 employees.
"In the years leading up to this crisis, your company prioritized 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," the Massachusetts Democrat wrote in her letter (pdf) to executive chairman Robert Iger and CEO Bob Chapek.
"I would like to know whether Disney's financial practices have impacted the company's decision to lay off workers," she continued, "and whether your company plans to extend healthcare or other critical benefits and protections to laid off employees."
The senator's letter follows Disney's announcement last month that the company was laying off the workers.
In a September 29 memo, head of parks Josh D'Amaro told employees that the company had to make "some difficult decisions" and had "modified... operations to run as efficiently as possible" to weather the budget shortfall as a result of the pandemic. D'Amaro asserted that the layoffs were "the only feasible option we have in light of the prolonged impact of Covid-19 on our business, including limited capacity due to physical distancing requirements and the continued uncertainty regarding the duration of the pandemic."
Warren, in her letter, took issue with D'Amaro for blaming California's "unwillingness to lift restrictions that would allow Disneyland to reopen." Warren countered that the state-imposed measures "were implemented to prevent the spread of Covid-19 and save lives." What's more, she wrote, "nearly 6,400 of the employees you laid off are actually in Florida. And just last week, another 8,857 part-time employees were laid off, also in Florida."
The senator took further issue with the memo for "fail[ing] to acknowledge Disney's short-sighted business decisions that reduced its capital, including spending billions of dollars to repurchase its own shares over the last decade, rewarding its shareholders through billions of dollars in dividend payments, and showering its top company executives with over-the-top compensation packages and salaries--which reportedly were restored several weeks before the September layoff announcement."
While acknowledging that Iger and Chapek reduced their own salaries in April in light of the economic impact of the pandemic, the senator said the cuts represented a mere "drop in the bucket" and were short-lived. Warren continued:
For example, Mr. Iger earned a total of $65.6 million in 2018 and $47 million in 2019 as a result of this compensation package; hence, his pandemic-inspired salary cut amounted to roughly 3.3% percent of his total compensation in 2019. Similarly, Mr. Chapek, who recently was promoted to CEO, was in line to earn up to $22.5 million in bonuses in addition to his base salary. Even worse, reports indicated that Disney was restoring the meager proposed cuts to executive pay in August 2020--just weeks before the announcement of the 28,000 worker layoffs.
Warren issued an October 27 deadline for answers to a number of questions about the company's recent moves, including whether it would provide healthcare coverage and cover premiums for laid-off employees.
She also demanded to know the total value of stock buybacks made by Disney in each quarter over the past four years, the increase those buybacks had on stock value, and how they may have specifically benefited Disney's top executives.
"It appears that--prior to, and during the pandemic--Disney took good care of its top executives and shareholders," wrote Warren, "and now is hanging its front-line workers out to dry."
Urgent. It's never been this bad.
Dear Common Dreams reader, It’s been nearly 30 years since I co-founded Common Dreams with my late wife, Lina Newhouser. We had the radical notion that journalism should serve the public good, not corporate profits. It was clear to us from the outset what it would take to build such a project. No paid advertisements. No corporate sponsors. No millionaire publisher telling us what to think or do. Many people said we wouldn't last a year, but we proved those doubters wrong. Together with a tremendous team of journalists and dedicated staff, we built an independent media outlet free from the constraints of profits and corporate control. Our mission from the outset was simple. To inform. To inspire. To ignite change for the common good. Building Common Dreams was not easy. Our survival was never guaranteed. When you take on the most powerful forces—Wall Street greed, fossil fuel industry destruction, Big Tech lobbyists, and uber-rich oligarchs who have spent billions upon billions rigging the economy and democracy in their favor—the only bulwark you have is supporters who believe in your work. But here’s the urgent message from me today. It’s never been this bad out there. And it’s never been this hard to keep us going. At the very moment Common Dreams is most needed and doing some of its best and most important work, the threats we face are intensifying. Right now, with just two days to go in our Spring Campaign, we're falling short of our make-or-break goal. When everyone does the little they can afford, we are strong. But if that support retreats or dries up, so do we. Can you make a gift right now to make sure Common Dreams not only survives but thrives? There is no backup plan or rainy day fund. There is only you. —Craig Brown, Co-founder |
Sen. Elizabeth Warren tore into the CEO and chairman of the Walt Disney Company on Tuesday with a letter demanding they explain their decision to reward executives with huge payouts amid the coronavirus pandemic while laying off 28,000 employees.
"In the years leading up to this crisis, your company prioritized 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," the Massachusetts Democrat wrote in her letter (pdf) to executive chairman Robert Iger and CEO Bob Chapek.
"I would like to know whether Disney's financial practices have impacted the company's decision to lay off workers," she continued, "and whether your company plans to extend healthcare or other critical benefits and protections to laid off employees."
The senator's letter follows Disney's announcement last month that the company was laying off the workers.
In a September 29 memo, head of parks Josh D'Amaro told employees that the company had to make "some difficult decisions" and had "modified... operations to run as efficiently as possible" to weather the budget shortfall as a result of the pandemic. D'Amaro asserted that the layoffs were "the only feasible option we have in light of the prolonged impact of Covid-19 on our business, including limited capacity due to physical distancing requirements and the continued uncertainty regarding the duration of the pandemic."
Warren, in her letter, took issue with D'Amaro for blaming California's "unwillingness to lift restrictions that would allow Disneyland to reopen." Warren countered that the state-imposed measures "were implemented to prevent the spread of Covid-19 and save lives." What's more, she wrote, "nearly 6,400 of the employees you laid off are actually in Florida. And just last week, another 8,857 part-time employees were laid off, also in Florida."
The senator took further issue with the memo for "fail[ing] to acknowledge Disney's short-sighted business decisions that reduced its capital, including spending billions of dollars to repurchase its own shares over the last decade, rewarding its shareholders through billions of dollars in dividend payments, and showering its top company executives with over-the-top compensation packages and salaries--which reportedly were restored several weeks before the September layoff announcement."
While acknowledging that Iger and Chapek reduced their own salaries in April in light of the economic impact of the pandemic, the senator said the cuts represented a mere "drop in the bucket" and were short-lived. Warren continued:
For example, Mr. Iger earned a total of $65.6 million in 2018 and $47 million in 2019 as a result of this compensation package; hence, his pandemic-inspired salary cut amounted to roughly 3.3% percent of his total compensation in 2019. Similarly, Mr. Chapek, who recently was promoted to CEO, was in line to earn up to $22.5 million in bonuses in addition to his base salary. Even worse, reports indicated that Disney was restoring the meager proposed cuts to executive pay in August 2020--just weeks before the announcement of the 28,000 worker layoffs.
Warren issued an October 27 deadline for answers to a number of questions about the company's recent moves, including whether it would provide healthcare coverage and cover premiums for laid-off employees.
She also demanded to know the total value of stock buybacks made by Disney in each quarter over the past four years, the increase those buybacks had on stock value, and how they may have specifically benefited Disney's top executives.
"It appears that--prior to, and during the pandemic--Disney took good care of its top executives and shareholders," wrote Warren, "and now is hanging its front-line workers out to dry."
Sen. Elizabeth Warren tore into the CEO and chairman of the Walt Disney Company on Tuesday with a letter demanding they explain their decision to reward executives with huge payouts amid the coronavirus pandemic while laying off 28,000 employees.
"In the years leading up to this crisis, your company prioritized 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," the Massachusetts Democrat wrote in her letter (pdf) to executive chairman Robert Iger and CEO Bob Chapek.
"I would like to know whether Disney's financial practices have impacted the company's decision to lay off workers," she continued, "and whether your company plans to extend healthcare or other critical benefits and protections to laid off employees."
The senator's letter follows Disney's announcement last month that the company was laying off the workers.
In a September 29 memo, head of parks Josh D'Amaro told employees that the company had to make "some difficult decisions" and had "modified... operations to run as efficiently as possible" to weather the budget shortfall as a result of the pandemic. D'Amaro asserted that the layoffs were "the only feasible option we have in light of the prolonged impact of Covid-19 on our business, including limited capacity due to physical distancing requirements and the continued uncertainty regarding the duration of the pandemic."
Warren, in her letter, took issue with D'Amaro for blaming California's "unwillingness to lift restrictions that would allow Disneyland to reopen." Warren countered that the state-imposed measures "were implemented to prevent the spread of Covid-19 and save lives." What's more, she wrote, "nearly 6,400 of the employees you laid off are actually in Florida. And just last week, another 8,857 part-time employees were laid off, also in Florida."
The senator took further issue with the memo for "fail[ing] to acknowledge Disney's short-sighted business decisions that reduced its capital, including spending billions of dollars to repurchase its own shares over the last decade, rewarding its shareholders through billions of dollars in dividend payments, and showering its top company executives with over-the-top compensation packages and salaries--which reportedly were restored several weeks before the September layoff announcement."
While acknowledging that Iger and Chapek reduced their own salaries in April in light of the economic impact of the pandemic, the senator said the cuts represented a mere "drop in the bucket" and were short-lived. Warren continued:
For example, Mr. Iger earned a total of $65.6 million in 2018 and $47 million in 2019 as a result of this compensation package; hence, his pandemic-inspired salary cut amounted to roughly 3.3% percent of his total compensation in 2019. Similarly, Mr. Chapek, who recently was promoted to CEO, was in line to earn up to $22.5 million in bonuses in addition to his base salary. Even worse, reports indicated that Disney was restoring the meager proposed cuts to executive pay in August 2020--just weeks before the announcement of the 28,000 worker layoffs.
Warren issued an October 27 deadline for answers to a number of questions about the company's recent moves, including whether it would provide healthcare coverage and cover premiums for laid-off employees.
She also demanded to know the total value of stock buybacks made by Disney in each quarter over the past four years, the increase those buybacks had on stock value, and how they may have specifically benefited Disney's top executives.
"It appears that--prior to, and during the pandemic--Disney took good care of its top executives and shareholders," wrote Warren, "and now is hanging its front-line workers out to dry."