Warren rips Disney over layoffs amid reported restoration of executive pay

Sen. Elizabeth Warren (D-Mass.) called for answers on Wednesday on Disney laying off 28,000 workers while reportedly restoring the salaries of its senior executives during the coronavirus pandemic.

Disney said last month that it plans to lay off the employees due to the lack of attendance at its parks around the world. Warren, however, noted in a letter to Disney Executive Chairman Bob Iger and CEO Bob Chapek that the company said it would restore the paychecks of executives to pre-COVID-19 levels in August. 

“I would like to know whether Disney’s financial practices have impacted the company’s decision to lay off workers and whether your company plans to extend health care or other critical benefits and protections to laid off employees,” the senator wrote.

She added that the company has invested in compensation packages, dividend payments and stock buybacks in recent years for executives and stockholders, “all of which weakened Disney’s financial cushion and ability to retain and pay its front-line workers amid the pandemic.”

Warren asked for information by Oct. 27 on which types of employees will be laid off, how decisions were made on the layoffs, if Disney will provide health care coverage for laid-off employees and the total compensation Disney gave its top executives in 2019 and 2020, among other information. 

She wrote that Disney spent $47.9 billion in repurchasing its own stock from 2009 to 2018, as well as $5.4 billion in dividend payments. Also, Disney paid over $338 million in total compensation to 20 top executives in the three years before the pandemic.

Iger is forgoing his salary in 2020 and Chapek is forgoing half of his, which Warren calls “a drop in the bucket” due to the compensation packages executives receive. 

For years, Disney invested big-time in stock buybacks to pump up stock prices and dividend payments for wealthy shareholders. And just weeks before the devastating layoffs, Disney decided its executives had sacrificed enough for COVID-19 and restored their over-the-top salaries.

— Elizabeth Warren (@SenWarren) October 14, 2020

She also noted that, in its September announcement, Disney said the issue was exacerbated in California due to restrictions that have prevented Disneyland from reopening.

“While your company has blamed your decision to lay off thousands of workers on California public health measures, which were implemented to prevent the spread of COVID-19 and save lives, 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,” she wrote. 

A Walt Disney Company spokesperson told The Hill in a statement that Warren’s letter is “misinformed.”

“Senator Warren’s misinformed letter contains a number of inaccuracies. We’ve unequivocally demonstrated our ability to operate responsibly with strict health and safety protocols in place at all of our theme parks worldwide, with the exception of Disneyland Resort in California, where the State has prevented us from reopening even though we have reached agreements with unions representing the majority of our Cast Members that would get them back to work,” the spokesperson said.