The Walt Disney Company sustained an early financial hit from the COVID-19 pandemic, as the company was forced to shutter its theme parks and cruise lines, first in Asia and Europe, followed by North America. Now with theaters closed around the world, the company is furloughing some of its workforce starting on April 19, most likely from the amusement parks. In making the announcement the company instructed employees on how to apply for government benefits.
“The COVID-19 pandemic is having a devastating impact on our world,” stated the Walt Disney Company on Thursday, “with untold suffering and loss, and has required all of us to make sacrifices. Over the last few weeks, mandatory decrees from government officials have shut down a majority of our businesses. Disney employees have received full pay and benefits during this time, and we’ve committed to paying them through April 18, for a total of five additional weeks of compensation. However, with no clear indication of when we can restart our businesses, we’re forced to make the difficult decision to take the next step and furlough employees whose jobs aren’t necessary at this time.
The furlough process will begin on April 19, and all impacted workers will remain Disney employees through the duration of the furlough period. They will receive full healthcare benefits, plus the cost of employee and company premiums will be paid by Disney, and those enrolled in Disney Aspire will have continued access to the education program. Additionally, employees with available paid time off can elect to use some or all of it at the start of the furlough period and, once furloughed, they are eligible to receive an extra $600 per week in federal compensation through the $2 trillion economic stimulus bill, as well as state unemployment insurance.”
February 25 brought the surprise retirement announcement of Disney CEO Bob Iger, who was able to claim credit for an astonishingly strong run since he took over Disney from Michael Eisner in 2005, including the acquisition of the Pixar, Marvel, and Lucasfilm labels and the studio Twentieth Century Fox, as well as the successful launch of streaming service Disney+ and takeover of majority interest in Hulu. Iger is still assisting the transition to new CEO Bob Chapek, who is charged with bringing the company back from the economic precipice of the Coronavirus.
Disney executives at the VP level and above will take pay cuts of 20-30 percent, the studio announced earlier this week, including Iger, who is not taking his salary for the moment, while Chapek is going with half-pay.
Industry leader Disney was dominating the box office well before it bought what is now called Twentieth Century, and was a seemingly unstoppable studio juggernaut — until it took “Onward” from its shortened theater run onto VOD, and postponed the release of live-action remake “Mulan” and Marvel’s “Black Widow.” A move of June 19 release “Soul,” from Pixar, is also expected.
But Thursday the company bowed to the inevitable. Hollywood is watching as agencies cut employee paychecks and other studios weigh their own furlough plans, as they shuffle their release decks and rent and sell their movies online. For the moment, nobody knows when there will ever be a new normal.