Senator Warren asks Disney to explain dividend payments and high executive pay while laying off 28000 of its front line workers

6 days ago in "The Walt Disney Company"

United States Senator Elizabeth Warren (D-Mass.) has sent a letter to The Walt Disney Company to obtain information on the company's announced layoffs of 28,000 workers and what Warren views as a prioritization of stock buybacks, dividend payments, and high executive pay.

In the letter to Disney, she says, "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." "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." She goes on to say, "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."

You can view the full text of the letter from Senator Warren here.

As part of the 28000 workers at the domestic theme parks who are being separated from the company, more than 20000 of them are at Walt Disney World. Among the layoffs are Cast Members with decades of service to the company. This week is seeing the dismantling of the vast majority of the Walt Disney World entertainment department.

Senator Warren has given the company until October 27 2020 for answers to her 7 questions.

Discuss on the Forums
Article Posted: Oct 14, 2020 / 4:09pm ET
View all comments →

TrainChasers1 hour ago

Are you talking about at the parks? Teenagers aren’t really the target market for beauty and the beast on stage. There should be a balance for everyone at a theme park. There will always be an audience for live shows, thrill rides, gentle rides, kids rides etc.

eliza61nyc2 hours ago

Oh absolutely. Movie theaters began suffering from that and now to same extent cable. Cable has gotten so expensive and with the new streaming options people are cutting the cord. One thing I will say is that the mouse people do exceptionally well is marketing. They've marketed their product to the point where it's almost a right of passage for parents to take their kids to Disney at least once. I think the next few years we will see Disney running lean and tight. It's going to take a while for anything in the entertainment business to bounce back. I'm a NYer. Broadway is in the toilet, the met opera house is contemplating shutting down and the list goes on jazz concerts, music fares, you name it. My company has already had 1 furlough, offered a nice buyout package to get a bunch of folks to jump ship AND the CEO has already said 2021 will not be pretty.

drizgirl2 hours ago

And when they're old enough to realize just how much a trip to Disney costs, and need to pay for it themselves, they might just decide that the screens they have at home already will be enough.

asianway2 hours ago

Pixie dust

eliza61nyc2 hours ago

I always look at it more as "different" than "sad". My kids aren't really into the live shows, they find them boring and chintz especially once they hit the teenage years. Today's consumer is different, with a generation that grew up pretty much "looking" at some type of screen, from video games to their phones for entertainment it doesn't surprise me that they don't see anything wrong with screen rides. People have been predicting the fall of Disney pretty much since this site open and yet it remains pretty popular. Maybe that's how it's supposed to be, us dinosaurs die out (stop going) and are replaced with a new generation of visitors. 🤷

Goofyernmost4 hours ago

If it reset how would they get the members to sign up for it? It seems like a non-negotiable item.

JoeCamel4 hours ago

I have always equated MBA's as the engineers of businesses. The engineers design and implement structure for projects and your task is similar. Being a Ravenclaw I understand the non-creative comment. I can't dream it up but give me an idea and I can expand and improve on it.

Mr Mindcrime5 hours ago

At first I disagreed with you but after pondering your comments a bit, I've sort of evolved in my thinking. My original belief is that if TWDC continues down the path of eliminating all of the "special little things" that elevated a trip to WDW to magical status, pretty soon it won't be magical, and thus on par with most any other entertainment option. Here is where I could be wrong (not saying I am wrong....but could be): today's world (i.e. younger consumers) are changing consumption habits. For instance, I would never want to watch a big college football game or concert or movie on a smart phone, while I'm doing something else. I want my big TV or a surround sound movie theater or stadium. So, with that said, it could be possible that all of the little special things that I like about visiting WDW may not be nearly as important to the new consumer. Maybe the new consumer is just perfectly happy with screen-rides and no live entertainment and less intensive theming, etc. If that's truly where TWDC is heading, then count me as sad.

Mr Mindcrime5 hours ago

I certainly don't take it personally. I'm not the stereotypical Wharton MBA. I agree with your comments 100%. I believe that MBA's have a place in the business world, but what most of them (us) don't have is an entrepreneurial gift. We're not sales-oriented. We're not creative. We're analysts focused on numbers and efficiencies. But, in my humble opinion, the totality of leadership is best served when you consider all functional areas of a business and not just the bottom line.

matt91126 hours ago

Just call it what it is selfish.

TrainChasers8 hours ago

At this point it would be great to have a ceo that has actually visited the parks out of a true desire and not just for a photo op!

flynnibus11 hours ago

I look at if the person has actually spent any time in the trenches actually doing what they are 'directing' Did you spend real time in sales... Did you spend real time in delivery... Did you spend real time in development/creation... If you go right from university... to one of the big consulting houses... to management. Then you fit the mold I am skeptical of.

TrainChasers11 hours ago

Yes. This. This should be required reading.

Sirwalterraleigh12 hours ago

...uh oh...thems fighting words!! 🤪 (Not to take sides...but I’m more Stanford, Princeton, Cal, Columbia school of thought than Harvard, Wharton, Chicago...But that’s a personal preference)