Disney furloughs employees ‘whose jobs aren’t necessary at this time’

Facing a complete standstill across its entertainment empire due to the coronavirus crisis, the Walt Disney Company notified its employees that it would furlough employees “whose jobs aren’t necessary at this time” starting on April 19th.

Disney has been crippled by the coronavirus pandemic. Its theme parks around the world have shuttered, its cruise line is suspended and many of its biggest films of the year have been delayed. Live sporting events, the lifeblood of the Disney-owned ESPN, have also been suspended. Shares of Disney have plummeted more than 30% year to date.

The impact is hitting Disney’s theme park employees especially hard. All of Disney’s twelve theme parks have been shuttered since March 15th, after which the company committed to paying salaries through April 18th. In the statement, the company said there was “no clear indication of when we can restart our businesses,” and that it was “forced to make the difficult decision to take the next step and furlough employees.” More than 75% of the company’s 223,000 employees work for the Parks and Products division.

The furloughed workers would remain employees of the company and keep their health and education benefits, while also being able to access federal and state aid like unemployment benefits. Among those impacted could be the Disney Parks’ storied “Imagineers” — the designers of the parks, rides and hotels.

Disney’s announcement is one of the signs of the economic destruction rippling through the travel industry, which employs some 319 million workers globally.

Disney executives announced earlier this week that they were taking a pay cut because of the pandemic. The company’s CEO Bob Chapek said in an email to employees on Monday that he would take a 50% pay cut while Bob Iger, the company’s executive chairman, will forgo all of his salary.

“While I am confident we will get through this challenging period together and emerge even stronger, we must take necessary steps to manage the short and long-term financial impact on our company,” Chapek wrote.

Thursday’s furlough announcement specifically relates to the company’s US employees, executives, and non-union hourly workers.

-— This story previously misstated the date on which all Disney parks closed. It has been corrected.