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Disney to begin first of 3 layoff rounds this week, CEO says

Orlando Sentinel logoOrlando Sentinel 3/27/2023 Katie Rice, Orlando Sentinel

Disney is starting the first of three waves of layoffs this week as part of its plan to cut 7,000 jobs across the company, according to a memo CEO Bob Iger sent to employees Monday.

The memo, first obtained by Deadline, does not say who will be losing their jobs or where they work, so it remains unclear who could be on the list at Disney’s Florida offices.

It also doesn’t disclose how many people Disney will let go this week. Managers will notify affected workers “over the next four days,” Iger wrote.

Disney will conduct a “second, larger round” of layoffs in April. Without disclosing specifics, Iger said the April job cuts will affect several thousand more workers.

The final layoffs will take place before the summer “to reach our 7,000-job target,” he said.

Disney is reportedly looking to lay off 4,000 people as a cost-cutting measure, according to a Business Insider report. The remaining 3,000 cuts are expected to come from open positions that will be eliminated, an unidentified source familiar with Disney’s decision told the publication.

Iger’s memo did not confirm that, nor did it describe if severance packages were being offered. Former CEO Bob Chapek, who was ousted from Disney in November, received a severance package of nearly $20 million.

“In tough moments, we must always do what is required to ensure Disney can continue delivering exceptional entertainment to audiences and guests around the world – now, and long into the future,” Iger wrote. “Please know that our HR partners and leaders are committed to creating a supportive and smooth process every step of the way.”

It remains a mystery how many Disney jobs in Florida could be affected.

But the company has not filed any mass layoff notices with the state as of Monday, records show. Federal law requires companies to file these notices 60 days ahead of layoffs affecting 50 or more workers.

Disney World’s hourly frontline theme park workers are protected from layoffs by the union’s contract with the company, Unite Here Local 362 President Eric Clinton has said. These workers are among Disney’s lowest-paid, though employees reached a tentative deal with Disney World last week to bring the resort’s minimum wage from $15 to $18 this year.

During a February earnings call, Iger said the job cuts form part of Disney’s efforts to trim $5.5 billion in costs. CFO Christine McCarthy said labor cuts make up about $1.5 billion of that.

Disney made $82.7 billion in revenue during its 2022 fiscal year. The 7,000 jobs are around 3% of Disney’s global workforce of around 220,000 in October.

Iger’s Monday memo said the cost-cutting is “necessary for creating a more effective, coordinated and streamlined approach to our business.”

Deadline reported the layoffs will likely take place within all three of Disney’s recently restructured divisions, Parks, Experiences and Products, Entertainment and ESPN. Disney’s Entertainment division is anticipated to have “significant cuts” at Hulu, ABC Signature and 20th Television, according to the publication.

“The difficult reality of many colleagues and friends leaving Disney is not something we take lightly,” Iger wrote Monday. “... I want to offer my sincere thanks and appreciation to every departing employee for your numerous contributions and your devotion to this beloved company.

“For our employees who aren’t impacted, I want to acknowledge that there will no doubt be challenges ahead as we continue building the structures and functions that will enable us to be successful moving forward,” his memo continued. “I ask for your continued understanding and collaboration during this time.” and @katievrice on Twitter

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