Disney in COVID-19 trouble?

Disney announced today, Tuesday, September 29, 2020, it will be laying off 28,000 employees at both its Disneyland and Walter Disney World parks in the United States. This information was disseminated to employees via a letter from Disney Parks Chairman Josh D’Amaro.

The layoffs will occur at Disney’s theme parks, cruise lines, and travel planning and consumer products division.

“In light of the prolonged impact of COVID-19 on our business, including limited capacity due to physical distancing requirements and the continued uncertainty regarding the duration of the pandemic — exacerbated in California by the State’s unwillingness to lift restrictions that would allow Disneyland to reopen — we have made the very difficult decision to begin the process of reducing our workforce at our Parks, Experiences and Products segment at all levels, having kept non-working Cast Members on furlough since April, while paying healthcare benefits,” D’Amaro said in a statement.

Disneyland in Anaheim and Disney California Adventure has been closed for 6 months now since mid-March. Disney theme parks in China, France, Japan and Florida have reopened with attendance capacity limits following extended coronavirus closures.

“We initially hoped that this situation would be short-lived, and that we would recover quickly and return to normal,” D’Amaro said in a letter to employees. “Seven months later, we find that has not been the case. And, as a result, today we are now forced to reduce the size of our team across executive, salaried and hourly roles.”

According to D’Amaro, Disney theme parks have cut expenses, suspended capital projects, furloughed employees with benefits and modified operations in an effort to avoid layoffs.

“As you can imagine, a decision of this magnitude is not easy,” D’Amaro said in a letter to employees. “However, we simply cannot responsibly stay fully staffed while operating at such limited capacity.”

About two-thirds of the 28,000 laid off employees are part-time workers. D’Amaro said Disney will look for opportunities to bring back the laid off employees at a later date.

“As difficult as this decision is today, we believe that the steps we are taking will enable us to emerge a more effective and efficient operation when we return to normal,” said D’Amaro, chairman of Disney’s Parks, Experiences and Products division. “As heartbreaking as it is to take this action, this is the only feasible option we have in light of the prolonged impact of COVID-19 on our business.”

Disneyland and Disney World will schedule appointments with laid-off salaried and non-union hourly employees over the next few days and begin discussing next steps with unions.

“The heart and soul of our business is and always will be people,” D’Amaro said in a letter to employees. “Just like all of you, I love what I do. I also love being surrounded by people who think about their roles as more than jobs, but as opportunities to be a part of something special, something different, and something truly magical.”

Disney employs more than 100,000 at its U.S. theme parks — 32,000 at Disneyland and 77,000 at Disney World. Disney did not disclose how the 28,000 layoffs would be distributed between Anaheim and Florida. Disneyland and DCA have been closed for nearly seven months. Disney World’s four theme parks reopened in July.

California theme parks have been left waiting on the sidelines while other segments of the economy have reopened under Gov. Gavin Newsom’s four-tier Blueprint for a Safer Economy.

A growing chorus of theme parks, city leaders, state lawmakers and industry associations have called on Newsom to reopen Disneyland, Universal Studios Hollywood, Knott’s, Six Flags Magic Mountain, SeaWorld San Diego, Legoland California and other amusement parks throughout the state.

Newsom said a month ago that he would announce a reopening plan for California theme parks “soon” and said two weeks ago that guidelines would be coming “very, very shortly.”