Will Disney layoffs, hiring freeze affect Disney World?

Layoffs and a hiring freeze are coming within the Walt Disney Co. soon, according to a memo from Disney CEO Bob Chapek, but it is unclear if Walt Disney World will be affected by the cutbacks.

One union leader, Unite Here Local 362 President Eric Clinton, said Monday he has not heard anything from Disney World about the hiring freeze or layoffs and he does not think they will happen at the Orlando theme park at this point.

Chapek’s memo, sent internally to Disney division executives Friday, said the company is looking to reduce its workforce through a companywide cost-cutting initiative. His note did not say where these layoffs are expected to take place.

“We will look at every avenue of operations and labor to find savings, and we do anticipate some staff reductions as part of this review,” he wrote, according to a copy of the memo first obtained by Variety.

He also announced a “targeted hiring freeze” for all roles but “the most critical, business-driving positions” and said executives would be individually notified of the impacts to their teams.

“I am fully aware this will be a difficult process for many of you and your teams,” he wrote to Disney leaders. “We are going to have to make tough and uncomfortable decisions. But that is just what leadership requires, and I thank you in advance for stepping up during this important time.”

Disney employs about 190,000 people across the company’s entertainment and theme parks divisions, according to its most recent financial filings.

About 70,000 of those employees work at Walt Disney World in Orlando, one of the largest single-site employers in the country.

Representatives for Disney’s corporate office and Disney World did not respond to a request for comment Monday.

Unite Here Local 362, which represents workers in roles such as attractions, custodial and vacation planning, has seen new people hired into these roles recently, Clinton said. Additionally, its contract with Disney requires the company to give workers notice of layoffs one week in advance, and employees have layoff protections based on seniority.

Filings with the Florida Department of Economic Opportunity show Disney has not provided the state with advance notice of mass layoffs. Under state law, companies are required to provide notice of such actions 60 days ahead of time.

Disney is currently renegotiating its contracts with the unions representing Disney World’s workers. It has proposed to raise employee pay to $20 an hour over the next five years as part of that bargaining, but workers say that is not enough as many struggle to make ends meet with the current $15 minimum hourly wage.

Chapek’s memo comes after Disney’s fourth quarter and year-end earnings call, which reported record annual revenue of $28.7 billion in the company’s theme parks division but significant losses in streaming services. During the Nov. 8 call, CFO Christine McCarthy said the company was “actively evaluating [its] cost base” and “looking for meaningful efficiencies.”

Disney stock plunged to $86.75 after the call. That was just 99 cents above the stock price on March 23, 2020, days after the company announced it was shutting down its theme parks due to the COVID-19 pandemic.

News of staffing reductions and the hiring freeze comes as Disney, like other theme park companies, has faced staffing issues in recent months.

In May, Chapek said the company has not had “too big an issue” attracting or retaining theme park employees, but McCarthy said Disney was dealing with “rising wages” and a “tighter labor market.”

An Orlando Sentinel report found staffing at Disney World and Orlando’s other theme parks trailed pre-COVID employment numbers as the busy summer season started.