Disney World’s army of cast members turn their backs on a $1-an-hour raise.
Walt Disney Company
Heading into Disney’s first-quarter earnings call on Wednesday afternoon, the company has labor pains. Unionized theme park workers have rejected a five-year contract “best offer” after more than six months of negotiations, saying that the company’s proposed $1-an-hour-per-year raise is not enough.
This afternoon, the entertainment giant will report quarterly earnings for the first time since its board of directors abruptly fired former CEO Bob Chapek and reinstated Bob Iger to its helm. Iger is expected to tout theme parks attendance and a strong box office for the Avatar sequel as recent success stories.
Theme parks remain Disney’s golden goose. In fiscal year 2022, Disney’s parks division raked in $7.9 billion in operating profit, compared to a loss of about $4 billion for its streaming unit.
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“Certainly, that the parks division is doing well aids our claim that what makes those parks so successful is our cast members [a term encompassing all Disney workers]who make sure the rides run safely, the parks are clean, the hotel rooms are ready when the guests arrive and the food is cooked and served appropriately,” says Eric Clinton, president of Unite Here, Local 362, whose members include attractions workers who run rides, custodial workers, and ticket sellers at the parks.
Local 362 is one of six unions in the Service Trades Council Union (STCU), a consortium representing about 32,000 of Walt Disney World’s workers at the flagship Florida theme park resort. Along with Local 362’s members, the STCU includes costumed characters and bus drivers to hotel housekeepers, restaurant and shop employees, and more.
In a vote last week, about 96% of STCU members rejected Disney’s proposed contract. So next week, Disney will be heading back to the bargaining table over workers’ wages at its flagship Orlando resort. Disney did not respond immediately to a request for comment.
The minimum starting wage for Disney workers is currently $15, significantly higher than Florida’s state minimum wage of $11, which will rise to $12 in September.
Clinton notes that the last contract was ratified in 2018 after a year of negotiations. “We didn’t know the pandemic was coming or what inflation would be what it was in 2022,” he says.
Disney’s offer would have brought the company’s minimum wage to $16 an hour, with most union members to at least $20 an hour by 2026. The proposal also included eight weeks of paid family leave and an additional 401k plan.
Union members are demanding a starting minimum wage of $18 an hour and a $1-an-hour raise in every year moving forward.
The union points to a very recent precedent for its current ask. Last month, food service workers at Orlando’s Orange County Convention Center reached an agreement that jacked the minimum wage from $13 to $18 an hour and added a pension plan.
“This has never been about ‘does Disney have enough to pay their employees?’ They basically print money here,” Clinton says, pointing out that, for someone earning $15 an hour, a $1-an-hour increase equates to a 6.5% increase.
“In 2022, inflation was much more than that. And so I don’t understand how Disney thinks it’s okay, in the face of all the money they’re making off the parks division, to expect the lowest-paid cast members to take a cut,” says Clinton. “Nobody’s working at Disney to get rich, just to be able to live a meaningful life. I think that’s all that people are asking for.”
Analysts estimate that Disney’s theme park segment should report a Q1 revenue bump of 12% and an operating earnings up about 8%.
Disney’s share price is up 15% since the announcement of Bob Iger’s return to CEO, and up 26% since the start of 2023.
