Class warfare is a thing at Disney theme parks. It’s not the one that you think, though. Over the past several years, your favorite corporation has battled its own employees. Cast members have wanted what we all want, a fair wage. The parties have pushed back and forth over what qualifies as fair. In 2018, Disney reached a turning point when they reached agreement on salaries with the majority of employees at both American parks. What does this mean for the future? Well…
The battle lines
I realize that this topic is uncomfortable for many people, especially the high number of cast members who kindly read our site and the unaffiliated Mickey Mouse fans who want to think the best of Disney. My goal here is to be fair to both sides, although I should say in advance that I believe that cast members are THE best employees in the world. If they were paid what NFL linebackers are, I would believe that amount is justified.
Keeping my admitted biases in mind, let’s talk about the recent turning point in Disney’s labor negotiations. Every few years, cast members and their employers agree to terms on a new deal. Historically, a few hiccups have occurred along the way, but the process is rarely combative. In 2017 and 2018, the knives came out as the two parties harbored a grudge for an extended period.
The debate lies in the definition of a fair working wage. I should preface this by discussing something crucial to the topic. Everyone dreams of working at Disney. Seriously, we are indoctrinated into this desire as kids. From the moment we fall in love with our first Disney character, we connect the dots that working at the Happiest Place on Earth would be a pleasant experience.
I know some extremely successful professionals who have confided in me that they fantasize about retiring from their jobs and moving to California/Georgia. Their dream involves working in the theme parks and making children and their families happy. It’s a pleasant fantasy since it’s so positive. The perception in our society is that theme parks are joyous places, and Disney is undeniably the best of them.
Given the appeal of this dream, Disney doesn’t have any trouble staffing their parks. To the contrary, they get their pick of employees for many jobs. The ongoing joke on some Disney forums is that people who want to work at Walt Disney World better learn how to drive a bus. The other jobs are too hard to get.
This lack of leverage is problematic for Disney workers. At the start of the conflict, Disney offered employees a paltry $10.25 an hour as a “raise.” In May of 2017, the living wage in the United States was $9.20. Disney officials probably didn’t expect an offer only 11 percent over the bare minimum to entice workers, many of whom were in labor unions. What they certainly didn’t anticipate was backlash.
The Walt Disney Company is largely above the fray in discussions of corporate malfeasance. Sure, they’ll take a knock from time to time over social politics, but even the most indifferent Disney analysts see the company as well-managed. Since they’re so rarely attacked over financial issues, executives frankly displayed a bit of arrogance with their negotiations. And it bit them.
Disney cast members had long decried the company’s draconian salary policies. In 2016, a couple of them did something unexpected but effective. They ran for Anaheim’s City Council, and they won. Disney may act above the law at their theme parks, but they are just as accountable to the government as anyone else. With hardliners in power, Disney faced unexpected turmoil during their negotiations. And then something tragic happened.
The price of housing around Disneyland is notoriously steep, and issues for the homeless of Anaheim are well-documented. The two depressing factors led to a tragedy no one could have anticipated. A worker failed to show up for work one day. Her friends started a search for her. A few days later, the police discovered that she had died in her car. She was living in it, and the vehicle was parked near the gym where the woman showered prior to work each day.
The tragic, senseless death of a cast member unable to afford basic housing became a rallying cry for cast members championing fair wages. They refused to cede to Disney’s demands in contract negotiations. The company even did something shady, a rarity for one of the classiest corporations on the planet.
Disney officials denied $1,000 bonuses that were promised to some workers until a new deal was ratified. To people making $10 an hour, a bonus of that size borders on life-changing, and Disney was 100 percent in the wrong to punish cast members that way. The uncharacteristic actions demonstrated how much pressure corporate executives felt on the subject of fair wages.
The truce
Within a three-week span, labor unions at Disneyland and Walt Disney World hammered out agreements during the summer of 2018. These deals were much more lucrative than the initial, borderline offensive offer of $10.25 an hour. Here’s what transpired and what led to the resolution.
I will start with a bit of math. $10 an hour for a full-time employee means an annual salary of $20,800. The average American household income during the summer of 2018 was $61,891. In Florida, the amount was a bit higher at $64,003. Anaheim is similar, with an average household income of $64,464.
A household in Orlando or Anaheim with two full-time Disney cast members would have earned $41,600. That’s more than $20,000 less than the national average and even worse for Floridians and Californians. And single people need at least two roommates to live as comfortably as the average American. You can see why cast members felt the need to take a stand.
In the wake of the heartbreaking story about the cast member who died in her car, the media took a hard look at the homeless problem around Disneyland. Stories like this one propagated across the internet. Then, the Anaheim City Council started resisting Disney in some unprecedented ways. One of them, tax incentive revocation, eventually led to the cancellation of the Downtown Disney hotel project.
Facing rare negative media over its business practices, Disney executives went back to the drawing board and proposed something new. They presented an olive branch to cast members in the form of a tiered wage increase plan. At Walt Disney World, employees currently earn $12 an hour, an improvement of 20 percent from 2016. More importantly, their hourly income will increase to $15 by 2021. Yes, cast members at Walt Disney World will enjoy 50 percent salary increases over a five-year period.
Anaheim cast members gained an even more advanced salary schedule. They started higher at $11 per hour and earned an instant 20 percent raise in the summer of 2018, which took their hourly pay to $13.25. At the start of 2019, that total jumped to $15 an hour and will increase again to $15.45 per hour in June of 2020.
For the first time in recent memory, Disney cast members can see a light of the tunnel, one where they will earn a living wage. Still, the numbers sound better than they are. At $15 an hour, a cast member will gross $31,200 a year. Even after the protracted negotiations and guaranteed salary increases, a two-person household will earn slightly less than the average Floridian or Californian. It’s a problem.
The good news for Disney employees is that recent events have revealed the pressure points in the company’s ecosystem. They’ve continued to push their bosses on the state of housing in California. Disney’s added a hotline that cast members may contact when they need a place to stay/live.
In other words, corporate officials are finally taking the matter seriously. Disney went so far as to donate $5 million to combat the homeless problem in Anaheim. That sounds great, and it is. However, I feel the need to mention that Disney earned just under $60 billion in fiscal 2018.
An extra dollar an hour in salary given to the 104,000 cast members at Disneyland and Walt Disney World is $216 million annually. The company would just need to make one more Marvel movie a year to counteract a $2.50 hourly pay raise to the dedicated professionals who make theme park visits magical. The amount of money that Disney has contested so passionately over the past few years is the equivalent of a Mickey Mouse backpack to you and me.
What both parties can and should do next
Disney and its theme park employees have already achieved the first, best step. They’ve kicked the can down the road for a time. Sure, this strategy generally sounds passive, but it’s not in this instance. The two parties understand that these negotiations become acrimonious when they’re argued through the media. Both sides tend to lose in such scenarios, too.
In the most recent standoff, Disney’s brand lost some of its luster as details leaked about the quality of life of some Disneyland workers. They were decidedly not happy working at the Happiest Place on Earth. Some of their complaints led to a groundswell of support for new city council representatives. That election cost the corporation the tax incentives needed for the Downtown Disney projects.
For cast members, their lack of leverage was readily apparent. They couldn’t even force arbitration for the $1,000 bonuses owed to many employees. Whether you like it or not, corporations hold the power in modern America. Since the demand is so high for employment at Disney theme parks, current workers are replaceable, even those who are terrific at their jobs. Their recent salary increases notwithstanding, cast members can only push back a certain amount before they lose leverage.
Since both groups have so much to lose, what they should do is readily apparent. Disney should become proactive in offering fair, not CHEAP, salaries to their workers. What they should take from the hostile negotiations of 2017-2018 is that their brand is more important than saving a few million. The amount of annual income under discussion is trivial to the bottom line of a company that had $59.43 billion in revenue in fiscal 2018. They have to be more protective of the brand and employ more common sense.
For cast members, the two-pronged attack that they used to get raises is the blueprint for future negotiations. They should leverage voting power to pressure Disney whenever possible. The change in the composition of Anaheim’s city council is at least somewhat responsible corporation’s willingness to offer a better deal to its employees.
At Walt Disney World, the battle is tougher since Disney has its own government, but they’re still bound by state and federal laws. A less corporate-friendly leadership group would benefit workers. For a more tangible impact, cast members should continue to press their bosses on the subject of living wages. The public relations stories, while horrible to read, left an indelible impression about the company’s lackluster treatment of its employees.
In a perfect world, both parties would realize that a positive working environment is best for everyone. Disney and its cast members would hammer out a long-term agreement akin to the one in place at Disneyland. These guaranteed salary escalators give workers confidence that they have a future in the theme park industry. And we’re all better when the parks are staffed with highly skilled and experienced professionals.
Cast members are wonderful people, and Disney is the best. I think I speak for all of us when I say that I hate when mom and dad fight. Let’s avoid this sort of labor unrest for a decade or two. Okay, Disney?
