Disney Agrees To Over $200 Million Settlement

Disney has agreed to a settlement of $233 million related to a class-action lawsuit over wage discrepancies.

At a Glance

The Walt Disney Co. has agreed to pay $233 million to settle a class-action lawsuit with Disneyland workers.
Over 50,000 current and former employees will receive back pay with interest, if the settlement is approved.
The settlement covers wages from January 1, 2019, when Anaheim’s $15-an-hour minimum wage law took effect
A California state judge will review the settlement on January 17.
Disney now pays a minimum of $19.90 per hour, with 95% of workers earning above this rate.

Disney’s Massive Settlement for Wage Violations

The Walt Disney Co. has agreed to pay $233 million to settle a class-action lawsuit filed by Disneyland workers over minimum wage violations. This settlement, thought to be the biggest wage and hour class settlement in California history, is poised to provide back pay with interest to over 50,000 current and former employees of Disney’s Anaheim theme parks.

The lawsuit, filed in December 2019, accused Disney of failing to comply with Anaheim’s Measure L, which mandates a minimum wage of at least $20 an hour for businesses receiving city subsidies, with a 2% annual raise. The dispute began in February 2018 after a survey revealed Disney workers struggled to meet basic expenses.

Legal Battle and Disney’s Response

Disney initially argued that it did not receive city subsidies and was therefore not obligated to comply with Measure L. However, a court ruling identified a 1996 agreement as a subsidy, requiring Disney to adhere to the law. The company had received approximately $200 million in tax rebates for construction projects.

“We are pleased that this matter is nearing resolution. Currently, all cast members make at least the Measure L requirement of $19.90 per hour, and in fact, 95% of them make more,” Disneyland spokesperson Suzi Brown stated.

Despite Disney’s claims of compliance, the settlement covers back pay from January 1, 2019, when Anaheim’s $15-an-hour minimum wage law took effect. The company will also pay penalties, interest, and other fees as part of the agreement.

Impact on Workers and Future Implications

The settlement’s impact on Disneyland employees is expected to be significant. Randy Renick, an attorney for the workers, stated, “What we believe is the largest wage and hour class settlement in California history will change lives for Disney families and their communities.”

In July, Disney agreed to a new contract raising the minimum wage for unionized workers at Disneyland to $24 an hour. This settlement, along with the recent wage increases, marks a significant shift in Disney’s labor practices and could have broader implications for wage enforcement across California.

A California state judge will review the settlement on January 17, and if approved, employees will be notified of their individual compensation. This case serves as a reminder of the importance of adhering to local wage laws and the potential consequences for companies that fail to do so.