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Disney settles state’s largest wage theft case
While Friday at Disneyland included winter parades, holiday makeovers for several rides and other seasonal delights, parent Walt Disney Co. was not in as jolly a mood.
The company quietly agreed to settle a wage theft class-action lawsuit for $233 million brought about by Disneyland workers five years earlier.
Those employees alleged Disney ignored Anaheim’s minimum wage law and they fought for back pay with interest. This agreement is taking placing just as Anaheim is set to increase minimum wages to nearly $20.50 an hour in the new year.
“What we believe is the largest wage and hour class settlement in California history will change lives for Disney families and their communities,” said Randy Renick, an attorney representing the workers in the class-action suit.
Who is affected?
My colleague Gabriel San Román detailed the settlement and the circumstances that led to the historic payout.
The settlement covers more than 50,000 current and former Disney employees.
Back pay is owed to workers from Jan. 1, 2019, when the wage law first took effect, until the date Disney adjusted wages at the end of the court fight last year. That accounts for roughly $105 million of the total settlement.
Orange County Superior Court Judge William Claster is set to review the settlement Jan. 17. Once approved, a notice will go to every worker regarding how much money they will receive.
“The company has been stiffing … workers for several years,” said Peter Dreier, a professor of public policy at Occidental College and co-author of “Working for the Mouse: A Survey of Disneyland Resort Employees.”
“They’ve denied them the back pay they’re owed while paying CEO Bob Iger over $31 million a year. It’s only fair that workers get what’s coming to them. And if the world were fair, Iger would take some of it out of his paycheck,” he said.
As part of the tabulation, Disney agreed to substantial penalties, interest and other associated fees on top of the back pay owed.
The origins of the struggle
The dispute between Disney and its workers dates from February 2018, when the Coalition of Resort Labor Unions released the “Working for the Mouse” survey.
The study was co-authored by Dreier and Daniel Fleming and detailed economic hardships faced by Disney workers at the time, including the finding that almost three-quarters of those surveyed said they didn’t earn enough money to cover basic expenses.
The report’s release arrived in tandem with a “living wage” ballot initiative campaign championed by the union coalition.
Anaheim voters approved Measure L, as the wage law is known, that year.
Starting Jan. 1, 2019, it ordered a minimum wage of $15 an hour for companies in the Anaheim Resort that enjoyed “tax rebate” agreements with the city.
Disney did not adjust wages in accordance with the law while negotiating pay raises with individual theme park unions and union councils.
In response, Disney workers filed a class-action lawsuit in December 2019 that represented 25,000 employees and alleged that the company illegally evaded the wage law.
Back-and-forth legal rulings
Disney’s attorneys argued that it did not have “tax rebate” agreements with Anaheim and wasn’t subject to the terms of the law.
At the company’s insistence, the Anaheim City Council tore up a 45-year gate tax moratorium and a $267-million bed tax agreement for a planned luxury hotel at Downtown Disney before the election.
Judge Claster initially agreed with Disney in 2021.
But the 4th District Court of Appeal reversed the ruling because a tax rebate agreement was embedded within a 1996 Disney expansion deal passed by the Anaheim City Council.
Disney appealed the decision, but the California Supreme Court declined to hear the case, which effectively ended its legal fight.
For more on the lawsuit and employee reaction, check out the full article.
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Column One
Column One is The Times’ home for narrative and long-form journalism. Here’s a great piece from this week:
(Uncredited / Associated Press)
When Luigi Mangione was arrested in the killing of the chief executive of UnitedHealthcare, he was hailed in some corners of the internet as an anti-capitalist folk hero. In a document said to be a “manifesto” found with Mangione, published online by journalist Ken Klippenstein, the 26-year-old former data engineer condemned UnitedHealthcare for abusing “our country for immense profit.”
More great reads
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For your weekend
(Illustrations by Lindsey Made This; photograph by Pamela Littky / Paramount+)
Going out
Staying in
L.A. Affairs
Get wrapped up in tantalizing stories about dating, relationships and marriage.
*L.A. Affairs is off this week. Here is one of our favorites from earlier this year.
(Ciara Hart / For The Times)
At 77, she had given up. She had two failed marriages and accepted that she would be single for the rest of her life. Then she fell in love with the estranged widower of her best friend, who was kind and caring. They spend an afternoon at a nursery of laughing and picking out plants. Would those seeds help germinate a relationship or will budding optimism wilt?
Have a great weekend, from the Essential California team
Andrew J. Campa, reporter
Carlos Lozano, news editor
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