Disney to lay off 28,000 employees as COVID-19 pandemic continues to hurt its theme parks

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Walt Disney Company-Disneyland
Credits: Marivic Summers

The Walt Disney Company (NYSE: DIS) made a “heartbreaking” and “difficult” decision to layoff 28,000 employees as the COVID-19 pandemic continues to force the closure of its theme parks in the United States and overseas.

On Tuesday, Disney’s head of parks, Josh D’Amaro sent a memo to employees informing them about the company’s decisions. A majority, 67% of the 28,000 who will lose their jobs are part-time workers across the company’s parks, consumer products, and experiences division.

In the memo, D’Amaro wrote that the company did not expect that the COVID-19 pandemic will last for months and its impact on people’s daily lives and work would be so significant.

“We initially hoped that this situation would be short-lived and that we would recover quickly and return to normal. Seven months later, we find that has not been the case. And, as a result, today we are now forced to reduce the size of our team across executive, salaried, and hourly roles,” according to D’Amaro.

Mass lay off is the only “feasible” option for Disney amid the COVID-19 pandemic

He continued, “As you can imagine, a decision of this magnitude is not easy. For the last several months, our management team has worked tirelessly to avoid having to separate anyone from the company. We’ve cut expenses, suspended capital projects, furloughed our cast members while still paying benefits, and modified our operations to run as efficiently as possible, however, we simply cannot responsibly stay fully staffed while operating at such limited capacity.”

Furthermore, D’Amaro said Disney has no choice but to carry out the “heartbreaking” mass layoff because it is the only “feasible” option as the pandemic continues to hamper its business. Governments have required businesses to operate in a limited capacity and practice social distancing.

CNBC obtained and published a copy of D’Amaro’s memo to Disney employees.

Currently, Disney already reopened its theme parks in Florida, Hong Kong, Japan, Paris, and Shanghai. However, the theme parks are not yet operating normally as the company is still practicing requirements to prevent the spread of the novel coronavirus. The company’s California Adventure and Disneyland in Anaheim, California are still closed.

Many companies have plans or already laid off hundreds to thousands of workers since the COVID-19 pandemic began.

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