Furloughs Hit Disney Film Empire Amid Virus Crisis

Walt Disney Studios water tower - Getty - H 2020
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Notices went out Thursday, a week after its parent conglomerate said that those "whose jobs aren't necessary at this time" would be temporarily dismissed as of April 19.

Furloughs have hit Walt Disney Studios, Hollywood's sprawling movie empire. The expected notices, which impact an undetermined number of employees, were handed out Thursday, sources tell The Hollywood Reporter.

On April 2, parent company The Walt Disney Company stated that employees across the media and entertainment conglomerate whose "jobs aren't necessary at this time" would be furloughed as of April 19 due to the novel coronavirus pandemic. That was preceded by deep executive pay cuts disclosed on March 30.

Like its rivals, Disney Studios has seen much of its business come to a standstill amid unprecedented theater closures and delayed productions.

In terms of furloughs, sources say the marketing and distribution departments have been especially impacted. Disney's next release in cinemas is Mulan on July 24 (Pixar's Soul remains dated for June 19 but is widely expected to move from that date). The company didn't immediately respond for comment. 

Disney's film stable is Pixar, Lucasfilm, Marvel Studios, Disney's own live-action studio, Walt Disney Animation Studios, 20th Century and Searchlight.

Impacted workers will remain Disney employees through the duration of the furlough period. They will receive full health care benefits, plus the cost of employee and company premiums will be paid by Disney. And those enrolled in Disney Aspire will have continued access to the education program.

Additionally, employees with available paid time off can elect to use some or all of it at the start of the furlough period and, once furloughed, they are eligible to receive an extra $600 per week in federal compensation through the $2 trillion economic stimulus bill, as well as state unemployment insurance.

"The COVID-19 pandemic is having a devastating impact on our world with untold suffering and loss, and has required all of us to make sacrifices. Over the last few weeks, mandatory decrees from government officials have shut down a majority of our businesses. Disney employees have received full pay and benefits during this time, and we've committed to paying them through April 18, for a total of five additional weeks of compensation," the Walt Disney Co. said in its April 2 statement.

The conglomerate is more vulnerable than some of its rivals because of its shuttered theme park business.

Regarding the pay cuts disclosed on March 30, all vice presidents across the corporation, including at the film studio, will have their salaries reduced by 20 percent; senior vps by 25 percent; and executive vps and above by 30 percent. This includes Walt Disney Studios co-chairmen Alan Horn and Alan Bergman.