Senator Warren slams Disney for layoffs, executives’ salaries

In this news, we discuss the Senator Warren slams Disney for layoffs, executives’ salaries.

NEW YORK (Reuters) – U.S. Senator Elizabeth Warren has slammed Walt Disney Co’s DIS.N decision to lay off 28,000 workers while making payments to shareholders in the years leading up to the COVID-19 pandemic, demanding more information from company executives on the measures.

Warren, a former progressive US presidential candidate, criticized the entertainment company for the layoffs that took place as Disney allegedly reinstated the salaries of some executives who had suffered cuts due to the pandemic, according to a letter the Massachusetts senator sent to Disney on Tuesday and seen by Reuters.

Warren described Disney’s decision to pay dividends and buy back shares before the pandemic as “short-sighted” because it cut capital the company could have used to weather the downturn.

“I would like to know if Disney’s financial decisions have had an impact on the company’s decision to lay off workers,” Warren wrote. “It appears that – before and during the pandemic – Disney took good care of its executives and shareholders – and is now in the process of hanging its frontline employees to dry off.

Disney did not immediately provide a comment. Warren said she appreciated that Disney continued to provide health care benefits to workers on leave for the past six months.

Third Point hedge fund activist investor Daniel Loeb said the company should end its dividend for good, after Disney suspended it in May, and invest in streaming programming instead.

About two-thirds of Disney’s 28,000 workers said last month they were laying off part-time. Disneyland, the company’s theme park in California, remains closed due to the pandemic.

Abigail Disney, the granddaughter of Disney co-founder Roy Disney, also criticized the company for the way it has handled the pandemic.

Warren targets leaders who come under increasing scrutiny as the economy falters due to the pandemic and workers and other elected officials insist them on issues such as racial justice and climate change .

Last month, she criticized CEOs for failing to deliver on the Business Roundtable-backed commitment to put social responsibility above shareholder profits.

Reporting by Jessica DiNapoli in New York; Additional reporting by Lisa Richwine; Editing by Muralikumar Anantharaman

Original © Thomson Reuters

Originally posted 2020-10-14 04:16:10.

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