Disney to Buy out 600 Amusement park execs

[TheBeadPirate]

Just heard on CNBC... Disney to buy out 600 Amusement park execs... is this the start of outsourcing the parks?

 

[TheBeadPirate]

Meanwhile, The Wall Street Journal reported this afternoon that Walt Disney is offering buyout packages to about 600 executives at the company's domestic resorts and parks unit. Employees have until Feb. 6 to accept the buyouts, according to the Journal.

 

[zulemara]

I"m vigorously searching for a link. This needs to be moved to the main board, it's not a rumor!

 

[crazy4wdw]

I"m vigorously searching for a link. This needs to be moved to the main board, it's not a rumor!

http://www.foxbusiness.com/story/ma...sney-offering-buyouts--execs-resort-unit-wsj/

 

[Horace Horsecollar]

I"m vigorously searching for a link. This needs to be moved to the main board, it's not a rumor!

In addition to the link that crazy4wdw posted, here's a link to the Orlando Sentinel story, with an Orlando perspective: http://www.orlandosentinel.com/news...isney-executive-layout-012109,0,3302228.story

This is the "Disney Rumors and News" forum, so this is the right forum for this news.

Keep in mind that a "buyout offer" to 600 executives foes not mean that 600 executives will depart. It's likely that the majority of those receiving the offer will not accept it. The people who are likely to accept it are those who are nearing retirement (and see this as an opportunity to retire a bit sooner) and those who think they'll have no trouble getting a good executive job elsewhere (which is difficult in this economy).

 

[crazy4wdw]

From CNBC:

The Magic Kingdom Offers Buyouts
Posted By: Julia Boorstin

The happiest place on earth is the latest company to try to cut back on overhead costs.

Disney's theme park division is offering buyouts to roughly 600 executives at its U.S. parks — that's nearly every executive in the division.

Disney says it’s trying to reduce the size of its executive workforce but says it has no target number of buyouts (or savings) and says it can't predict how many people will accept the buyout.

The executives have until February 6th to decide.

The parks are clearly facing the impact of the pullback in consumer spending—i.e. lower traffic and spending—and are trying to prepare. Leslie Goodman, EVP Worldwide Public Affairs for Walt Disney Parks and Resorts released a statement: "The Parks and resorts division is in the process of implementing a number of initiatives to contain costs and maximize efficiency.... Given the continued uncertainty of the economic environment, we must manage our business even more productively."

I got a look at the letter detailing the "Voluntary Separation Plan" offer—it includes "severance incentives, extended benefits and outplacement services." This buyout is going to be pricey enough that Disney's got to be looking to reduce its executive overhead for the long-term.

Unlike some other companies, which are announcing company-wide layoffs, Disney's individual divisions are announcing their layoffs and buyout plans independently. I'd expect to hear from more of the divisions over the next couple weeks.

And Disney is hardly alone.

Just this Tuesday Warner Bros. announced it's laying off 800 people, or 10 percent of its workforce. The same day broadcasting company Clear Channel Communications cut 1,850 jobs, about nine percent of its workforce. And I'm sure we'll hear more news of similar moves at other companies.

 

[Peter Pirate 2]

If only they could buyout Iger.

 

[doconeill]

Lopping off execs isn't a sign of outsourcing in general - execs don't like to outsource their own jobs...

This is a fairly common practice when an organization gets too top heavy. I'm surprised at the number of offers, but there could be limitations that are not announced - like they will only grant 10% of the total offers, and if there was more than 10% accepted, tie breaker rules like seniority apply.

 

[Mickmse2002]

Part of the consideration in these offers is that emplotyers cannot be "selective" in who they make an early buyout offer to avoid any discrimination claims. You have to offer it to all eligible employees based on the criteria established in the program. Therefore, 600 doesn't seem all that large a number.

 

[M-I-C-K-E-Y]

This simply sounds like an "early out" option. It's quite common with governmental agencies...and - no doubt - in the private sector.

 

[smatterchu]

Part of the consideration in these offers is that emplotyers cannot be "selective" in who they make an early buyout offer to avoid any discrimination claims. You have to offer it to all eligible employees based on the criteria established in the program. Therefore, 600 doesn't seem all that large a number.

You make a very good point -- especially if they didn't want all 600 to take the offer...like they were banking on maybe a certain percentage of acceptance or something..... I hadn't considered this, but I'll bet you are right...