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Disney to cut 1,000 IT jobs, Positions will be outsourced -- many workers may be rehired
By Sarah Hale Meitner | Sentinel Staff Writer, Posted May 13, 2005
Walt Disney Co. plans to cut about 1,000 information-technology jobs and outsource them to two other companies beginning in mid-July.
The long-anticipated cuts, outlined to employees on Thursday, affect one-third of the company's 3,000 IT jobs, which provide technical and network support at company offices in Orlando, Los Angeles and New York. The number of positions to be outsourced in Orlando is 230, according to a notice filed with the state.
Disney expects most of the company's workers to land jobs with Dallas-based Affiliated Computer Services Inc. or Armonk, N.Y.-based International Business Machines Corp. once contract negotiations are completed at the end of the month. But some may not.
Some employees, including those who work within the IT department but don't hold technical positions, may be offered jobs elsewhere within Disney or will be laid off, the company told workers. Others may be hired by ACS or IBM on a short-term basis, ranging from 90 days to 12 months, at which time they would be eligible for a severance package depending on their length of employment.
"This is not a mass layoff, by any account, but an employee transition," Megan Barnett, vice president of human resources with Disney, told local Disney IT workers during one of two information sessions held Thursday at Walt Disney World's Contemporary Resort to outline the changes. Other sessions were held in California and New York.
Disney officials at the company's corporate headquarters in Burbank, Calif., would not confirm the plans to outsource positions to ACS and IBM, saying in a written statement only that "certain back of house IT work will be shifted to two outside domestic vendors."
Dan Mattox, vice president of client services, told Orlando employees the company's IT positions would be split evenly between ACS and IBM. Client-service and telecom positions would be absorbed by ACS, while data-center and applications jobs would be handled by IBM.
He went on to provide details about the companies, both of which provide business-process and IT-outsourcing services for commercial clients worldwide.
Employees displayed little emotion during the meetings, though many asked questions on topics ranging from vacation schedules to start dates to health-insurance coverage.
Because contract negotiations are under way, Disney did not elaborate on how salaries, benefits and vacation time may change but said the goal is to negotiate comparable packages.
Barnett told employees that they would have the option of attending a series of meetings in June to meet their new employers and receive new-hire paperwork and benefits information.
The employees affected by the switch won't be asked to relocate, she added. Their Disney jobs are scheduled to be terminated on July 16. The ACS and IBM jobs would then take effect on July 17.
"You'll show up on Monday, same location, same responsibilities, different badge," Barnett told employees.
Representatives at ACS and IBM would not comment Thursday.
Barnett told employees that the company would release a formal announcement once the contract had been settled.
She and Mattox told employees that the job change is not bad news.
"You are in the IT business, but Disney is not," Mattox told them. "In the area of career development and training, both of these companies are very strong."
Added Barnett later: "Disney is an entertainment and hospitality company. These are technology companies. They offer training that we couldn't possibly supply."
Richard Verrier of the Sentinel staff contributed to this report from Los Angeles. Sarah Hale Meitner can be reached at 407-420-5718 or smeitner@orlandosentinel.com.
By Sarah Hale Meitner | Sentinel Staff Writer, Posted May 13, 2005
Walt Disney Co. plans to cut about 1,000 information-technology jobs and outsource them to two other companies beginning in mid-July.
The long-anticipated cuts, outlined to employees on Thursday, affect one-third of the company's 3,000 IT jobs, which provide technical and network support at company offices in Orlando, Los Angeles and New York. The number of positions to be outsourced in Orlando is 230, according to a notice filed with the state.
Disney expects most of the company's workers to land jobs with Dallas-based Affiliated Computer Services Inc. or Armonk, N.Y.-based International Business Machines Corp. once contract negotiations are completed at the end of the month. But some may not.
Some employees, including those who work within the IT department but don't hold technical positions, may be offered jobs elsewhere within Disney or will be laid off, the company told workers. Others may be hired by ACS or IBM on a short-term basis, ranging from 90 days to 12 months, at which time they would be eligible for a severance package depending on their length of employment.
"This is not a mass layoff, by any account, but an employee transition," Megan Barnett, vice president of human resources with Disney, told local Disney IT workers during one of two information sessions held Thursday at Walt Disney World's Contemporary Resort to outline the changes. Other sessions were held in California and New York.
Disney officials at the company's corporate headquarters in Burbank, Calif., would not confirm the plans to outsource positions to ACS and IBM, saying in a written statement only that "certain back of house IT work will be shifted to two outside domestic vendors."
Dan Mattox, vice president of client services, told Orlando employees the company's IT positions would be split evenly between ACS and IBM. Client-service and telecom positions would be absorbed by ACS, while data-center and applications jobs would be handled by IBM.
He went on to provide details about the companies, both of which provide business-process and IT-outsourcing services for commercial clients worldwide.
Employees displayed little emotion during the meetings, though many asked questions on topics ranging from vacation schedules to start dates to health-insurance coverage.
Because contract negotiations are under way, Disney did not elaborate on how salaries, benefits and vacation time may change but said the goal is to negotiate comparable packages.
Barnett told employees that they would have the option of attending a series of meetings in June to meet their new employers and receive new-hire paperwork and benefits information.
The employees affected by the switch won't be asked to relocate, she added. Their Disney jobs are scheduled to be terminated on July 16. The ACS and IBM jobs would then take effect on July 17.
"You'll show up on Monday, same location, same responsibilities, different badge," Barnett told employees.
Representatives at ACS and IBM would not comment Thursday.
Barnett told employees that the company would release a formal announcement once the contract had been settled.
She and Mattox told employees that the job change is not bad news.
"You are in the IT business, but Disney is not," Mattox told them. "In the area of career development and training, both of these companies are very strong."
Added Barnett later: "Disney is an entertainment and hospitality company. These are technology companies. They offer training that we couldn't possibly supply."
Richard Verrier of the Sentinel staff contributed to this report from Los Angeles. Sarah Hale Meitner can be reached at 407-420-5718 or smeitner@orlandosentinel.com.
