Appellate Court Rules Disney Failed To Pay 25,000 Employees Minimum Wage
A California state appeals court ruled Thursday that the Walt Disney Company has failed to pay 25,000 employees the minimum wages mandated by voters in Anaheim.
While California’s minimum wage is $15.50 an hour, a number of local governments in the state have mandated higher wages. One of these local governments is Anaheim, which set wages at $15 an hour beginning in 2019, with increases of $1 a year until 2023. Further raises my also be implemented based on inflation.
The caveat in the Anaheim law is that the wage requirements only apply to employers who get city subsidies such as tax rebates.
In the lawsuit, Disney argued that it was not receiving any subsidies from Anaheim and was thus exempt from the law.
The dispute in the case involved a 1996 court agreement between Disney and Anaheim which saw the city issued 400 million in construction bonds. This total included $200 million for Disney’s construction of Disney’s California Adventure an a parking garage. The bonds were to be financed by taxes on hotel guests, sales taxes on local consumers, and Disney’s property taxes.
As part of the agreement, the city and the company agreed that if the city’s tax revenues were not enough to pay its share of the bonds in any year, DIsney would make up the difference, and then would be reimbursed by Anaheim when its tax revenues increased.
In 2021, Orange County Superior Court Judge William Claster ruled that Disney, while gaining a “significant benefit” from the project, was not receiving any subsidy from Anaheim.
Appellate Court Overturns 2021 Ruling
Thursday however, an appellate court disagreed. As part of the 3-0 ruling, Justice Eileen Moore said that even if Disney was just recovering funds it had previously paid to Anaheim, the company “received a city subsidy”.
The original class action lawsuit was filed on behalf of 25,000 Disney employees. The employees are seeking an increase in their minimum wage and damages for lost wages.
Following the ruling, Richard McCracken, an attorney for the employees, said the court “has carried out the intentions of Anaheim voters.”
“Disney’s resistance has been based on the most hyper-technical legalisms about whether it had an agreement with the city for a rebate of its taxes,” McCracken said in an email to The San Fransisco Chronicle. “Now the only question is how much longer Disney will string this out in order to avoid paying its employees what the law requires.”
Thanks for visiting MickeyBlog.com! Want to go to Disney? For a FREE quote on your next Disney vacation, please fill out the form below and one of the agents from MickeyTravels, a Diamond level Authorized Disney Vacation Planner, will be in touch soon! Also, thanks for reading!