A lawsuit claiming Disneyland employees do not earn a living wage can move forward after an Orange County Superior Court decision to certify it as a class action.
The lawsuit filed in 2019 on behalf of five resort workers alleges the Walt Disney Co. violated Measure L, which requires Anaheim resort businesses that receive tax subsidies and their subcontractors to pay employees a living wage. At the time, that was $15 an hour, and now it’s $17. Unite Here Local 11 and other unions representing Disneyland employees backed the measure.
It took 1½ years for the judge to allow the case to proceed as a class action. Many of the workers are employed by Disney. Others work for contractors such as Sodexo and SodexoMagic, which operate restaurants and coffee shops in the resort.
Attorney Randy Renick, who represents the workers, said Monday that he couldn’t disclose exactly how many employees comprise the class, but placed it in the thousands.
“I think the issues here are simple: The voters demanded that companies like Disney, who take public handouts, pay their workers a living wage,” Renick said. “Disney should not get a pass.”
Voters approved Measure L in 2018, requiring resort businesses that receive a city subsidy to pay at least $15 an hour. Under the ordinance, the minimum rises by $1 an hour each year until 2022, when it reaches $18. Raises will then be based on the cost-of-living index.
In the lawsuit, the Disney workers contend that Anaheim is using tax dollars to pay off construction bonds for the Mickey and Friends parking garage. Most of the taxes come from Disney, while the rest comes from hotel bed taxes. The lawsuit asserts that Disney keeps revenue from the parking garage and will own it once construction costs are paid back.
“All this was paid for with what Disney would have otherwise paid in taxes,” the lawsuit claims. “The money Anaheim gave Disney was raised by the issuance of municipal bonds. The bonds are repaid with and secured by Disney taxes.
“Instead of going to the City for general purposes, almost all of Disney’s transient occupancy, sales and real property taxes go to payments on the bonds, which will not be paid off until 2036. Disney got a rebate of the best kind: it got its taxes back before it paid them.”
Disney and Anaheim contend that the parking garage agreement does not constitute as a subsidy under Measure L.
Anaheim City Atty. Robert Fabela said in 2018 that “although there are many moving parts to the bond transaction, it does not appear to incorporate a direct city subsidy.”
A Disney spokesperson said the company agrees with Fabela.
“We continue to hold that the public-private partnership of the 1990s with the city and Disney does not fall under the tax rebate language of Measure L,” Anaheim city spokesman Mike Lyster said Tuesday.
Disneyland workers have been fighting for better wages and working conditions for several years.
In a February 2018 report, Disneyland employees cited high instances of homelessness, low wages and food insecurity. The report was compiled for the Coalition of Resort Labor Unions by researchers at Occidental College and the Los Angeles-based Economic Roundtable.
According to the Coalition of Resort Labor Unions, more than 85% of union workers at Disneyland earned less than $15 an hour at the time of the 2018 report, which was released before Measure L was approved.