In a landmark victory for thousands of employees at Disneyland, a three-judge panel from the Fourth Appellate District court has ruled that Disney must adhere to Anaheim’s minimum wage law, Measure L, as it does indeed receive city subsidies. This groundbreaking decision means that Disneyland employees could soon see their minimum wages soar to nearly $20 an hour, a significant increase that carries profound implications for the livelihoods of these workers and potentially those in similar industries.
The crux of the issue stemmed from a long-debated question in Anaheim: Are taxpayers subsidizing the “happiest place on Earth”, Disneyland? The answer, according to the appellate court judges, is a resounding “yes.”
Disneyland, they clarified, falls under a 2018 Anaheim legislation known as Measure L. This law mandates that hospitality employers in the resort district that receive city subsidies are required to pay their workers higher wages. The legal decision from the three-judge appellate panel is rooted in a 1996 resort district bonds agreement, wherein Disney agreed to cover bond payments if the city were to fall short, with the understanding that the city would repay Disney in the future.
The judges’ ruling states:
“We find the Reimbursement Agreement gives Disney the right to receive a rebate—or a return—of transient occupancy taxes (paid by hotel guests), sales taxes (paid by consumers), and property taxes (paid by Disney), in any rebound years when the City’s tax revenues are sufficient to meet its bond obligations. Consequently, Disney receives a ‘City Subsidy’ within the meaning of the living wage ordinance and it is therefore obligated to pay its employees the designated minimum wages.”
This judgment translates into a substantial victory for thousands of Disneyland Park employees, resort area hotel employees, and food service workers, who are now entitled to wages previously denied to them. The ruling also sends a powerful message to other corporations and industries regarding the importance of fair wages for employees.
Disney’s resistance to Measure L has been based on a series of legalistic arguments about whether it had an agreement with the City for a tax rebate. However, the court found that Disney’s entitlement to a rebate is clear. The question that remains now is how long Disney will prolong this situation in order to avoid paying its employees what the law requires.
Disneyland, an influential player in local politics, has significantly financed city council campaigns through its chief local elections spending vehicle, Support Our Anaheim Resort (SOAR). Despite these efforts, more than 45,000 Anaheim voters decided in favor of the minimum wage ordinance in the 2018 November election, which was approved by a margin of 54% to 46%.
Nevertheless, Disneyland refused to comply with the law, arguing that a rebate was not a subsidy, a stance that was initially supported by city officials. The appeals court judges disagreed, however, stating:
“In short, we hold Disney receives a ‘City Subsidy’ within the meaning of the LWO (living wage ordinance) and is therefore required to pay its employees a living wage.”
In response to Disneyland’s refusal to comply with the law, employees filed a class-action lawsuit against the company in 2019, alleging that Disneyland was receiving a subsidy from the city through the 1997 resort bonds which helped build the Mickey and Friends parking garage and improvements to the California Adventure side of the park.
The case was initially ruled in favor of Disney in 2021 by OC Superior Court Judge William Claster, who stated that while the company benefited from the bonds, it did not amount to a subsidy. However, the workers appealed this ruling and won, marking a significant victory for Disneyland employees and advocates for workers’ rights.
In reaction to the court’s decision, Regina Delgado, a former employee of the Plaza Inn resort area hotel and plaintiff in the case, said, “We are thrilled by the Court’s decision and hope Disney will stop fighting against paying its workers a living wage.”
The ruling comes as unionized hotel workers at the Anaheim Hilton and Sheraton Park in the resort area staged walkouts this week as part of rolling strikes for better pay.
Ada Briceño, co-president of Unite Here Local 11 – the union representing hotel workers in Southern California, expressed her elation at the court’s decision in a phone interview, stating, “We believe that workers should have the right to live where they work, especially those who make Disneyland or the surrounding hotels profitable.”
The outcome of this ruling is monumental for Disney workers, who have been fighting for better wages and benefits for years. The court’s decision marks a significant step towards improved living conditions for thousands of Disneyland employees, and sets a precedent for future workers’ rights cases. As attorney Richard McCracken, who represented the plaintiffs in the lawsuit, stated:
“The only really surprising aspect of this case is how much effort Disney has devoted to avoiding paying all its employees at least $15 an hour. The Court of Appeal has carried out the intentions of the Anaheim voter.”
This historicruling has the potential to change the landscape for Disney employees and those in similar industries. It emphasizes the importance of a living wage, particularly for those employees who are essential to the operation and success of major corporations like Disneyland.
The decision also underscores the power of collective action. The Disneyland employees’ victory was not just a result of legal action, but also of their continued advocacy and organizing efforts. This case serves as a reminder of the significant changes that can occur when workers stand together to demand fair treatment and compensation.
Disneyland has yet to release a statement regarding the court’s decision. It remains to be seen whether the company will appeal the ruling or comply with the new minimum wage requirements. However, the court’s decision is a significant step forward in the fight for fair wages and workers’ rights.
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