Disney's executives are pushing back after being told the pay cuts they're taking are temporary with no end in sight. There is some unrest bubbling up between the company's senior leaders and the executives over the pay cuts in response to the coronavirus pandemic. The Hollywood Reporter has multiple sources that say that VP, Senior VP, and Executive VP level personal are upset that the cuts were decided on without being put to vote. The 20-30 percent chunk of the earnings disappearing was one thing, but that was before they discovered the there was no timetable for when things would switch back to normal.
Bob Iger is acting Chairman of Disney and he's forgoing his entire salary this year. CEO Bob Chapek is slashing his own base pay by 50 percent to help out. To put it in perspective, the average Disney VP earns in the range of $150,000 to $200,000 in base pay. (Those are figures reported by THR) On the Executive VP level, things can go higher than $700,000 depending on which branch of the business they reside in. There is also the matter of the Disney stock options available to those at these lofty levels.
Some of the disgruntled VPs, senior VPs, and executive VPs argue that this isn't fair because Iger and Chapek still have other forms of compensation secured. Iger especially has netted $44.5 million in additional compensation because of company performance coming out of last year. All of that would remain intact while the $3 million base salary is what would go unpaid. Meanwhile, Chapek has $2.5 million in base salary. But, his annual target bonus is $7.5 million and there is an annual long-term incentive grant worth $15 million out there for him as well.
A source told THR, "Much of the company has ground to a halt because of this pandemic, and for these people to complain in the face of so much suffering in the world is just incredibly selfish and sad."
These executive contracts aren't mandatory to be signed, but some fear that their career mobility and future bonuses may be riding on their willingness to sign on the dotted line. However this shakes out. It paints a strange picture for everyone looking on at home. Hopefully, some resolution will be reached in the coming days.
How do you feel about the cuts going on in the entertainment industry? Let us know about it in the comments!