In a major legal milestone for labor rights, a California judge has officially approved a $233 million settlement between Walt Disney Co. and tens of thousands of its Disneyland employees. The settlement resolves a long-running dispute over allegations that Disney underpaid workers in violation of Anaheim’s voter-approved minimum wage law.
The Case That Sparked Change
The lawsuit, filed in December 2019, arose after Disneyland employees claimed that Disney failed to comply with Measure L, a 2018 Anaheim ballot initiative requiring certain employers to pay a “living wage.” Specifically, Measure L mandates that companies benefiting from Anaheim’s tax subsidies pay employees a starting hourly wage of at least $15 in 2019, with annual increases.
Disney initially argued it was exempt from the law, maintaining that its agreements with Anaheim did not qualify as the kind of subsidy covered under Measure L. Employees, however, contended that Disney had, in effect, benefited from city subsidies through its long-standing financial arrangements with Anaheim, and therefore was legally obligated to pay the higher wages.
This legal battle attracted significant public attention, as it pitted one of the world’s largest entertainment companies against the very workers who form the backbone of the “Happiest Place on Earth.”
What the Settlement Includes
Under the terms of the court-approved settlement:
- $179.6 million will be distributed among the more than 51,000 affected Disneyland cast members. This will retroactively compensate them for wages they argue they should have been paid under Measure L’s requirements.
- $17.5 million will go to the California Labor & Workforce Development Agency as a civil penalty, underscoring the public policy dimension of the case.
- $35 million will be allocated for attorneys’ fees.
- The remaining amount will cover litigation costs, settlement administration, and other related expenses.
Judge William Claster of the Orange County Superior Court stated that the settlement was “fair, reasonable, and adequate,” and consistent with public policy designed to protect workers’ rights.
Significance for Disney Employees
This settlement marks one of the largest wage-related payouts in recent years for theme park workers and underscores the growing influence of living wage campaigns across the country. For thousands of Disneyland cast members—many of whom have publicly spoken out about struggling to make ends meet in Southern California’s high-cost economy—the payout represents not only financial relief but also a symbolic victory in their years-long battle for fair pay.
Disney, for its part, has emphasized that its current compensation practices exceed the minimums required under Measure L. A company spokesperson noted that 96% of Disneyland’s cast members now earn more than $22 per hour, well above the current Measure L minimum of $20.42 per hour and California’s statewide minimum wage of $16.50.
This assertion is critical for Disney, as the company aims to reassure employees, unions, and the public that it remains committed to offering competitive pay.
Implications for Employers
The outcome of this case serves as a significant precedent for other California employers who may be subject to local living wage ordinances. It highlights the potential financial exposure companies face if they attempt to sidestep wage laws based on narrow interpretations of exemptions.
Labor and employment attorneys are likely to cite this case in future disputes involving municipal wage mandates and subsidy-related obligations. For in-house counsel and HR compliance teams, this decision is a reminder of the importance of proactively auditing wage practices to ensure alignment with evolving state and local requirements.
A Broader Labor Movement
Disney’s settlement also reflects a broader labor trend. Across the country, workers in various sectors—from hospitality to healthcare—are increasingly turning to litigation and collective action to enforce wage and hour protections. Legal experts suggest that the Disneyland case may embolden workers in other industries to bring similar suits, particularly in jurisdictions with living wage laws tied to public subsidies or tax incentives.
Additionally, the case comes at a time when California lawmakers are actively considering measures to strengthen enforcement mechanisms for wage theft and expand penalties for noncompliance. Employers in the state should anticipate heightened scrutiny and potential increases in litigation risk.
Final Thoughts
This $233 million resolution closes a contentious chapter in Disney’s history while signaling to other large employers that compliance with local wage ordinances is not optional. For labor advocates, it is a validation of years of grassroots organizing and legal strategy aimed at ensuring that workers receive compensation reflective of the cost of living in their communities.
For Disneyland employees, many of whom have worked through the pandemic and faced rising housing costs, the settlement represents a long-awaited recognition of their economic struggles and their contribution to one of the most iconic entertainment brands in the world.
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