Walt Disney Co. Agrees to $3.8 Million Payout to Settle Unpaid Overtime Claim

Walt Disney Co. Agrees to $3.8 Million Payout to Settle Unpaid Overtime Claim

ORLANDO — The Walt Disney Co. recently agreed to a $3.8 million payment with the Department of Labor to resolve more than 16,000 unpaid overtime and minimum wage claims with current and former employees for the company’s Vacation Club Management Corp. and Parks and Resorts U.S. Inc., both based in Florida. According to the Labor Department, Disney made deductions from employee paychecks that caused the worker’s pay to drop below the national $7.25 average under federal law.

According to the complaint, Disney made deductions for costumes worn by performers and other workers at its parks and failed to pay them and other employees for time spent on the job before and after their shifts. Other complaints allege that Disney failed to keep accurate payroll and time records for workers as required under the Fair labor Standards Act.

“These violations are not uncommon and are found in other industries, as well,” said Daniel White, district director for the Wage and Hour Division in Jacksonville. “Employers cannot make deductions that take workers below the minimum wage and must accurately track and pay for all the hours their employees work, including any time they work before or after their scheduled shifts. We hope the resolution of this case alerts other employers who may be paying employees in a similar manner, so that they too can correct their practices and operate in compliance with the law.”

While Disney admitted no liability in the settlement, the resolution covers unpaid overtime claims from 2013 to 2017. As is typical in many similar cases in which federal regulators involved themselves, the defendant agreed to institute several changes to protocols “on what constitutes compensable work time and the need to accurately record all such time.’’

Beginning soon, managers and employees at the company’s Florida resort hotels will undergo training to help them comply with federal wage and labor laws, specifically to policies under the Fair Labor Standards Act.

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