The California Supreme Court has refused to hear an appeal by Disney over whether an Anaheim wage law applies to its lowest-paid theme park workers – setting the stage for the Disneyland Resort to raise wages for many of its employees.
Over the summer, the state’s 4th District Court of Appeal ordered raises and back pay for “cast members,” as Disney calls its employees, in a class-action lawsuit filed on their behalf. The state Supreme Court’s decision to let the appellate court’s order stand is a major legal blow to the media giant.
“Disney is at the end of the road in terms of appeals,” said Sarah Grossman-Swenson, an attorney representing the Disney workers. “The appellate decision is clear that Disney must comply with the law. The only remaining issue is the amount of damages.”
The dispute between Disneyland workers and the park began in 2018, when voters passed a law mandating a $15 minimum wage for businesses in the Anaheim resort area that had “tax abatement” agreements with the city. The voter-approved measure, known as Measure L, had been placed on the ballot thanks to a petition drive led by a coalition of Disney unions.
In the run-up to the election, Disney asked the Anaheim City Council to rip up a 45-year gate tax shield and a $267 million bed tax break for a now-abandoned luxury hotel project.
With those agreements cancelled, Anaheim’s city attorney said the law didn’t apply to Disney.
But a class-action lawsuit filed against Disney in December 2019 on behalf of 25,000 theme park workers disagreed.
An Orange County Superior Court judge originally sided with Disney before a three-judge panel overturned the ruling this summer, citing a provision in a 1996 Disney expansion deal passed by Anaheim in which the city agreed to reimburse the company if it had to cover bond payments.
Disney appealed to the state Supreme Court in August, claiming the appeals court had redefined what constitutes a tax refund in a way that would “chill” future public-private partnerships like the ’96 expansion deal that created Disney’s California Adventure, the Downtown Disney District and Disney’s Grand Californian Hotel.
With this week’s decision, the legal battle appears to be over.
“We are aware of the court’s decision and will comply with the requirements of Measure L,” said Jessica Good, a Disneyland Resort spokeswoman.
Anaheim spokesman Mike Lyster said the city “will continue to monitor how the court’s ruling is implemented”.
It is not yet known how many workers will be affected by the implementation of the law or how much back pay will be owed.
The wage scale under the law is set to rise to just under $20 an hour next year, when it is indexed to inflation.
Grossman-Swenson called the wage increases and back pay owed a “big deal” for Disney workers.
“We know that thousands of them have not been paid a living wage under the law for almost five years,” she added. “This will mean that they are entitled to their money and that can make a big difference in their lives.”