The Walt Disney Co. has reached an agreement with the U.S. Labor Department that will provide $3.8 million in back wages to Disney workers.
Under the agreement, Disney will pay back wages to 16,339 employees of Disney Vacation Club Management Corp. and Walt Disney Parks and Resorts U.S. Inc., both in Florida. The department's Wage and Hour Division found violations of minimum wage, overtime and record-keeping provisions.
Disney resorts in Florida deducted a uniform or "costume" expense that caused some employees' hourly rates to fall below the federal minimum wage, the department said. The resorts also did not compensate employees performing duties during a pre-shift period before the designated start of their shifts, and during a post-shift period, according to the Labor Department. Additionally, the resorts failed to maintain required time and payroll records.
"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," he said.
White, in a news release, said that the Disney resorts were "very cooperative" and "worked with the division to ensure employees received the pay they earned," White said.
Disney said in a statement that "the Department of Labor has identified a group of cast members who may have performed work outside of their scheduled shift, and we will be providing a one-time payment to resolve this. We are adjusting our procedures to avoid this in the future."