The Walt Disney Company has introduced a voluntary early retirement program for a group of senior executives as the entertainment giant continues efforts to cut costs and reshape its workforce.
The Voluntary Early Retirement Offer, or VERO, was announced in an internal memo sent Monday, August 24, by Disney Senior Executive Vice President and Chief People Officer Sonia Coleman. The program gives eligible executives the option to leave the company with an enhanced severance package before further workforce reductions take place.
The offer is available to U.S.-based employees at the director level through executive vice president level across Disney Entertainment, ESPN and corporate divisions.
According to Variety, employees must meet a minimum score of 65 based on their age and years of service to qualify. They must also be at least 50 years old and have worked for Disney for a minimum of 10 years.
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Executives who accept the offer can receive separation pay of up to one year, depending on their tenure. They will also receive healthcare coverage at active employee rates throughout their severance period.
The package includes additional benefits that go beyond standard severance. According to Deadline, eligible executives will continue to receive vesting on existing equity awards for three years. They will also retain lifetime Silver Pass privileges, allowing them to enter Disney theme parks for free outside blackout dates.
The program does not include a non-compete clause, meaning executives who take the offer will be free to work for other companies after leaving Disney.
In the memo, Coleman described the program as one part of Disney’s broader effort to reduce expenses while continuing to invest in content, technology and experiences.
“Over the past few years, we’ve made real changes to how we operate, and we’re still in that process. As you heard on our most recent earnings call, we’re focused on meaningfully reducing costs as part of our ongoing transformation, so we can continue to invest in the areas that will drive our future growth: content, technology, and experiences.”
Coleman said Disney has already started involuntary staff reductions in some parts of the company and expects those cuts to continue into next year.
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“This is one of several actions we’re taking to reshape our organization, including involuntary staff reductions that have already begun in some areas and will continue into next year,” she wrote.
The voluntary program is designed to give eligible employees an opportunity to decide whether to leave before Disney makes additional organizational decisions.
“By offering a voluntary retirement program, we hope to give eligible employees an opportunity to make a personal decision on their own terms before broader organizational decisions are finalized,” Coleman said.
Disney said eligible executives will receive individual communications outlining the terms of the offer, the election process and important deadlines.
The company also emphasized that participation is optional and that employees will have a specific period to consider the offer before making a decision.
The VERO comes after Disney carried out multiple rounds of workforce reductions this year. The company reportedly cut as many as 1,000 jobs in April, followed by additional layoffs in July.
Disney’s latest move signals that the company is continuing to look for ways to reduce its workforce and operating costs while redirecting spending toward areas it sees as critical to future growth.
For longtime executives who qualify, the retirement offer provides a way to leave with financial and employment benefits that may not be available under a standard departure package.