Disney (DIS) will this week stop paying 100,000 employees, almost half of its global workforce, as it seeks to weather the economic storm created by the coronavirus pandemic.
The move by the world’s largest entertainment company will save as much as $500m (£400m) in salary costs, according to the Financial Times.
While staff placed on unpaid leave will receive full healthcare benefits, those based in the US have been encouraged to apply for government benefits.
The move comes as more than 20 million Americans have filed for unemployment benefits since the coronavirus crisis began.
Staff based in Paris will be placed on France's “partial activity scheme,” which allows companies to furlough workers and covers up to 84% of salary costs.
The company’s revenue-driving theme parks, including Disneyland Paris, have been closed for several weeks.
Last year, Disney made almost $7bn from its parks, experiences, and associated products business, accounting for nearly half of its operating profits.
Earlier this month, Disney said that it would furlough tens of thousands of workers, pointing to widespread shutdowns across the world.
“The COVID-19 pandemic is having a devastating impact on our world with untold suffering and loss, and has required all of us to make sacrifices,” the company said in a statement.
“Over the last few weeks, mandatory decrees from government officials have shut down a majority of our businesses.”
By the end of last month, Disney had raised more $20bn in fresh cash through debt raises and the signing of new credit facilities with lenders.
The company still expects to pay a dividend of $1.5bn to shareholders in July, and has thus far protected its executive bonus scheme, according to the Financial Times.
But Bob Iger, the company’s executive chairman, and Bob Chapek, its chief executive, last month announced they would take a 50% pay cut.
Iger, who had planned to retire from the company last year, made almost $48m from Disney last year, making him one of the highest-paid bosses in the entertainment industry.