Alleges that Disney terminated the employment of the plaintiffs based solely on their national origin and race
After Disney IT workers were told in October 2014 of the plan to use offshore outsourcing firms, employees said the workplace changed. The number of South Asian workers in Disney technology buildings increased, and some workers had to train H-1B-visa-holding replacements. Approximately 250 IT workers were laid off in January 2015.
Now 30 of these employees filed a lawsuit on Monday in U.S. District Court in Orlando, alleging discrimination on the basis of national origin and race.
The Disney IT employees, said Sara Blackwell, a Florida labor attorney who is representing this group, "lost their jobs when their jobs were outsourced to contracting companies. And those companies brought in mostly, or virtually all, non-American national origin workers," she said.
The people who were laid off were multiple races, but the people who came in were mostly one race, said Blackwell. The lawsuit alleges that Disney terminated the employment of the plaintiffs "based solely on their national origin and race, replacing them with Indian nationals."
Disney responded to the lawsuit with this statement sent by a spokeswoman: "Like the two other dismissed cases brought by this lawyer, this latest lawsuit is nonsense and we will defend it vigorously.”
This is the second lawsuit filed by Disney workers represented by Blackwell against Disney Parks and Resorts. A lawsuit filed in January by two employees against Disney and two of the IT services contractors, HCL and Cognizant, alleged a conspiracy to displace U.S. workers but lost a key ruling in federal court and was dismissed.
The latest case brings a separate claim, and follows a process where the parties first filed complaints with the U.S. Equal Employment Opportunity Commission. If a settlement isn't possible, the EEOC issues a right-to-sue letter to the former employee.
The lead plaintiff in this new case is former Disney IT employee Leo Perrero, who testified earlier this year before a Congressional subcommittee about his experience in training a replacement.
Something Perrero said he noticed soon after Disney announced the outsourcing plan was "the demographic started changing so quickly." The technology buildings across the Disney campus "just all of a sudden had these South Asian foreign workers."
"It was unfathomable for me to think that this would happen — that people would be physically replaced by workers who just came in from offshore and were now here in person to replace us. It was completely shocking," said Perrero.
National origin discrimination claims against outsourcers are on the rise. The IEEE-USA is urging the incoming administration of President-elect Donald Trump to ask the Department of Justice to investigate citizenship discrimination complaints related to H-1B visa use.
The Disney discrimination lawsuit makes reference to Bob Iger, Disney's CEO, who called the type of replacement training "insulting," based on an interview in June by The Hollywood Reporter.
In this interview, Iger was asked about the outsourcing decision. He defended it and argued that it helped Disney upgrade its technology and created more jobs than were lost. But he also expressed regret about way the outsourcing was handled.
Iger told the Reporter: "The mistake that was made is that we asked people who were leaving to help train their successors. That's common in the business, but it doesn't necessarily mean that it's right. And looking back, I'm sorry that we did that because there's something insulting about that. That got a huge amount of attention and rubbed people the wrong way, and I completely understand why it would. It just does not pass a smell test, even if it is common practice."
Blackwell said that Iger never reached out to any of the affected employees to express his regrets.
"I think he is hypocritical by making a public admission that what he did was not okay. without ever reaching out to any of the people that were really the victims," said Blackwell. "He has a created a lot of problems and lot of heartache."
Iger's view about offshore outsourcing may ultimately affect more people than just those at Disney.
Iger was recently appointed by President-elect Donald Trump, along with 15 other business executives, to help the president "bring back jobs and make America great again," according to the Trump transition team announcement. Iger is also co-chair of the Partnership for a New American Economy, a group that advocates for increasing H-1B numbers and argues it increases job growth.
The membership of the "President's Strategic and Policy Forum" appears tilted toward firms that favor offshore outsourcing of IT. This includes the forum's chair, Stephen Schwarzman, the CEO of Blackstone, a private equity firm.
In April, Blackstone acquired a majority stake in Mphasis, an India-based IT services firm, from Hewlett-Packard Enterprise for about $1.1 billion. "The all-cash deal reinforces Blackstone's bullish outlook on the outsourcing business, where western clients send IT jobs to countries such as India to cut costs," wrote Reuters in a news report about the deal.