Furloughed employees will work through Friday and be paid through Oct. 16. MSE will assume 100 percent of the costs for health, vision and dental benefits for affected employees for the duration of their furloughs.
Monica Dixon, MSE chief administrative officer and president of external affairs, confirmed the details of the furloughs.
“The strain of balancing the tremendous fixed costs with the dramatic drops in revenue has taken a huge toll across our business and the sports and entertainment industry overall,” Dixon said in a telephone interview.
In Leonsis’s email, which was obtained by The Washington Post, the chairman said, “The reason we have chosen a furlough instead of a layoff is rooted in my confidence that our business will return to hosting events with fans at our venues, and with that, we hope to bring back impacted employees.”
After the NBA and NHL paused their seasons in mid-March, MSE committed to paying its 850 part-time staff members for postponed games and events through April. Those payments totaled $1.2 million.
MSE’s executive team took a pay cut in April, with Leonsis and his partners suspending their compensation entirely. With the NBA, NHL and WNBA seasons still on hold in June, the company announced a 20 percent reduction in base salary pay for employees earning more than $75,000, effective July 12 until the end of the year.
Other sports organizations have taken measures over the past five months to cut costs amid the uncertainty of the pandemic. In late March, the owners of the NHL’s Boston Bruins and TD Garden placed 68 of their full-time salaried employees on temporary leave. The following month, Pegula Sports & Entertainment, which owns the NHL’s Buffalo Sabres, laid off 21 employees and furloughed 104 more. This month, MSG Entertainment, the events company that owns Madison Square Garden, laid off 350. The New York Post reported that MSG Sports, which owns the NBA’s New York Knicks and NHL’s New York Rangers, laid off 50 employees.
While the NHL and NBA seasons have since resumed and the WNBA’s shortened 2020 campaign tipped off last month, games are being played in controlled bubble environments, away from Washington and without fans. Capital One Arena and Entertainment and Sports Arena, the Mystics’ home, which typically host concerts and other events when their tenants are on the road and during the offseason, have been dormant since March.
Dixon noted that Capital One Arena and Entertainment and Sports Arena would have hosted more than 75 games, concerts and events since the NHL joined the NBA in pausing its season March 12.
“Our furloughs were based on a current assessment of current and short-term business needs,” Dixon said. “They include employees whose job responsibilities have been affected by the hiatus and caused by the pandemic. We’re making changes today to protect the long-term viability of the company, preserve the ability of the business to be operational and successful when we return to normal.”
Restrictions on large gatherings in the District remain in place under order of Mayor Muriel E. Bowser (D). Leonsis, in his email to employees, said the region has “not progressed as positively” as he had hoped toward reopening.
“We continue to support locally elected and community leaders in the DMV as they respond to the pandemic,” he wrote. “The health and safety of our employees, teams, fans, and partners remain our top priorities as it relates to reopening our business.”
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