Disney Tells 1,000 Staff Its Legal Team Will Become 'Much Smaller' as It Embraces Automation and Outsourcing

Disney's Legal and Global Affairs employees are facing uncertainty over potential job cuts after an internal memo outlined a major transformation of the department. According to Deadline, Chief Legal and Global Affairs Officer Horacio Gutierrez sent the memo to roughly 1,000 LGA employees around noon on 18 September.

While Gutierrez did not say that artificial intelligence would directly lead to job losses, he warned that the division would undergo significant changes involving technology, outsourcing, and staffing. The memo's references to 'hard choices' and a smaller workforce have raised concerns among employees about possible layoffs.

Disney Warns of a Smaller Legal Team

Gutierrez, Disney's chief legal and global affairs officer, said the department would 'start with a blank slate' as technology reshapes legal and other professional work. 'How should LGA reinvent itself to best serve the Disney of tomorrow?' he wrote in the memo. He said the department was embarking on a transformation process called 'LGA 2.0.'

Gutierrez was also direct about the scale of the planned transformation: 'Obviously, this will require hard choices about where and how we deploy our resources and investments, including our staffing investments, and how we work will look different in the months and years ahead... LGA will be a much smaller organisation than it is today, and some of you will personally be affected by decisions we make in this process.'

The memo indicates that some employees will be affected, although it does not provide a specific number of positions that could be cut. Gutierrez also pointed to several ways the department could operate differently, including 'automating certain workflows by leveraging the latest technologies, moving to self-service models where appropriate, engaging alternative legal providers and others and new expanded shared services, even outsourcing.'

Cost Cuts Add to Layoff Concerns

Chief Financial Officer Hugh Johnston said during Disney's third-quarter fiscal 2026 earnings call that the company was looking at 'meaningful reductions to cost, including labour and SG&A.' Disney's third-quarter fiscal 2026 results were released on 5 August, with executives also highlighting efforts to improve productivity and efficiency while continuing to invest for growth. The company's earnings materials also identified potential future efficiencies and cost reductions as forward-looking considerations.

Technology Takes Centre Stage at Disney

The memo also cited Chief Executive Officer Josh D'Amaro's vision for using technology to change how Disney operates. Citing D'Amaro, Gutierrez wrote: 'When teams work smarter, Disney can serve more fans at lower costs, freeing up capital to reinvest in the content, guest experiences, and technology infrastructure that keep the company out in front.' He added that D'Amaro's vision involved 'breaking internal walls and embracing technology to amplify what makes it great, not by clinging to the way things always have been done.'

The timing was notable. Disney announced on 18 September that Karandeep Anand would become its chief technology officer, taking on the newly created role on 2 October. Disney said Anand, formerly CEO of Character.AI and a technology executive at Meta and Microsoft, will oversee enterprise technology, infrastructure, data and AI platforms, and product and engineering.

More Changes Could Be Coming

The LGA restructuring comes amid other changes at Disney. According to Deadline, several longtime Disney executives were offered the company's voluntary early retirement package in August.

Deadline also reported that unspecified cuts within LGA were separate from the next round of expected cuts, indicating that the department's restructuring was being considered separately from those broader reductions. For now, Disney has not publicly disclosed how many LGA positions could be affected by the transformation.