The hits just keep on coming following the implementation of the new corporate tax rate (down to 21% from 35%) that was a part of the GOP tax plan, as two giant companies announced on Tuesday that they will be sharing the savings from the tax cuts with their employees.
The Walt Disney Company revealed that they will be giving 125,000 of their employees a one-time cash bonus of $1,000. The bonus announcement was accompanied by another initiative in which Disney will help out employees with tuition costs.
According to Bloomberg:
About 125,000 U.S. employees will be eligible, the company said Tuesday in a statement, putting the cost at $125 million. Disney also plans to put $50 million into a fund to help hourly employees with tuition costs and plans to provide as much as $25 million annually for that purpose afterward.
In a statement, Disney said, "The two new initiatives are a result of the recently enacted tax reform and represent a total allocation of more than $175 million in this fiscal year."
Not to be outdone, Verizon announced Tuesday that it will give 155,000 employees 50 shares each of restricted stock. Restricted stock are shares of a company that aren't allowed to be transferred unless certain criteria are met.
According to CNBC:
The award could total over $400 million, based on Verizon's current share price. Shares traded around $53 a share on Tuesday, down from a fresh 52-week intraday high of $54.60 after quarterly earnings were released.
The announcement comes after Verizon hinted in its morning earnings report that "employees will further share in the company's success" around tax reform. Verizon expects savings from tax reform will add $3.5 billion to $4 billion to its operating cash flow this year, boosting earnings by 55 to 65 cents a share for the full year.
"What tax reform allows is for us to go hard when we get the results we're expecting," Verizon CEO Lowell McAdam said.
I don't know about you, but $3.5-$4 billion is a lot of scratch, and it's all thanks to the "armageddon" known as the GOP tax cuts.