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White House Wins: Lockheed Martin Won’t Issue Layoff Warnings Days Before Election


In June, Politico reported that Lockheed Martin could be announcing potential layoffs to employees shortly before the election:


Right before Election Day, the company is likely to notify the “vast majority” of its 123,000 workers that they’re at risk of being laid off, said Greg Walters, the company’s vice president of legislative affairs.

Walters’s comments are some of the most specific threats yet from an industry that’s trying to head off the $500 billion in automatic cuts in defense spending set to begin taking  effect Jan. 2. Called sequestration, the cuts are being phased in over 10 years, with about $55 billion slated for 2013.

Well now, Lockheed has announced they won’t send out the notices — because the administration has put significant pressure on the company to not to, as ABC News reports:


In July the Labor Department issued legal guidance making clear that federal contractors are not required to provide layoff notices 60 days in advance of the potential Jan. 2 sequestration order, and that doing so would be inconsistent with the purpose of the WARN Act.

In Friday’s memo, the Office of Management and Budget reiterated that notice, urging agencies’ contracting officials and CFOs to “minimize the potential for waste and disruption associated with the issuance of unwarranted layoff notices.”

The guidance issued Friday told contractors that if the automatic cuts happen and contractors lay off employees the government will cover certain liability and litigation costs in the event the contractor is later sued because it hadn’t provided adequate legal warning to its employees, but only if the contractor abides by the administration’s notice and refrains from warning employees now.

Why did the administration get so concerned about Lockheed sending out the notices? Well, because Lockheed is a major employer in Virginia, a significant swing state. As The Atlantic put it in a headline, “Did Lockheed Martin Just Win Virginia for Obama?”


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