Despite administration warnings that notices related to sequestration were unnecessary, Lockheed Martin and Pratt & Whitney are continuing their preparations.
Lockheed Martin and Pratt & Whitney are going forward with plans to issue layoff notices to thousands of employees due to looming defense cuts under sequestration, despite administration claims that such warnings are unnecessary.
U.S. defense companies planned to start handing out pink slips in November under federal mandates outlined in the Worker Adjustment and Retraining Notification (WARN) Act, due to the anticipated $500 billion automatic cut to defense coffers are set to go in place in January.
But administration officials from the Department of Labor have argued that such notices did not fall under the act’s mandates, noting the law only required notices to be sent out if layoffs are caused by a foreseeable event.
Since Congress has the power to come up with an alternative sequester plan, the White House argues, those automatic defense cuts don’t qualify as a foreseeable event.
But lawmakers remain deadlocked on a viable alternative, increasing the likelihood of those cuts going in effect early next year.
That gridlock on Capitol Hill has prompted some American defense firms to begin preparing to send out pink slips to their employees.
“Right now the WARN Act is the law, and we always comply with the law, so we’re not quite sure we understand the direction from the Department of Labor,” Hess told Reuters during an anti-sequestration rally in Florida on Wednesday.
“We’ll make a decision in the future as to whether or not we’ll issue WARN notices. Some of it may depend on what clarity we get in 30 days,” Hess said.
If the firms decide to issue layoff notifications, defense industry employees would begin receiving those notices days before the presidential elections.