By law, a company must send out layoff notices 60 days prior to a plant closing or a mass layoff. This was put into place as a result of the WARN Act, or Worker Adjustment and Retraining Notification Act, enacted in 1988. In light of the impending across-the-board budget cuts that are coming January 1, 2013 due to the failure of the Joint Select Committee on Deficit Reduction, more commonly known as the Super-Committee, to find a way to cut $1.5 trillion from the federal deficit over the next decade, major cuts to defense are imminent. These cuts to defense will affect major defense contractor, Lockheed Martin. Looking ahead to the inevitability of these events, Lockheed Martin warned that it will be sending out layoff notices, which are required by law, in early November, just days before the presidential election.
Now Lockheed Martin says that they will not issue the layoff notices, at the request of the White House. Last Friday, U.S. Senators John McCain, Lindsey Graham, and Kelly Ayotte released a statement on the Obama Administration’s guidance to Lockheed Martin to ignore the WARN Act, calling the current administration out on this thinly veiled political move. In the memorandum from the Office of Management and Budget issued last Friday, the administration concluded that notices would not be necessary in this situation because it would cause “waste and disruption,” but if any potential future litigation would be faced, the government would allow certain compensation, litigation, and attorney fees to be covered by the government contract.

Obviously, if Lockheed Martin sends out layoff notices a few days before the election, this could have a negative impact on the President’s re-election. But should politics really matter when it comes to following the law? Asking this company to not follow the WARN Act, is setting the company up for potential massive lawsuits, for which the government is volunteering to pay. What will the government use to pay for these lawsuit expenses? Taxpayer dollars, of course. With the government hitting a new high for the national debt at $15 trillion, is it really a safe bet for Lockheed Martin to trust that Congress will go along with this plan and vote to fund this, should these events happen? Lockheed Martin could always hope that whichever man is elected next year will realize that cutting defense puts our country at risk and will work with Congress to opt for budget cuts elsewhere.