On Monday, the Department of Labor sent a letter to all state workforce agencies, administrators and liaisons, hoping to deter defense contractors from notifying employees of diminishing government funding, and urging them to forget about telling employees about the potential for massive layoffs “right before Election Day.”
As lawmakers on Capitol Hill work to deliver a solution to a looming deadline that could “sequester” billions from the defense budget, the Obama administration is advising defense contractors to forget about the Worker Adjustment and Retraining Notification (WARN) Act — ensuring employers that the standards in the law need not apply to them.
“Such federal announcements would be sudden and dramatic, and in such cases, consistent with the WARN Act, employers would not have to provide the full period of notice,” the letter stated.
While defense contractors and GOP lawmakers have been probing the White House for guidance on the sequestration, the Department of Labor’s only suggestion is to delay notification until after the November 6 election.
Members of both the House and Senate along both party lines are working to avoid more than $1 trillion in defense cuts, yet the Obama administration has yet to offer a solution to either the Department of Defense and defense contractors.
Under the Budget Control Act passed by Congress and approved by the President last year, massive mandatory cuts would go into effect on January 2 — jeopardizing the jobs of hundreds of thousands in the defense industry.
Because the Pentagon would be forced to eliminate a substantial chunk of its budget, defense contractors such as Lockheed Martin and Northrup Grumman stand to lose funding from the government.
Under the WARN Act, passed in 1988, employers are required to give their employees a minimum of 60 days notice – delivering pink slips to employees by November 2 at the latest, a mere four days before the election.
However, GOP lawmakers warn the administration is leading defense companies into the lion’s den for lawsuits from employers, as it is mandatory for contractors to notify employees of the potential for layoffs.
“The president got caught trying to get companies to violate the law,” Republican Sen. James Inhofe of Oklahoma told TheDC.
Under section 3 of the act, an employer shall not order a plant closing or massive layoff until the end of a 60 day period after the employer services written notice of such order.
“He’s trying to avoid taking the responsibility for losing hundreds of thousands of jobs,” Inhofe, a member of the Senate Armed Services Committee, said.
The letter, sent by assistant secretary Jane Oates, was written specifically to provide guidance to those who would be affected by the sequester and are required by law to adhere to the WARN Act, stating “even the occurrence of sequestration is not necessarily foreseeable.”
Inhofe, though, says ignoring the specifications of the WARN Act would only open the door for employers to be sued.
“Would they rely on the Obama Labor Department telling them there is a loop hole in the law? No,” he said.
Because the cuts come on the heels of the election, the president stands to lose the thousands of voters who could be jobless because of the defense cuts – particularly in swing states like Virginia and Florida.
“His main concern is states like Virginia, Florida, Pennsylvania and Ohio,” Inhofe said. “He doesn’t want those cuts to reach the thousands of voters.
“He doesn’t want those thousands of people to blame him so he’s trying to get those people to get pushed back. We’ve been stonewalled by the President, he doesn’t want people to know about this.”
If a sequestration does occur, companies like Lockheed Martin would have to lay off more than 100,000 jobs, with a large majority coming from Virginia. Yet the administration is advising the companies to ignore the WARN Act, alleging it doesn’t apply to them.
“This thing that came from the Labor Department yesterday is an insult to the intelligence to the corporate world. They know if they don’t comply with the law they’re going to open themselves up to lawsuits.”