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. . . to your swing-state workers just days before the election, even though required to under the WARN Act -- and if you don't, we'll cover your legal costs if you get sued by your workers under the act.
At White House Request, Lockheed Martin Drops Plan to Issue Layoff Notices - ABC News
But:
How this wouldn't appear to be obvious electioneering on the taxpayer's dime, and with dubious authority, is beyond me.
Senators Grassley and Ayotte have sent a letter, which reads, in part:
At White House Request, Lockheed Martin Drops Plan to Issue Layoff Notices - ABC News
Defense contractor Lockheed Martin heeded a request from the White House today — one with political overtones — and announced it will not issue layoff notices to thousands of employees just days before the November presidential election.
Lockheed, one of the biggest employers in the key battleground state of Virginia, previously warned it would have to issue notices to employees, required by law, due to looming defense cuts set to begin to take effect after Jan. 2 because of the failure of the Joint Select Committee on Deficit Reduction — the so-called Super-committee, which was created to find a way to cut $1.5 trillion from the federal deficit over the next decade.
Such massive layoffs could have threatened Obama’s standing in the state he won in 2008 and is hoping to carry again this November.
On Friday, the Obama administration reiterated that federal contractors should not issue notices to workers based on “uncertainty” over the pending $500 billion reduction in Pentagon spending that will occur unless lawmakers can agree on a solution to the budget impasse, negotiations over which will almost definitely not begin until after the election.
Contractors had been planning to send out notices because of the WARN Act — Worker Adjustment and Retraining Notification Act — which according to the Department of Labor requires “most employers with 100 or more employees to provide notification 60 calendar days in advance of plant closings and mass layoffs.”
But:
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.
How this wouldn't appear to be obvious electioneering on the taxpayer's dime, and with dubious authority, is beyond me.
Senators Grassley and Ayotte have sent a letter, which reads, in part:
We are seriously concerned about the OMB’s memorandum and the DOL’s letter. In particular, we are concerned about the authority of the Executive Branch to instruct private employers not to comply with federal law and to promise to pay the monetary judgments and litigation costs that arise out of the lawsuits that may follow. Although the precise amounts of the judgments and costs are unknown, they could potentially reach tens or hundreds of millions of dollars, if not billions of dollars, all of which would be paid for with taxpayers’ dollars.
Accordingly, respond to the following questions and requests for information:
1. Identify the legal authority for the DOL to instruct federal contractors that they are not required to provide WARN Act notices to their employees in light of the pending sequestration.
2. Identify the legal authority for the OMB to instruct federal contractors that they are not required to provide WARN Act notices to their employees in light of the pending sequestration.
3. Identify the legal authority for the OMB to promise to pay the monetary judgments and litigation costs that arise out of the lawsuits that could follow from employers’ failure to comply with the WARN Act.
4. Set forth the analysis and supporting legal authority for the representation in the OMB’s memorandum that “any resulting employee compensation costs for WARN Act liability as determined by a court, as well as attorneys’ fees and other litigation costs (irrespective of litigation outcome), would qualify as allowable costs and be covered by the contracting agency, if otherwise reasonable and allocable.”
5. Explain in detail why you maintain that the Obama Administration did not have to first obtain approval from Congress before committing to pay tens or hundreds of millions of dollars (if not billions of dollars) in judgments, settlements and/or attorneys’ fees that may be incurred by private employers.
6. Identify in detail the costs that the OMB’s memorandum represents the Administration will “cover” for contractors who are sued based on their failure to provide notices under the WARN Act. For example, do the “costs” include reimbursing the contractors for the attorneys’ fees they incur from defending themselves in WARN Act lawsuits? What other “costs” will be “covered”?
7. How many millions or billions of dollars has the OMB’s memorandum obligated the federal government to pay, if WARN Act notices are not provided and layoffs and lawsuits do occur?
8. What will be the source of the funds used to pay the monetary judgments and litigation costs that arise out of the lawsuits that follow from employers’ failure to comply with the WARN Act? Does the Administration maintain that these funds have already been appropriated by Congress?
9. Before the release of OMB’s memorandum, was any analysis done to determine how much the federal government would have to pay to “cover” the costs of these lawsuits, including potential attorneys’ fees? If so, provide that analysis and provide copies of all documents related to that analysis.
10. Provide copies of any and all written analyses that were done in connection with the OMB’s memorandum.
11. According to the DOL’s July 30, 2012 letter, if contractors provide WARN Act notices, it “would be inconsistent with the purpose of the WARN Act.” By contrast, 29 U.S.C. § 2106 (the WARN Act) provides that “t is the sense of Congress that an employer who is not required to comply with the notice requirements of section 2102 of this title should, to the extent possible, provide notice to its employees about a proposal to close a plant or permanently reduce its workforce.” How does OMB justify DOL’s statement in light of the plain language of section 2106 of the WARN Act?
12. According to the OMB’s memorandum, “some [contractors] have inquired about’ whether Federal contracting agencies would cover WARN Act-related costs in connection with the potential sequestration.” Identify each of those contractors and produce all documents related to communications between the White House, DOL or any other federal agency and the contractors regarding this issue.
13. Does the Administration maintain that the OMB’s memorandum constitutes a binding legal promise to contractors that the federal government will fully indemnify them for any and all liability and legal defense fees that they incur as a result of their not providing WARN Act notices? If not, explain in detail whether the OMB’s memorandum makes any binding commitments and if it does, describe those commitments in detail.
14. Were any other federal agencies consulted prior to the issuance of the OMB memorandum? If so, identify each agency consulted and indicate whether any agency disagreed about whether the legal authority exists for the Administration to promise to pay the costs and legal fees associated with the failure to issue WARN Act notices.