To WARN or Not? Contractors Get Financial Cover to Withhold Layoff Notices

House Armed Services Committee Chairman Buck McKeon (R-Calif.) said yesterday that he believed Lockheed Martin's decision was "motivated by the same concern for their workers’ security as was their initial contemplation of WARN notices."

"It appears companies will bow to the threat implicit in last week's OMB guidance; withhold notices today or the government might not cover your court costs down the road," McKeon said. "Let me be clear, neither the OMB guidance nor the Lockheed decision will protect a single defense industry job if sequestration occurs in January."

GOP House leaders today went after the administration for the memo, especially as the cuts loom with no resolution in sight.

"For an administration that talks a lot about transparency, it is disappointing that they apparently think it is more important to protect their political interests than give hard working families any indication that they might in fact lose their job in 60 to 90 days due to inaction by the President and Senate Democrats," said Majority Leader Eric Cantor (R-Va.).

House Speaker John Boehner (R-Ohio) blasted the "Friday evening news dump" that demonstrated "this is a White House in denial about the consequences of its own irresponsible actions."

“As Commander-in-Chief, President Obama owes our troops a plan that ensures they have the resources to carry out their mission," Boehner said. "If neither the president nor his Democratic majority in the Senate are prepared to offer an alternative, they should have the courage to act on the House-passed plan immediately and remove the threat of the looming cuts facing our armed services at this critical time.”

The Worker Adjustment and Retraining Notification (WARN) Act requires most employers with 100 or more workers to give 60 days' notice of plant closings and mass layoffs. Graham noted Monday that as a senator, Obama wanted that lengthened to 90 days in the interest of workers' rights.

White House press secretary Jay Carney said the prospect of political embarrassment days before the election was "absolutely not" the impetus for the OMB guidance.

"I think the WARN Act action has been thoroughly explained and described, and individual companies like Lockheed make the decisions according to their own interests," Carney said at today's news briefing.

In response to Boehner and Cantor, Carney reminded all that the repeal of sequestration is explicitly tied by Democrats to letting the Bush-era tax cuts expire for upper-income brackets.

"That has been the singular obstacle to a comprehensive deficit reduction plan passing Congress, resolving the fiscal -- so-called fiscal cliff," he said. "If Speaker Boehner is as concerned as he seems to be in this statement about the fiscal cliff, then he, as leader of the House of Representatives, should bring back the House and pass the bill that the Senate passed extending the Bush-era tax cuts for 98 percent of the American people."

Campaign spokeswoman Jen Psaki added "it shouldn't be lost that this is all happening during the backdrop of a presidential election happening in 34 days."

"And those statements sound remarkably similar to the comments that are being made by Mitt Romney and Paul Ryan out on the campaign trail accusing the President of having a lack of details," Psaki said. "And that's a piece of it that certainly plays in -- is a factor in the back-and-forth at this stage."

McKeon accused Obama of issuing "politically motivated memos with dubious grounding in the law."

"In so doing, the President eliminated the very reason for having the WARN act in the first place. Notifications will not be sent to those at risk, even though we have heard directly from CEOs in hearings this summer that layoffs will occur," the chairman continued. "Further, even though the OMB directive purports to protect the defense industry against the costs of not complying with the WARN Act, they cannot guarantee how the courts would rule in such an action. Thus the President has pledged to compound the impact of sequestration by dedicating already scarce resources to cover needless court costs."

“These directives have not enhanced our national security and they haven't helped anyone's job security," McKeon said. "The only thing the President seems interested in securing is his own re-election."