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The Worker Adjustment and Retraining Notification Act (WARN) requires companies to provide 60-days advance notice of pending mass lay offs or plant closures.  Due to the sequester, the Obama administration has been put in the difficult position of having federal contractors issuing these notices November 2, four days before the election.

So what does the Obama administration do?  First, the Department of Labor (DOL) issued guidelines this summer saying that employers did not have to issue these notices because DOL did not consider the sequestration situation as falling within the WARN act.

The problem is that laid off employees can sue individually, even if DOL does not take action.  So companies such as Lockheed Martin indicated that they would still send the notice.

So here is where it goes wrong.  On Sept. 28, the Office of Management and Budget (OMB) informed contractors that the Federal gov't will foot the bill for their litigation costs if they fail to issue the notices!  This is unprecedented, and it is wrong.  First off, the Federal government will only reimburse of the companies are found liable, i.e., once they have been found in violation of the law.  In other words, the Obama administration has committed to reimbursing companies for breaking the law.

Second, the guidance is specific to general contractors, but seems silent as to subcontractors and other vendors.  In other words, the Lockheed Martins and Boeings are covered, but not the thousands of smaller businesses that are subcontracted by the major companies.

The official reason for this unprecedented act is to avoid "unnecessary anxiety and uncertainty for workers", but something smells about the fact that these layoff warnings would come only four days before the election.  Whatever the motives, the government should not be agreeing to pay companies' litigation costs for breaking the law.  It is especially distasteful if this is an effort to use government resources to back up a president's reelection bid.  Imagine what Republicans could do with this precident!

"Oh don't worry about the Lily Ledbetter Act.  We'll reimburse your costs."  

"Oh, those EPA violations?  Don't worry, we'll cover your costs."  

"You won't cover contraceptives?  Don't worry, we'll cover your litigation costs."  

You get the picture.

Now I know that this will be labeled as concern trolling, and like all my other diaries, I'll be blasted.  But this kind of thing needs to be called out.  We cannot have the government agreeing to cover companies' litigation costs for violating the law, especially where it, situationally, is extremely politically convenient for a sitting president.

A write up on this issue is available here.

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