The Labor Department, warning defense contractors against announcing impending layoffs as required by law, is elevating election-year politics above sound policy, according to a former top DOL official.Paul Conway, who served as chief of staff to Labor Secretary Elaine Chow under President George W. Bush, told me that DOL’s guidance, which warns that announcements of impending layoffs as a result of Defense sequestration cuts would be “inappropriate,” “comes across as very crass.”
Under the Worker Adjustment and Retraining Notification (WARN) Act, employers are required to notify workers at least 60 days in advance of potential layoffs that they expect will hit at least 500 employees. Defense sequestration cuts are expected to lead to large layoffs for Pentagon contractors. Under current law, sequestration will take effect on January 2, meaning contractors that expect large layoffs must notify their employees by November 3 – three days before the election.
DOL said on Monday that it would be “inappropriate” for those notices to go out in November, since some in Congress are working to avert those sequestration cuts. But regardless of congressional action, current law stipulates that the cuts will, in fact, take place, and employers are required to operate under that assumption.
Conway believes DOL is trying to avoid talking about impending layoffs in the height of campaign season. “Very clearly, from our perspective,” Conway told me, “they don’t want to further a bad news story less than 100 days from an election.”
An online DOL “fact sheet” says the Department does not have enforcement authority under the WARN Act and therefore “cannot provide specific advice or guidance with respect to individual situations.” But that appears to be exactly what it has done. Indeed, Conway said he could think of “no other time that it’s been done” – certainly not when he worked at the Department.
Of course, DOL can’t instruct companies to violate the law – hence the use of the term “inappropriate,” as opposed to a one with more legal punch. But Monday’s guidance appears to be an attempt to use “the weight of the cabinet officer [Labor Secretary Hilda Solis] and the weight of the department” to pressure companies to hold off on layoff announcements, Conway said.
A handful of lawmakers on Tuesday echoed that sentiment. DOL’s guidance “lays bare the obvious political aim of today’s announcement – avoiding mass layoff notices just days before the November 6th election,” said Sens. John McCain (R-AZ) and Kelly Ayotte (R-NH) in a joint statement.
Sen. Inhofe (R-OK) accused the administration of “trying to intimidate industries to not issue pink slips until after the election.”