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White House discourages layoff warnings

Associated Press Modified: October 3, 2012 at 4:17 pm •  Published: October 3, 2012
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"Companies have a choice whether to rely on OMB's politically motivated guidance or to comply with the law," McCain said in a statement Wednesday. "But I can assure them that I will do everything in my power to ensure that taxpayer dollars are not used to compensate contractors who do not comply with the law."

McCain says he warned Defense Secretary Leon Panetta that he would deny any transfer of funds among defense accounts to pay for legal costs associated with contractors' failure to provide 60 days advance notice of layoffs.

In July, the Labor Department told contractors it would be "inappropriate" for employers to send such warnings because it is still speculative if and where the $110 billion in automatic spending cuts might occur. By law, about half the cuts would be in defense spending.

In a statement, Lockheed Martin said it was reassured by the latest OMB guidance that any action to cut defense contracts would not occur for several months after Jan. 2. After reviewing the guidance, the company said it would not issue warning notices this year.

Gould, a former chairman of the National Labor Relations Board under President Bill Clinton, said he believes the law supports the government's position that warnings are not necessary.

"At this juncture sequestration is a possibility and nothing more, and that does not trigger the obligation to issue the 60-day notice," he said.

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