Republican members of the Senate contacted several defense contractors last week informing them that they risk financial penalties for not following laws requiring employees to be warned of their potential lay-off.
Fifteen defense contractors claimed to have been advised that the timeline for the federal government to cut $55 billion in spending, which would eliminate programs the companies are responsible for, allows them to delay issuing the notices, according to a report by The Hill.com.
The Worker Adjustment and Retraining Notification (WARN) Act requires companies to notify employees if their positions are in danger of being eliminated.
Senators Lindsey Graham, R-S.C., and John McCain, R-Ariz., sent a letter to the companies, warning them of penalties for violating the WARN Act based on guidance from the administration.
The spending cuts are scheduled to take effect on January 2, and could result in the elimination of up to 1 million jobs at the companies. Republican and Democrats have spent most of the year since the budget cuts were signed into law attempting to agree on a way to avoid them, though no progress has been made on a deal during that time.
Republicans in Congress charge that the Obama Administration is attempting to hide job losses by offering payouts to the companies to cover the expenses of the lay-offs.
According to defense analysts, there is no danger of the companies violating the WARN Act because the contracts will not automatically be cut on January 2, allowing the notices to be sent out in time for the 60-day timeframe, the analysts said. This, they said, would keep the payouts from being necessary at all.
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