Defense Spending Cuts Mean Election Day Lay Offs


Tens of thousands of employees of government contractors may receive dismissal notices just days before the presidential election, as a result of President Obama’s defense spending cuts, which will go into effect in early 2013, according to the Washington Post:

By law, all but the smallest companies must notify their workforce at least 60 days in advance when they know of specific job cuts that are likely to happen.

Therefore, if the defense spending cuts go into effect in early January, the contractors must notify their laid-off employees by early November, on the eve of Election Day:

The prospect of widespread layoff notices before Election Day — potentially hitting the swing state of Virginia hardest — underlines how the looming "fiscal cliff" at the end of the year is shaping the economy and politics many months in advance.

Economists say the threat of deep cuts in domestic and defense spending, coupled with automatic increases in taxes, is already a drag on economic growth and a source of enormous uncertainty for businesses, which are holding back on hiring and helping to keep the nation’s unemployment rate above 8 percent.

U.S. Department of Labor assistant secretary Jane Oates sent a letter Monday to state workforce agencies, administrators, and liaisons assuring that contractors need not inform workers that they’re being laid off right before Election Day:

Questions have recently been raised as to whether the WARN Act requires Federal contractors…to provide WARN Act notices 60 days before that date to their workers…The answer to this question is "no."