Virginia Contractor Sends WARN Act Layoff Notices

Company hasn’t faced actual cuts to contracts yet, spokesman says.

A Reston, Va.-based government contractor sent employees notices of potential layoffs due to across-the-board budget cuts from sequestration,The Washington Post reported.

Serco Inc. sent out Worker Adjustment and Retraining Notification Act notices to 770 employees in Maryland and Virginia. Candy Curtin, the company’s senior vice president for human resources, told the Post Serco was “advised by an attorney” that the notices would be the “best course of action.”

A spokesman for Serco told Government Executive that the “notices were sent out only as a possibility of what may happen due to sequestration,” and that so far “nothing has happened “ to Washington, D.C., area contracts that would necessitate layoffs.

The 1988 WARN Act requires any company with more than 100 employees to issue layoff notices 60 days in advance of any mass layoff or plant closure.

The Office of Management and Budget told contractors last September to hold off on WARN Act notices, citing the guidance issued by the Labor Department in July 2012. At the time it was unclear whether sequestration -- designed as a last resort if deficit reduction talks failed -- would take effect. However, with sequestration well under way, contractors have been relatively quiet about its impact to their current business situations.

Several major companies including Lockheed Martin Corp., Boeing Co., General Dynamics Corp., and BAE Systems have pursued layoffs as part of a general cost-cutting strategy in the face of falling demand, and a tougher government contracting and defense market.  Still, none of the layoffs so far have been attributed to sequestration-related cuts, and the companies are still waiting for program specific impacts before making any workforce decisions.