Lockheed Martin agrees to $29.5 million settlement over claims it discriminated against white workers (Photo Illustration by Igor Golovniov/SOPA Images/LightRocket via Getty Images)
Lockheed Martin will pay tens of millions of dollars to settle allegations that the major defense contractor’s internal bonus program discriminated against white workers.
It’s the latest example of the Trump administration using an old law to pressure federal contractors into abandoning diversity, equity and inclusion initiatives.
Lockheed Martin settlement
Big picture view:
The settlement stems from a program Lockheed Martin started in 2021 that gave the top 20% of employees a merit-based salary bump and promotion opportunities.
Managers submitted nominations for the bonuses, which the company then ran through an analysis to "flag" statistical outliers based on the race and sex composition of the list. If the nomination list raised flags, managers were asked to review their nominations and the "merit-based basis for the selections, without asking them to take any protected characteristic into account," the Justice Department claims.
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DOJ says Lockheed Martin personnel "exerted pressure on leaders in their business group to resolve race-related ‘flags’ by directing them to add or remove particular employees based on race." The Justice Department claimed the managers were asked to remove nonminorities from the selections and add racial minorities.
Tim Booher, a former vice president at Lockheed Martin, filed a complaint with the EEOC. Booher told federal investigators he resigned from Lockheed Martin in May 2023 because he "felt that he could no longer be complicit in LMC’s illegal discrimination."
According to the AP, the federal government will pay Booher $4.4 million under a whistleblower provision of the False Claims Act.
By the numbers:
According to the Associated Press, Lockheed Martin will pay $22 million to the Equal Employment Opportunity Commission, plus $7.5 million to more than 1,000 employees who were reportedly impacted by the program.
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What they're saying:
Lockheed Martin has denied the government’s claims, but the company said it "agreed to resolve this matter with the Department of Justice and the Equal Employment Opportunity Commission to avoid the distraction and expense of prolonged litigation."
"We did not admit liability, determining it would be best for all involved to put these matters behind us so we can remain focused on our critical national security mission," the company said in a statement to the AP.
Trump’s war on DEI
Dig deeper:
The Lockheed Martin settlement is the latest case of the Trump administration using the 1863 False Claims Act to pressure federal contractors into abandoning diversity, equity and inclusion practices. The law states that contractors that make false claims to the government could be liable for extensive damages. Typically used to police fraud, the Trump administration has invoked the False Claims Act against companies it maintains have pursued discriminatory practices under the guise of promoting diversity.
The Justice Department has reached similar settlements with IBM, Deloitte and Accenture.
The other side:
Critics say the administration is attacking initiatives that work to make sure marginalized groups aren’t discriminated against when it comes to hiring, promotion and other employment issues. Several groups have sued to stop the White House’s anti-DEI actions.
The Source: This report includes information from The Associated Press.