Lockheed Martin has agreed to pay about $29.5 million to settle federal allegations involving its workplace diversity programs. The defense contractor was accused of considering race or sex in some employment decisions while certifying that it followed federal anti-discrimination requirements, according to the U.S. Justice Department . The claims are allegations, and there has been no finding that the company is liable.
The settlement has two parts. Lockheed Martin will pay $22 million to the U.S. government to resolve allegations involving its federal contracts. Another $7.5 million will go to more than 1,000 workers under an agreement with the U.S. Equal Employment Opportunity Commission . The agency alleged white employees faced discrimination in performance reviews, bonuses and other pay decisions.
One part of the case centered on a Lockheed Martin program called "Compensation Adder." Beginning in 2021, the program offered extra raises to the top 20% of employees in each business area. Federal officials alleged some human resources employees pressured managers to change selections based on race after bonus lists were reviewed for racial and gender disparities, according to details released by federal officials .
Lockheed Martin denied the government's allegations and did not admit liability. The company said it agreed to settle to avoid the cost and distraction of a long court fight, according to a statement reported by the Associated Press . The defense contractor said it wanted to remain focused on its national security work.
The case also fits into a broader push by President Donald Trump's administration against some workplace diversity, equity and inclusion practices. The Justice Department has used the False Claims Act, a law often used in fraud cases, to challenge federal contractors over alleged discrimination. Similar settlements have been reached with IBM, Deloitte and Accenture, the Associated Press reported .
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