UTC, BAE warn government shutdown to affect their workers

Oct. 3, 2013 at 5:17 PM   |   Comments

WASHINGTON, Oct. 3 (UPI) -- U.S. defense sector companies are warning that the U.S. government shutdown, affecting an estimated 800,000 workers, will soon affect their employees.

United Technologies Corp. (UTC) said thousands of its workers could be furloughed since inspectors of the Defense Contract Management Agency (DCMA) – deemed non-essential personnel and now off the job – aren't available to audit and approve operations throughout the manufacturing process for military products.

BAE Systems, which said its workers will continue to receive salaries and benefits for the remainder of this week, also warned the shutdown could affect affect some of its programs and workers.

And engine-maker Pratt & Whitney, a UTC company, announced the shutdown has already resulted in the company stopping some work.

"Pratt & Whitney continues to monitor the process in Washington, D.C.," it said in a news release. "Various contracting activities for our military engines business have been suspended due to the shutdown.

"Lack of DCMA support is already affecting Pratt & Whitney production engine deliveries, spare part deliveries, and progress in engine component improvement programs.

"The government shutdown directly affects our ability to meet our military customers' mission requirements," it said.

The shutdown has been caused by a partisan stalemate between Democrats and Republicans in Congress over temporary funding of government programs until a new budget is passed. Democrats, and President Obama, insist the Patient Protection and the Affordable Care Act – popularly known as Obamacare -- must be funded -- now. Republicans want to withhold funding for Obamacare or amend provisions of enactment. The result is no agreement in Congress to continue the funding of government programs.

Government employees judged not essential to the running of key programs such as entitlement programs, law enforcement and national defense, have been furloughed without pay since Tuesday, the start of the fiscal year.

"Without the required DCMA inspectors, who were deemed non-essential federal employees, certain defense manufacturing work must be halted, which will result in employee furloughs," UTC said.

"United Technologies' Sikorsky Aircraft, which produces the Black Hawk helicopter, will be impacted immediately, with nearly 2,000 Sikorsky workers expected to be placed on furlough Monday, Oct. 7. This includes employees at Sikorsky facilities in Stratford, Conn., West Palm Beach, Fla; and Troy, Ala."

UTC said if the shutdown continues through next week, furloughs of workers could double to 4,000 employees and top 5,000 if the government shutdown continues into next month.

BAE Systems told its employees "we need to be prepared for anything."

"Impact to our company could vary greatly, from little to none on programs that have long-term funding, to significant and immediate on those that don't," it said. "In addition, the consequences of the shutdown likely will differ not just by sector and site, but by contract and individual work group. "

It said for the remainder of this week "at least" employees would continue to receive salaries and benefits and non-union employees would continue to receive benefits for up to 90 days, while benefits for bargaining-unit employees are governed by collective bargaining agreements.

"Your leadership is working hard to assess the potential impact if the funding impasse continues, and we will keep you informed of our progress and provide as much notice as possible of furloughs or other actions affecting employees," it said.

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