Defense contractor Lockheed Martin has agreed to pay $29.5 million to settle claims by President Donald Trump’s administration that it discriminated against white employees through its efforts to promote variety and equity in an inner bonus program.
Lockheed Martin will pay $22 million to the US authorities to resolve claims that it failed to comply with anti-discrimination necessities in its federal contracts, according to the settlement announced late Tuesday by the Justice Department and the Equal Employment Opportunity Commission.
In addition, Lockheed Martin will pay $7.5 million to more than 1,000 affected workers as half of a settlement with the EEOC, which had been investigating the company for violating Title VII of the 1964 Civil Rights Act, which prohibits employment discrimination primarily based on race.
An indication marks Lockheed Martin in Colorado Springs, Colorado, where officers demonstrated a new battle management project. Getty Images
In a assertion, Lockheed Martin denied the authorities’s allegations but 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.
The case is the newest instance of the Trump administration’s use of the 1863 False Claims Act to strain federal contractors into abandoning variety, equity and inclusion practices. The law states that contractors that make false claims to the authorities could be liable for intensive damages. Typically used to police fraud, the Trump administration has invoked the False Claims Act against corporations it maintains have pursued discriminatory practices under the guise of selling variety.
The Justice Department has reached related settlements with IBM, Deloitte and Accenture.
Civil rights teams have criticized the Trump administration’s insurance policies for taking intention at many long-established practices that are aimed at guaranteeing the hiring, promotion and other employment practices do not deliberately or unintentionally discriminate against historically marginalized teams. Several teams have filed lawsuits against the Trump administration’s anti-DEI insurance policies.
The allegations against Lockheed Martin heart around a program the company launched in 2021 to give the high 20% of workers a merit-based wage bump and promotion alternatives, according to the settlement settlement.
A Lockheed Martin F-16V fighter jet lands at Taitung’s Chihhang Air Base in Taitung, Taiwan on Oct. 2, 2026. REUTERS
Managers submitted nominations for the bonuses, which the company then ran through an evaluation to “flag” statistical outliers primarily based on the race and intercourse composition of the checklist. If the nomination checklist raised flags, managers were requested to review their nominations and the “merit-based basis for the selections, without asking them to take any protected characteristic into account.”
But in apply, according to the Justice Department, 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 requested to take away nonminorities from the alternatives and add racial minorities.
The settlement with the DOJ and the EEOC stems from complaints made by Tim Booher, a former vice president at Lockheed Martin, who will be paid $4.4 million by the US authorities under a whistleblower provision of the False Claims Act. According to a grievance he filed in federal court in October 2025, Booher resigned from Lockheed Martin in May 2023 because he “felt that he could no longer be complicit in LMC’s illegal discrimination.”
The Lockheed Martin emblem is displayed at the company’s sales space during the International Defence Industry Exhibition in Kielce, Poland on Sept. 8, 2026. NurPhoto via Getty Images
In July 2024, Booher said he met with EEOC Commissioner Andrea Lucas to element his allegations against the company. Lucas, who was elevated to EEOC chair after Trump took workplace in January 2025, filed a commissioner’s charge against Lockheed Martin, triggering the EEOC’s investigation.
Attorneys representing Booher launched a assertion applauding the “amicable conclusion that avoids prolonged litigation and ensures statutory compliance in federal contracting.”
Lucas, a vehement critic of DEI practices, has publicly urged white males to come to the EEOC with discrimination complaints and has filed her own “commissioner’s charges” against the variety practices of corporations, including Nike.
“Title VII protects every worker from employment discrimination on the basis of race — and that protection does not yield when discriminatory decisions are framed as diversity initiatives,” Lucas said in a assertion saying the settlement.