Labor & Employment Law Daily Wrap Up, LITIGATION NEWS, TRENDS—Lockheed Martin to pay $29.5M to settle DEI-related discrimination allegations, (Nov 4, 2026)

By Patricia K. Ruiz, J.D.

According to the Justice Department, this is the “largest class of workers to publicly recover under an EEOC settlement on account of alleged Title VII violations arising from or relating to a DEI program or practices.”

Lockheed Martin Corp. has agreed to pay $29.5 million to resolve allegations that it discriminated against employees and job applicants based on race and sex through compensation, hiring, promotion, and career-development practices, federal authorities announced. The settlement consists of a $22 million agreement with the U.S. Department of Justice under the False Claims Act and a related agreement with the U.S. Equal Employment Opportunity Commission (EEOC).

According to the DOJ’s announcement, “This is the largest class of workers to publicly recover under an EEOC settlement on account of alleged Title VII violations arising from or relating to a DEI program or practices.”

The company denied the allegations and the settlement is not an admission of liability.

False Claims Act allegations. According to the settlement, the government alleged that Lockheed Martin Corporation certified compliance with federal anti-discrimination requirements incorporated into its government contracts while knowingly maintaining employment practices that discriminated based on race or sex. The government further alleged that Lockheed sought payment and reimbursement under federal contracts for costs associated with those practices.

The covered conduct allegedly occurred from January 1, 2019, through the effective date of the settlement. Among other allegations, the government contended that Lockheed took race into account in awarding additional compensation through a program known as “Compensation Adder” or “Comp Adder.” The settlement describes allegations that some human resources personnel pressured business leaders to modify employee selections to address race-related statistical “flags,” including removing some nonminority employees and adding minority employees.

Hiring and promotion claims. The government alleged that Lockheed considered race or sex in hiring and promotion decisions in pursuit of workforce composition goals. According to the settlement, company business units tracked demographic goals for women and minorities, and certain incentive compensation metrics incorporated achievement of demographic objectives. The government alleged that Lockheed established companywide hiring goals characterized as “aspirational plus” goals.

Leadership-development programs. Federal authorities alleged that certain training, mentoring, leadership-development, and similar opportunities were offered on the basis of race or sex. The settlement cites an Executive Leadership Diversity Mentoring program and alleges that such programs were designed to enhance participants’ career prospects through sponsorship and networking opportunities.

Settlement terms. Under the False Claims Act settlement, Lockheed will pay $22 million, including $10 million designated as restitution, plus interest. The agreement provides for relator Tim Booher to receive $4.4 million plus a proportionate share of interest. The settlement resolves civil claims under the False Claims Act and related theories but preserves certain government claims, including criminal liability and liabilities unrelated to the covered conduct.

The settlement notes that Lockheed simultaneously executed a separate agreement to resolve an EEOC commissioner’s charge concerning related matters. Together, the DOJ and EEOC resolutions total $29.5 million. Lockheed denied engaging in the alleged discriminatory conduct and denied the allegations in the litigation.

The case is No. 4:25-cv-00769.

Companies: Lockheed Martin Corp.

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