Lockheed to Pay $175M in Severance to 4K Employees

Lockheed Martin expects to pay $175 million in employee severance costs as a result of its plans to close four plants, including the one in Newtown, according to a report published by the Syracuse Post Standard.

The company announced in November it intends to close four plants by the end of 2015 and eliminate 4,000 jobs nationwide as part of a consolidation plan.  As a result of the closure, 800 of the 1,050 employees who work at the Newtown location, which specializes in space systems, will be laid off.

According to the Post Standard report, Lockheed severance payments will total $115 million after tax. Terminated employees will receive lump-sum severance payments based on years of service, the report said.

Other facilities that will be closed include locations in Akron, Ohio, Goodyear, Ariz. and Horizon City, Texas.

The Newtown facility will close by early 2015 with most commercial and military satellite work transferring to Lockheed Martin’s Denver, Colo., facility, the company announced. It will be a phased process over the next 12 to 18 months, according to details from the company.

In a statement, the company said the measures are being taken to improve the affordability of its products and services.

“These actions are in response to continued declines in U.S. government spending,” the company said in a statement.