Lockheed Martin agreed to pay about $29.5 million to resolve federal allegations that it used race or sex in employment decisions and falsely certified compliance with anti-discrimination requirements in its federal contracts.
The U.S. Department of Justice announced the two agreements Tuesday. The department said the alleged conduct dates to 2019. Lockheed will pay $22 million plus interest to the United States under the False Claims Act and about $7.5 million to more than 1,000 workers under a separate U.S. Equal Employment Opportunity Commission agreement.
Lockheed denied the allegations and admitted no liability. The company said in a statement that it settled to avoid the distraction and expense of prolonged litigation.
The Fort Worth pay dispute
Tim Booher, a former Lockheed vice president who led its Combat Systems team, filed a whistleblower suit in Fort Worth in July 2025. In his amended complaint, Booher alleged that two human resources officials in Lockheed’s Aeronautics business told him in December 2022 to replace at least 18 white employees on a list for extra pay with an equal number of racial minority employees.
The Justice Department traced the pay dispute to Compensation Adder, a program that began in 2021 and offered extra raises for up to 20% of employees at each job level in a business area. Managers initially nominated workers on merit, and Lockheed checked the lists for statistical outliers by race and sex. The department alleged some HR staff pressed managers to change their picks based on race.
One HR employee told leaders that “increasing POC [People of Color] for Comp Adder will result in removing equal count of non-minority,” the Justice Department said in the signed agreement.
The government also alleged that Lockheed’s diversity, “equity” and inclusion (DEI) practices included using race or sex in hiring and promotions, tying a management pay metric to demographic targets, and using race or sex to determine eligibility for some mentoring and leadership programs.
Payments and oversight
EEOC Chair Andrea Lucas’ 2025 charge alleged that Lockheed violated Title VII of the Civil Rights Act by discriminating against white employees in performance reviews, bonuses and other pay decisions. The agency’s agreement requires merit-based hiring, pay, bonuses and promotions without regard to race or sex, and the EEOC can review compliance. The agency gave a companywide tally of workers covered and left the Fort Worth count undisclosed.
The Justice Department alleged Lockheed sought reimbursement through federal contracts for costs tied to the challenged DEI practices. Of the $22 million, the agreement designates $10 million as restitution. Booher will receive $4.4 million plus a share of interest from the federal recovery.
The agreement bars Lockheed from charging federal contracts for the DOJ settlement and related costs. Lockheed has 90 days from the agreement’s effective date to identify any such costs it previously billed and repay any amounts the government paid. Federal agencies retain audit and debarment rights.
The F-35 contracts
Booher’s complaint lists several F-35 contracts. In March, the Pentagon announced a $132.9 million modification for flight-test support on one of them, N0001922C0041. It projected that 30% of the work would take place in Fort Worth. The Justice Department’s agreement describes the billing allegations and leaves individual contracts unnamed.
Lockheed assembles F-35s in Fort Worth. The Navy awarded the company an $879 million order in May for armament work there, as previously reported by The Dallas Express. Lockheed said U.S. government work accounted for 72% of its $75 billion in 2025 sales.
