H.R. 10194: Preventing Revenue Opportunities for Workplace Lockouts and Retaliation Act

This bill would reduce certain federal benefits for employers that lock out their employees during labor disputes.

What counts as a lockout

A “lockout” generally means an employer prevents employees from working as part of a labor dispute. The bill uses that meaning from labor law.

Federal funds would be blocked during a lockout

Starting January 1, 2026, an employer would not be allowed to receive, use, or spend federal funds during any period when it is locking out employees.

The bill also adds a follow-on restriction after the lockout ends:

• If the employer has no earlier lockout period, the federal funding ban would continue for a period equal in length to the lockout itself.
• If the employer has had another lockout period before, the ban would last for one year after the lockout ends.

The bill also says that if an employer received or used federal funds in violation of this rule during a lockout period that began on or after January 1, 2026 and before the bill becomes law, the employer must pay the federal government back.

Tax credits would generally be denied to corporations that lock out workers

The bill would also change the tax code so that a corporation engaged in a lockout during a taxable year would lose eligibility for most federal tax credits tied to that year.

• If the lockout is the corporation’s first one in that year, credits would be denied only to the extent they are connected to the lockout period.
• If the corporation has another lockout period in the same taxable year, it would lose all credits for that year.

The bill makes one exception: a credit that is directly tied to the corporation paying tax itself would still be allowed.

How the tax rule would apply

For these purposes, corporations under common control can be treated as a single corporation. The Treasury Department, working with the Labor Department, would be allowed to issue rules or guidance to carry out the provision.

When the tax changes would start

The tax-credit changes would apply to taxable years beginning after December 31, 2025.

Relevant Companies

None found