Prioritizing the Warfighter in Defense Contracting Act of 2026

Key Points

• Large defense contractors (those earning over $250 million per year from DoD contracts) would be banned from buying back their own stock or paying dividends to shareholders as a condition of doing business with the Pentagon.
• Top executive pay at these companies would be capped at $5 million per year, and bonuses could no longer be tied to short-term financial metrics like earnings per share or stock buybacks.
• Companies that consistently deliver on time and meet performance standards can apply for a waiver. They must hit an 80% threshold across delivery dates, readiness requirements, technical performance, and cost data submission timelines.
• The bill gives the Pentagon a wide range of enforcement tools if companies break the rules, from suspending payments and canceling contracts to clawing back executive bonuses and referring cases for criminal prosecution.
• The Department of Defense must publish annual and quarterly reports to Congress listing which contractors are subject to these rules, which received waivers, and which violated their certifications. These reports would be made publicly available.
• The bill was introduced with unusual bipartisan backing from Senators Warren and Hawley, reflecting shared frustration across the political spectrum with defense contractor performance and executive enrichment at taxpayer expense.