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SCOTUS Unfreezes Trump's Plan to Slash Federal Agencies

Vaidehi Mehta, Esq.

Article by: Vaidehi Mehta, Esq.

Attorney Writer

Reviewed by Joseph Fawbush, Esq. | Last updated on

This past Tuesday, the U.S. Supreme Court issued a brief order granting the Trump administration’s request to pause a preliminary injunction that had blocked the president from his favorite activities: issuing executive orders and firing people.

The order in question represents one of the most sweeping attempts to restructure the federal government in decades. The legal battle over this directive has deep roots in Trump's first-term conflicts with federal employee unions and one particular Supreme Court justice.

Trump’s Term Two Triage

In February of this year, not long after resuming office for his second term, Trump issued Executive Order 14210, a directive that set in motion what the administration called a “critical transformation” of the federal bureaucracy. The order commanded agency heads to “promptly undertake preparations to initiate large-scale reductions in force (RIFs), consistent with applicable law,” and to submit reorganization plans for approval by the Office of Management and Budget (OMB) and the Office of Personnel Management (OPM).

This was not just a matter of trimming a few positions here or there. The order and memorandum that followed required agencies to slash all functions not explicitly mandated by statute, consolidate or eliminate offices, and cut half or more of the workforce in many cases. The plans were to be drawn up and submitted at breakneck speed (within weeks), with OMB and OPM holding the authority to approve or reject them. Agencies reported that OMB and OPM were not simply offering guidance but actively rejecting plans that did not go far enough in cutting staff and programs.

By March and April, the effects were already being felt across the federal government. Agencies began issuing RIF notices, placing employees on administrative leave, and shuttering offices. This impacted public services like disease surveillance, disaster relief, and veterans’ healthcare.

Federal Federations File Suit

The American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) is the biggest federation of labor unions in the country, representing over 12 million active and retired workers. The AFL-CIO is an umbrella organization made up of 60 national and international labor unions, including unions for teachers, government employees, construction workers, healthcare workers, and many others.

The American Federation of Government Employees (AFGE) is a constituent union of the AFL-CIO. It’s the largest federal employee union in the United States, representing over 700,000 workers across federal agencies and the District of Columbia government.

On April 28, the AFL-CIO (and others) filed suit in the Northern District of California challenging EO 14210. They argued that Trump had overstepped his authority, bypassing Congress in a way that threatened the separation of powers and the statutory framework for the federal workforce.

On May 22, Judge Susan Illston issued a preliminary injunction halting the Trump administration’s plans for large-scale federal workforce reductions and agency reorganizations. She found that Trump lacked constitutional and statutory authority to unilaterally order large-scale reorganizations and layoffs of federal agencies without congressional approval. The judge emphasized that, historically, presidents have sought and obtained congressional authorization before undertaking such reorganizations.

Trump’s Term One Weed-outs

The California lawsuit was not the first legal challenge to the Trump administration’s attempts to reshape the federal workforce. In fact, it was a bit of déjà vu from Trump’s first term, where AFGE took the president to court over similar executive orders.

In May 2018, Trump signed a series of three EOs that aimed to reshape the landscape of federal labor relations. The orders targeted longstanding practices involving collective bargaining, the use of official time for union activities, and procedures for employee discipline and removal. The Trump Administration justified the orders as necessary changes to promote efficiency and accountability in the federal workforce.

The first order sharply limited the use of “official time,” which is basically the hours during which federal employees (who are also union representatives) can engage in union-related activities while still being paid by the government. The second order streamlined procedures for disciplining and removing federal employees who were deemed underperforming or engaged in misconduct. The third order tackled the collective bargaining process itself, imposing strict new deadlines for contract negotiations, requiring agencies and unions to conclude bargaining within a year.

With these orders, the Trump administration was purportedly trying to shift the balance of power toward agency management. And that did not sit well with many federal employees. For AFGE and other unions within the AFL-CIO, Trump’s EOs represented a direct attack on their fundamental rights and the protections afforded to federal employees. The orders were seen as a threat to the collaborative labor-management relationships that had developed over decades.

Jackson’s Injunction

Almost immediately, AFGE and several other federal employee unions filed suit in the U.S. District Court for the District of Columbia. Their complaint alleged that the executive orders violated the Federal Service Labor-Management Relations Statute (FSLMRS), a law passed by Congress in 1978 to govern labor relations in the federal sector. The unions argued that the orders effectively rewrote the statute by executive fiat, stripping away rights that Congress had deliberately enshrined. They contended that the orders undermined collective bargaining and threatened the independence of the federal workforce.

Trump argued that he possessed broad authority to manage the federal workforce and that the orders did not conflict with the statute. Trump's lawyers claimed the orders merely sought to enforce the principles of efficiency and accountability already embedded in federal law. They also contended that any disputes over the implementation of the orders should be resolved through the Federal Labor Relations Authority (FLRA), not the courts.

The case moved quickly, with Judge Ketanji Brown Jackson ruling against the Trump administration in August 2018 while at the federal District Court in D.C. (this was before she was appointed to the Supreme Court). She found that significant portions of the executive orders were inconsistent with the FSLMRS and thus unenforceable, concluding that Trump had overstepped his authority by issuing directives that “eviscerated” the statutory rights of federal employees. Judge Jackson enjoined the government from implementing the contested provisions of the orders, a decision that was widely celebrated by union leaders and their supporters.

D.C. Circuit Dismisses First Case

But the story did not end there. The Trump administration appealed the ruling to the U.S. Court of Appeals for the District of Columbia Circuit. The government argued that Judge Jackson’s court lacked jurisdiction to hear the case in the first place. According to the administration, the FSLMRS required unions to bring their grievances before the FLRA, not in federal court. The appellate court agreed. In a decision issued in July 2019, the D.C. Circuit vacated Judge Jackson’s injunction and dismissed the case for lack of jurisdiction.

The appellate panel’s reasoning was rooted in the structure of the FSLMRS. The statute established a comprehensive scheme for resolving labor disputes, with the FLRA serving as the primary forum for adjudication. The court concluded that Congress intended for challenges to executive orders affecting labor relations to be funneled through the FLRA process. The unions, the court held, should have pursued their objections through administrative channels before seeking judicial review.

As we saw with this year’s AFL-CIO lawsuit from California, the D.C. Circuit’s decision in the AFGE suit did not resolve the underlying conflict over the executive orders themselves. Instead, it sent the parties back to the drawing board, requiring unions to challenge the orders as they were applied in specific cases rather than in a sweeping, preemptive lawsuit. For many federal employees, this meant a slower and more piecemeal approach to contesting the administration’s policies.

SCOTUS Lets EO Stay

What came of the litigation around the EO from Trump’s current term? Remember, Judge Illston granted the unions their injunction, which would have stopped the Trump administration from rolling out RIF plans and essentially kept countless federal workers on the job.

But this past Tuesday, the U.S. Supreme Court got involved. They’ve just issued a stay putting the California district court’s injunction on hold while the government appeals to the Ninth Circuit (and, potentially, while any petition for Supreme Court review is pending). The Court found that the Trump administration is “likely to succeed” with the argument that EO 14210 is lawful. So, the Court’s staying the injunction, i.e., cancelling out Judge Illston’s cancellation of the EO.

SCOTUS did emphasize that it was not expressing any opinion on the legality of any specific agency reorganization or RIF plan that might be created under the order—those questions aren’t before them yet, they’re still pending litigation at lower courts. If the Supreme Court later declines to hear the case, the stay will end automatically. If SCOTUS grants full review, the stay will end when it issues its final judgment on the merits.

Jackson Sticks to Guns

Of course, the Court was not unanimous in this ruling. Can you guess which Justice was not part of the majority?

To no one’s surprise, given her 2018 ruling on the AFGE case, the now Justice Jackson dissented, arguing that a president cannot unilaterally reorganize federal agencies in ways that go beyond what Congress has authorized. She emphasized the long history of congressional involvement in major reorganizations and the lack of current statutory authority for such sweeping changes. Justice Jackson criticized the majority for overriding the district court’s fact-based conclusions and for allowing potentially “irreparable harm” to the federal workforce and public services before the legality of the executive actions can be fully litigated.

She’s certainly consistent.

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