A federal judge has temporarily barred the U.S. government from conducting reductions in force (RIFs) during the ongoing government shutdown, delivering a major victory to employee unions challenging the legality of the layoffs. Senior U.S. District Judge Susan Illston criticized federal agencies for taking advantage of the shutdown to bypass established legal protections, saying "the evidence suggests that the Office of Management and Budget and the Office of Personnel Management have taken advantage of the lapse in government spending ... to assume all bets are off."

The unions argued that issuing RIF notices violates the Antideficiency Act, which prohibits the government from spending money it doesn't have. Judge Illston agreed that the unions are likely to prove their case, finding that the administration's issuance of more than 4,000 layoff notices during the shutdown was illegal, exceeded its authority, and was arbitrary and capricious. She ordered the administration to issue no further RIF notices and to take no action to enforce those already sent.

According to the unions' Oct. 14 court filing, "the uncontroverted record establishes that defendants have been and are continuing to direct federal employees to work illegally during the shutdown, preparing and issuing RIF notices to their fellow employees."

The Justice Department attempted to argue procedural grounds, claiming the RIFs did not represent a final agency action and that the court lacked jurisdiction. However, when pressed in court, the DOJ attorney admitted she was unprepared to discuss the merits, prompting Illston to respond sharply: "This hatchet is falling on the heads of employees all across the nation, and you're not even prepared to address whether that's legal?"

The initial wave of RIF notices affected approximately 4,100 employees across multiple federal agencies, including Commerce, Education, Energy, Health and Human Services (HHS), Housing and Urban Development, Homeland Security, Treasury, and the Environmental Protection Agency. USDA was not impacted.

The fallout was compounded by errors at HHS, where nearly 800 employees were mistakenly sent layoff notices due to data discrepancies and processing errors. These workers, many at the Centers for Disease Control and Prevention, are now being reinstated, according to a declaration from OMB senior adviser Stephen Billy.

Judge Illston also ordered the government to provide detailed information on the RIF notices already issued and any additional agency plans. Union sources say several other departments were contemplating similar actions before the ruling.

The decision represents a significant check on the administration's ability to reshape the federal workforce during a funding lapse. While temporary, the order halts further layoffs and strengthens the unions' case ahead of a formal legal ruling.