US State Department's planned layoffs may violate court order, judge says

By Daniel Wiessner

(Reuters) -A federal judge in California on Wednesday said her recent ruling barring President Donald Trump's administration from laying off tens of thousands of federal employees likely blocks the U.S. State Department's reorganization plan that includes 2,000 job cuts.

U.S. District Judge Susan Illston in San Francisco during a virtual meeting in a lawsuit by unions, nonprofits and municipalities said she was concerned that the State Department is flouting her May 22 order that broadly blocked government-wide mass layoffs.

Illston temporarily blocked about 20 agencies, including the State Department, from carrying out plans to downsize and restructure federal agencies at Trump's direction. But the department told Congress last week that it still planned to notify about 2,000 employees this month that they were being laid off and would reorganize or eliminate more than 300 bureaus and offices.

“At this point there are some semantics being bandied about, but it appears to me that what is being implemented at the State Department now is covered by the injunction,” said Illston, an appointee of President Bill Clinton, a Democrat.

Illston ordered both sides to file briefs on the matter next week and said she would hold a hearing by June 13, the earliest date that State can issue layoff notices after it submitted its plan to Congress.

In her May ruling, Illston said the White House cannot order the restructuring of federal agencies without authorization from Congress. The Trump administration has asked the U.S. Supreme Court to pause Illston's decision while it appeals, after a San Francisco-based federal appeals court refused to permit the pause.

Illston's ruling was the broadest of its kind against the government overhaul that was spearheaded by Trump ally Elon Musk, the world's richest person and CEO of electric vehicle maker Tesla. Musk last week said he was ending his stint with the administration, raising questions about the future of his Department of Government Efficiency.

During Wednesday's 30-minute meeting, U.S. Department of Justice lawyer Andrew Bernie argued that the State Department's reorganization plan predated a February executive order and subsequent White House memo directing mass layoffs, placing it outside the scope of Illston's decision.

“We of course recognize and take with the utmost seriousness our obligation to comply with the injunction, and we are complying,” Bernie said, adding that 17 federal agencies have halted planned layoffs.

But Danielle Leonard, a lawyer for the plaintiffs, countered that State Department documents and statements regarding the planned layoffs specifically reference orders from the White House.

“We've heard some things from Mr. Bernie today, but we haven't seen anything sworn under penalty of perjury saying this was … independently done,” she said.

Illston had convened Wednesday's meeting after the plaintiffs in a filing late Tuesday accused the State Department and the U.S. Department of Housing and Urban Development of not complying with her decision.

They said that HUD had fired about 80 employees who had not completed a probationary period, which Bernie on Wednesday confirmed. But he said that agencies have broad latitude to fire probationary workers, and those terminations were not the same as the mass layoffs of tenured employees that were blocked by Illston.

Probationary workers typically have less than a year or two in their current roles, though some are longtime federal employees in new positions.

Illston said it was not clear to her whether the firings at HUD were covered by her injunction.

(Reporting by Daniel Wiessner in Albany, New York and Blake Brittain in Washington, D.C., Editing by Alexia Garamfalvi and Aurora Ellis)