The Treasury Department has taken the significant step of terminating collective bargaining agreements with unionized workers at the Internal Revenue Service, marking a major escalation in President Donald Trump's ongoing efforts to exert greater control over the federal workforce. This decisive action was confirmed by the agency on Friday, with additional reports indicating that the union contract for the Bureau of the Fiscal Service was also terminated earlier this week.
Executive Order Provides Authority for Contract Terminations
According to sources familiar with the decision who spoke anonymously due to lack of authorization to discuss the matter publicly, Treasury officials informed workers at both agencies that their collective bargaining agreements were being terminated. The authority for these actions stems directly from an executive order signed by President Trump in March of last year, which has become a central tool in his administration's approach to federal labor relations.
IRS Leadership Communicates Decision to Employees
In a letter to IRS workers viewed by The Associated Press, IRS Chief Human Capital Officer Alex Kweskin framed the termination as part of a broader organizational strategy. Kweskin told employees that this move "deepens our commitment of operating as one IRS, a collaborative team focused on serving American taxpayers," suggesting the administration views the contract changes as beneficial to operational efficiency.
The contract terminations follow a recent memo from Scott Kupor, director of the Office of Personnel Management, who called on agency heads to comply with Trump's March order and formally notify labor unions "that they are terminating any applicable CBAs (collective bargaining agreements), whether represented by the National Treasury Employees Union (NTEU) or another labor union."
Legal Challenges and Union Response
The National Treasury Employees Union, which represents approximately 150,000 employees across 37 different federal departments and agencies including both the IRS and Bureau of the Fiscal Service, has vigorously opposed these developments. The union had previously sued the federal government over Trump's executive order, resulting in a preliminary injunction from a D.C. court that was subsequently stayed pending appeal.
In a separate legal development that has significant implications for this situation, a three-judge panel of the U.S. Court of Appeals for the 9th Circuit issued a decision on Thursday that effectively cleared the path for implementation of Trump's executive order. This ruling represents a substantial legal victory for the administration's position.
Union President Challenges Legality of Terminations
Doreen Greenwald, president of the National Treasury Employees Union, issued a strong statement on Friday challenging the legality of the Treasury Department's actions. Greenwald asserted that the IRS "cannot unilaterally end" its contract with the labor union, citing federal sector labor statutes that she claims require the agency to maintain a collective bargaining agreement "with the exclusive representative of its bargaining unit employees."
The Bureau of the Fiscal Service, which handles government payment processing operations, finds itself in the same position as the IRS following these contract terminations. Both agencies now face significant changes to their labor relations frameworks as the Trump administration continues its push to reshape the federal workforce through executive action.
