NextFin news, On Tuesday, September 30, 2025, the American Federation of Government Employees (AFGE) and the American Federation of State, County and Municipal Employees (AFSCME) filed a lawsuit in the U.S. District Court for the Northern District of California against the Trump administration. The unions are contesting the administration's plan to conduct mass firings of federal workers if the government shuts down at midnight.
The lawsuit alleges that the administration's plan to fire federal employees during a shutdown is unlawful, arbitrary, and capricious. It argues that there is no statutory authority permitting such mass terminations during a funding lapse and calls for a federal court injunction to block the plan. The unions contend that federal employees are being used as pawns in the political standoff between Congress and the administration.
The suit names Office of Management and Budget (OMB) Director Russell Vought as a defendant. The OMB had issued memos directing federal agencies to prepare for a shutdown and to draft "reduction in force" plans, which include potential layoffs beyond the usual furloughs.
AFGE National President Everett Kelley criticized the administration's approach, stating, "Announcing plans to fire potentially tens of thousands of federal employees simply because Congress and the administration are at odds on funding the government past the end of the fiscal year is not only illegal — it’s immoral and unconscionable." He highlighted that more than one-third of federal employees are military veterans.
The lawsuit was filed hours before the government funding was set to expire at midnight on Tuesday, September 30, 2025, which would trigger a shutdown. The Senate had failed to pass either the Republican-backed or Democratic-backed stopgap funding bills earlier that day, making a shutdown nearly certain.
The Trump administration has argued that the shutdown and resulting layoffs are a consequence of Democratic opposition to the House-passed funding bill. A memo sent to federal employees blamed Democrats for blocking the funding resolution, warning of furloughs and shutdown impacts.
According to the nonpartisan Congressional Budget Office, a government shutdown could furlough approximately 750,000 federal employees daily, costing about $400 million in lost compensation each day. The Trump administration's plan to go beyond furloughs and conduct layoffs would significantly reshape the federal workforce.
The unions' legal challenge underscores the heightened tensions and legal uncertainties surrounding the administration's shutdown contingency plans. The case awaits assignment to a federal judge in San Francisco.
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