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OMB Initiates Process for Government Reorganization and Downsizing

2017-04-18

Administration requires all federal executive agencies to start planning to reorganize and downsize

On April 12, 2017, OMB Director Mick Mulvaney delivered a 14-page “Memorandum” to all federal Executive Branch agencies to start the plans for downsizing and reorganizing.   As part of the planning, senior White House staffs met with CEOs to obtain their suggestions for reorganization.  Mulvaney also said that they are looking at the possibility of restructuring by combining common functions from across government departments.  That has brought some speculation of merger discussions between OFCCP and the EEOC.

Here is a timeline of all correspondence addressing federal employment in the new administration. 

• January 23, 2017 – a Presidential Memorandum established an immediate hiring freeze in the Executive Branch of the government.  This was an immediate action to halt the growth of the federal workforce until a “long-term plan to reduce the size of the Federal Government’s workforce is put into place.”  The April 12th Memorandum lifted this hiring freeze; however, directed the agencies to create specific agency plans to force agency closures, employee transfers and termination.

• March 13, 2017 – President Trump issued an Executive Order directing agencies to start the process of reorganizing along the lines of the President’s FY 2018 budget.  The agencies were directed to start a top-to-bottom review of the need and utility of every federal Executive Branch agency with the goal of rooting out duplication and unnecessary cost.  Agencies have until March 13, 2018 to submit a reorganization plan.  The plan should identify substantial near-term change in early 2018 and long term and final change to the FY 2019 initial budget submission due to OMB in September 2017. 

• March 16, 2017 – Trump’s “Budget Blueprint” was submitted to Congress which gave guidance as to how the agencies should make budget cuts.  The Blueprint Budget failed to provide sub-Department budgets but provided large agencies, such as the Department of Labor, with general guidance about its cuts.  The Department of Labor was informed that they may experience 20.7% ($2.5B) budget cuts but only after Congressional approval.

• June 30, 2017 – Agencies must provide and send to OMB “high-level” drafts of their “Agency Reform Plans” and have developed a Plan to “maximize employee performance.”

• September 2017 – Agencies must submit “Agency Reform Plans” to OMB, including long-term workforce reductions.

• Early 2018 – “Real, tangible ideas” to reorganize the federal government will be published.  

The foregoing has been prepared for the general information of clients and friends of Workplace Dynamics LLC and is not being represented as being all-inclusive or complete. It has been abridged from legislation, administrative ruling, agency directives, and other information provided by the government. It is not meant to provide legal advice with respect to any specific matter and should not be acted upon without professional counsel.