Last Updated: July 8, 2026 Reading Time: 9 min

Update, September 4, 2026: Judge Illston ruled September 2 that the reorganization claims in this lawsuit do not belong in the existing case and must be refiled separately. She did not rule on whether USDA's relocation plan is a RIF in disguise. No injunction is in effect, and the reported September 30 separation date for employees in some components who decline relocation stands. (Individual letters and later court orders set the dates that apply; see the October 4 update.) Watch for a standalone USDA suit reasserting the appropriations-rider and RIF-in-disguise claims.

On July 2, a coalition of unions filed a supplemental complaint arguing that the USDA reorganization is a RIF in disguise: a workforce cut engineered to avoid the exact legal protections that a formal reduction in force would hand employees. The evidence at the center of the case is USDA's own planning document, which set reduction targets of 23% to 47% and counted on relocation refusals to hit them. Here is the law being sidestepped, the nine specific rights at stake, and what to do before your letter's deadline, subject to any court stay.

Update, October 4, 2026: A separate lawsuit, AFGE v. USDA (N.D. Cal., No. 3

), produced an administrative stay on September 14, 2026. On October 2 the judge extended it through October 13 for eight USDA components: the Food and Nutrition Administration, the Research, Education, and Economics mission area, the Forest Service, the Foreign Agricultural Service, Rural Development, Farm Production and Conservation, the Office of the General Counsel and the Office of the Assistant Secretary for Civil Rights. During the stay, covered employees cannot be separated or disciplined for declining or not relocating. The order covers relocation directives under the challenged reorganization plan and does not reach moves within the National Capital Region. FSIS and APHIS are not on the list. The court has set no ruling date. See the four ways the ruling can go.

The Lawsuit in 60 Seconds

The case is American Federation of Government Employees v. Trump, No. 3

, before Judge Susan Illston in the Northern District of California. The original suit, filed in April 2025, challenged the executive order directing government-wide RIFs. The July 2 supplemental complaint adds USDA-specific claims and asks the court to block the department from reorganizing, closing or moving offices, sending more relocation notices, or removing employees who already declined.

More than 30 plaintiffs are on the case, including AFGE, AFSCME, SEIU, and a list of nonprofits, cities, and counties. Democracy Forward and Altshuler Berzon LLP lead the legal team. Judge Illston granted a broad injunction against agency RIFs once before, in May 2025, so the request is not a long shot on its face.

The injunction motion failed on September 2, 2026, on procedural grounds. A new suit did produce a court order: an administrative stay issued September 14 and extended through October 13, 2026 for reassignment directives under the challenged plan in eight named components, excluding moves within the National Capital Region.

What USDA Actually Did

USDA submitted an Agency RIF and Reorganization Plan (ARRP) to OMB in April 2025. The plan set explicit reduction targets by component:

USDA Component Planned Cut
Rural Development 47%
Food and Nutrition Service 46%+
Agricultural Research Service 43%
Economic Research Service 43%
National Institute of Food and Agriculture 39%
Natural Resources Conservation Service 34%
Foreign Agricultural Service 28%
Forest Service 15%
USDA overall 23% (31% excluding inspection)

Instead of running a formal RIF to reach those numbers, USDA proposed relocating approximately 2,600 Washington-area positions to hub cities like Kansas City, Salt Lake City, and Raleigh, and sent directed reassignment letters. Report dates vary, so check your own letter.

The ARRP itself said the quiet part: USDA anticipated "a significant number of employees will decline geographic reassignments." Union surveys bear that out. Roughly 80% of Food and Nutrition Service staff and 75% of Agricultural Research Service researchers say they will not move. The workforce has already fallen from about 98,000 to 77,500 since 2024.

That is the pretext argument in one sentence: the agency wrote down a workforce reduction target, then used relocations it expected people to refuse as the mechanism to hit it.

The 9 Rights You Lose When a RIF Becomes a "Reorganization"

This is the heart of the dispute, and the part that matters most if you hold a relocation letter. Under 5 CFR Part 351, a separation caused by reorganization is supposed to trigger RIF procedures. USDA instead classified the moves as directed reassignments under 5 CFR Part 335, which means a refusal becomes an adverse action removal under Part 752. Same outcome for the employee, very different rights:

Protection Formal RIF (5 CFR 351) Directed Reassignment + Removal
60-day advance written notice Required Not required
Bump rights (displace less-senior employee) Yes, up to 3 grades below No
Retreat rights (return to a prior position) Yes No
Competitive retention register Yes No
Veterans preference in retention Yes, significant Does not apply
MSPB appeal standard Agency must prove procedural compliance Employee must prove the reassignment violated law
Pay retention if downgraded Available Generally unavailable
Severance pay Available Available (declining outside-area move counts as involuntary)
Locality pay Preserved; you compete in your commuting area Lost on relocation

The locality line deserves a number. A GS-12 Step 5 moving from Washington, D.C. (33.94% locality) to Kansas City (18.97%) gives up about $13,000 per year in pay, $116,071 down to $103,098, before counting a single moving box. Run your own grade and city through the GS Pay Calculator to see the exact delta.

The Transfer-of-Function Question

The unions' sharpest regulatory argument involves a piece of RIF law most employees have never heard of. Under 5 CFR Part 351, Subpart C, a "transfer of function" happens when work ceases in one competitive area and moves to another that did not previously perform it. When that happens, employees performing the function get the right to follow it, and those who cannot compete under full RIF procedures.

Washington, D.C. and Kansas City are different commuting areas. Moving the Economic Research Service or Food and Nutrition Service work from one to the other looks like the textbook case the regulation describes. USDA's counter is that this is internal restructuring within its existing competitive area structure, not a statutory transfer of function. The court will have to pick one reading.

There is precedent for skepticism. The MSPB held back in Losure v. Interstate Commerce Commission (1980) that it "will not allow the circumvention of adverse action procedures where the 'reorganization' has no substance and is in reality a pretext for summary removal."

The Appropriations Problem Nobody Is Talking About

Buried in the FY2026 consolidated spending bill is rider language barring USDA from using appropriated funds to relocate offices or employees, or to reorganize or eliminate programs, without congressional approval. Congress had already rejected USDA's proposed cuts during the budget process. USDA never obtained the approval and proceeded anyway.

That claim may matter more than the RIF-in-disguise theory, because it does not require a judge to referee what counts as a "real" reorganization. Spending money in violation of an appropriations restriction is a straightforward statutory violation. If the court agrees, the relocations were unlawful regardless of how the personnel actions were labeled.

What to Do If You Hold a Relocation Letter

If you are not retirement-eligible and plan to decline: If you decline and are separated, your letter and any applicable stay set the date. Severance under 5 U.S.C. 5595 depends on meeting its eligibility requirements. Estimate your payment with the free Federal Severance Pay Calculator so you know the number before you finalize anything.

If you are retirement-eligible (50 with 20 years, or any age with 25): You likely qualify for Discontinued Service Retirement, and here is the trap: if you are eligible for an immediate annuity and do not elect it, you cannot collect severance. For most people DSR beats a severance check over a lifetime. Model it with the FERS Retirement Calculator and the VERA vs VSIP Decision Calculator, and check the VERA Eligibility Checker if you are near the thresholds.

If you accepted the move: Accepting is not protection. An employee who accepts and later backs out is separated under the same adverse action rules as someone who declined on day one. Lock in your locality pay math before you commit.

Everyone: The injunction bid failed September 2, 2026, on procedural grounds; the judge sent the reorganization claims to a new lawsuit rather than ruling on them. An administrative stay in the new case now runs through October 13, 2026 for reassignment directives under the challenged plan in eight named components, excluding moves within the National Capital Region. If your component is not covered, decide on the agency's clock.

Frequently Asked Questions

What is the difference between a directed reassignment and a RIF?

A directed reassignment moves you to a vacant position at the same grade and pay. If you decline, the separation is an adverse action under 5 CFR Part 752, not a RIF action under 5 CFR Part 351. That costs you bump and retreat rights, competitive retention protections including veterans preference, and the 60-day advance RIF notice.

Do USDA employees who decline relocation get severance?

Generally yes, if you are not eligible for an immediate annuity. Declining a reassignment outside your commuting area is treated as involuntary separation, which qualifies. The catch: retirement-eligible employees who skip Discontinued Service Retirement forfeit severance entirely.

What does the union lawsuit actually argue?

Three things. First, USDA violated the FY2026 appropriations rider that requires congressional approval before spending funds on relocations or reorganization. Second, the reorganization is arbitrary and capricious under the Administrative Procedure Act. Third, it is a RIF in disguise: USDA's own ARRP set the reduction targets and counted on relocation refusals to reach them.

What are bump and retreat rights?

In a formal RIF, bumping lets a higher-retention employee displace a lower-retention one up to three grades below, and retreating lets you return to a position you previously held. Both exist only under 5 CFR Part 351. Because USDA is using directed reassignment authority instead, neither applies.

When do USDA employees have to decide?

Most agency decision deadlines have passed or are imminent; FSIS's was June 30. USDA proposed relocating approximately 2,600 positions, and your own letter sets your dates. For eight components a court stay now holds those dates through October 13, 2026 for challenged-plan directives other than moves within the National Capital Region, so check the docket before treating any date as final.

Sources: Government Executive, Federal News Network, Democracy Forward, 5 CFR Part 351 (eCFR), USDA FSIS FAQ