San Francisco, October 15, 2025 – In a sharp rebuke to the Trump administration's aggressive budget tactics, U.S. District Judge Susan Yvonne Illston issued a temporary restraining order Wednesday, blocking President Donald Trump's plan to execute mass layoffs of federal workers during the ongoing government shutdown. The ruling, delivered from the bench in a packed San Francisco courtroom, underscored the judiciary's role as a check on executive overreach, declaring the administration's actions "contrary to the laws" and a blatant exploitation of the funding impasse to advance partisan goals.
"The activities that are being undertaken here are contrary to the laws," Illston told Justice Department attorneys during the hearing, her voice steady but laced with frustration. "You can’t do this in a nation of laws." The judge, a Clinton appointee with a reputation for scrutinizing federal employment disputes, went further, accusing the administration of seizing the shutdown as a "lapse in government spending and functioning to assume that all bets are off, the laws don’t apply to them anymore, and they can impose the structures that they like on the government situation that they don’t like."
Illston's decision came swiftly after oral arguments in a lawsuit filed last month by two powerhouse labor unions: the American Federation of Government Employees (AFGE) and the American Federation of State, County, and Municipal Employees (AFSCME). Representing over 800,000 federal workers, the unions argued that the administration's reductions in force (RIFs) – euphemistically termed "layoffs" – violated the Antideficiency Act and longstanding federal personnel regulations. These laws, they contended, prohibit non-essential personnel actions like mass firings during a funding lapse, when agencies are already strained by furloughs and unpaid labor.
The lawsuit, initially targeting the Office of Management and Budget (OMB) and the Office of Personnel Management (OPM), expanded to include more than 30 federal agencies implicated in the layoffs. It was amended after the administration began issuing RIF notices on October 10, just days into the shutdown that commenced on October 1. By Tuesday, unions reported that over 4,100 notices had been dispatched across departments including Commerce, Education, Energy, Health and Human Services (HHS), Housing and Urban Development (HUD), Homeland Security (DHS), and Treasury. An additional nearly 200 staffers at the Department of Energy received general warnings of impending cuts.
In court, Assistant U.S. Attorney Elizabeth Hedges, representing the administration, repeatedly demurred on the merits of the case, insisting the district court lacked jurisdiction over employment decisions best handled by the Merit Systems Protection Board. "We're not prepared to address the legality at this stage," Hedges said, prompting Illston's pointed retort: "The hatchet is falling on the heads of employees all across the nation, and you’re not even prepared to address whether that’s legal?" The judge cited public statements from Trump, Vice President JD Vance, and OMB Director Russell Vought as evidence of political motivation, including Trump's vow to target "Democrat programs" and Vought's radio interview boast of slashing "north of 10,000" jobs.
Illston's order, formalized in writing later Wednesday, prohibits any further RIF notices or enforcement of existing ones for union-represented employees. It mandates the administration to submit by Friday an accounting of all "actual or imminent" layoffs and a declaration of compliance. A follow-up hearing on October 28 will consider extending the block into a preliminary injunction. Legal experts predict a swift appeal to the Ninth Circuit, potentially escalating to the Supreme Court, which earlier this year overturned a related Illston ruling on pre-shutdown RIFs.
The ruling arrives as the shutdown enters its 15th day, the longest since the record 35-day impasse of December 2018 to January 2019 under Trump's first term – also triggered by his demands for border wall funding. That earlier crisis furloughed 800,000 workers and cost the economy $11 billion, per Congressional Budget Office estimates, with lingering effects like delayed IRS refunds and disrupted scientific research. Today's standoff echoes those dynamics but with a sharper edge: Trump's reelection has emboldened his administration to weaponize the shutdown not just for fiscal leverage, but for structural downsizing aligned with the conservative Project 2025 blueprint.
At its core, the dispute pits Republican calls for a "clean" continuing resolution (CR) – maintaining current funding levels through late November – against Democratic insistence on protecting health care access. Republicans, controlling both congressional chambers, passed the CR in the House last month, but it has stalled in the Senate seven times, lacking the 60 votes needed to overcome filibusters. Democrats, led by Senate Minority Leader Chuck Schumer, demand an extension of Affordable Care Act (ACA) premium subsidies set to expire December 31, alongside reversals of Medicaid cuts embedded in Trump's sweeping spending bill passed earlier this year. These subsidies, enhanced during the COVID-19 pandemic, cap monthly premiums at 8.5% of household income for millions, averting average increases of $700 annually if they lapse.
House Speaker Mike Johnson dismissed negotiations Monday, predicting the shutdown could rival historical records unless Democrats relent. "We’re barreling toward one of the longest shutdowns in American history," Johnson warned, blaming Schumer for the "Schumer Shutdown" and its "real pain for real people – veterans, the elderly." Trump amplified this rhetoric Tuesday, telling reporters the impasse offers a chance to shutter "Democrat programs that we want to close up or we never wanted to happen," promising a Friday list of targets. Democrats fired back: House Minority Leader Hakeem Jeffries urged Republicans to "get back to Washington and do your job," while California Gov. Gavin Newsom accused Trump of telling Americans to "go f*ck yourself" by prioritizing cuts over subsidies that shield 40 million from health care hikes.
Public opinion tilts against the administration. A Washington Post poll from October 1 showed 47% blaming Republicans for the shutdown, versus 34% for Democrats, with 71% deeming health subsidies "worth" the fight – a reversal from 2018, when Trump bore more direct blame for wall demands. Yet, the human toll mounts daily. Approximately 1.4 million federal employees remain unpaid – 692,000 furloughed, the rest "excepted" but working without checks – accruing $400 million in daily back-pay costs, per the CBO. National parks like Yosemite and the Grand Canyon have shuttered, echoing 2018-19 vandalism spikes; Smithsonian museums and the National Zoo are dark; and IRS processing halts, delaying refunds for millions.
Federal workers, already battered by Trump's first-term cuts – which eliminated 10,000 positions via buyouts and attrition – face acute hardship. "We're not pawns in this political game," said AFGE President Everett Kelley, whose members include TSA screeners calling out en masse, causing airport delays. AFSCME's Lee Saunders hailed Illston's order as affirming "these threatened mass firings are likely illegal," but warned of broader erosion: furloughed HR staff can't guide laid-off colleagues, and IT blackouts delay notice delivery.
Economically, the CBO projects $3 billion in lost GDP by week's end, mirroring 2018's irrecoverable $3 billion hit, with ripple effects on private hiring – 120,000 jobs lost post-2013 shutdown. Vulnerable programs suffer most: SNAP benefits teeter on a $3 billion contingency fund, risking aid for 38 million; HHS special education grants stall, stranding students; and HUD after-school initiatives vanish, hitting low-income families. Immigration enforcement persists – ICE and CBP are funded – but asylum processing grinds to a halt, echoing 2018 backlogs.
This shutdown's roots trace to late September, when OMB's memo directed agencies to prep RIFs, exempting them from shutdown norms under OPM guidance. Trump's demands evolved from border security in 2018 to health care sabotage now, but the playbook is familiar: leverage crisis for concessions, damn the costs. Democrats, buoyed by midterms gains on health care, refuse to blink, viewing subsidies as a firewall against GOP austerity.
As negotiations stall – no White House-Capitol Hill talks since October 1 – pressure builds from moderates. Republican Sens. Susan Collins and Lindsey Graham floated compromises last week, blending CR extensions with partial subsidy aid, but Trump rebuffed them, prioritizing "policy opportunities to downsize." Vought, on "The Charlie Kirk Show," defended the strategy: "If there are policy opportunities... we want to use those opportunities."
Illston's intervention buys time, but resolution hinges on Congress. With midterms looming, Democrats gamble on voter backlash – polls show their hand strengthening – while Republicans bet on portraying the fight as Schumer's folly. For federal families scraping by on credit cards and food banks, the debate feels academic. One furloughed HHS clerk, speaking anonymously, captured the sentiment: "We're the ones paying for their games – literally."
The order's scope – halting RIFs at union shops across agencies – spares thousands immediate peril, but non-union workers remain exposed. Unions vow to broaden the suit, arguing the shutdown nullifies program authorizations, rendering firings void. Legal scholars like Danielle Leonard of Altshuler Berzon, representing plaintiffs, call it "an unlawful abuse of power... using employees as pawns."
Historically, shutdowns – 20 since 1976, 10 with furloughs – rarely exceed weeks, but Trump's era defies norms: three in his first term, including the 35-day marathon. The 1995-96 Clinton-era 21-day closure over spending cuts cost billions; Obama's 2013 ACA standoff idled half the workforce. Yet none weaponized layoffs like now, where OMB's directive flouts precedents barring non-essential acts.
Broader implications loom: prolonged closure risks exhausting SNAP funds by March, per 2018 parallels; aviation safety erodes with TSA absences; and scientific grants – NASA's, NIH's – atrophy, forfeiting years of progress. Delta Airlines delayed A220 launches last time; similar snarls hit today. Tourism bleeds: Alcatraz and Independence Hall close, mirroring 2018 looting.
Politically, the ruling emboldens Democrats, who frame it as judicial vindication against Trump's "extreme" agenda. Republicans decry it as activist overreach; Gingrich, on Fox, likened it to "Operation Arctic Frost" targeting GOP phones – a baseless claim. Trump, undeterred, teased Friday's cuts list, signaling escalation.
For now, Illston's gavel offers respite, affirming rule of law amid chaos. But with no end in sight, the shutdown's shadow lengthens, testing America's resilience and resolve. As one veteran – furloughed from VA benefits processing – put it: "Laws protect us, but politics starves us." The nation watches, wallets empty, for Washington's next move.
