Federal agencies submit Phase 2 workforce reduction plans to OPM by April 14 deadline

The Office of Personnel Management issued guidance on February 26, 2025, directing federal agencies to submit Phase 1 restructuring plans by March 13, 2026, and Phase 2 Agency Restructuring and Reorganization Plans (ARRPs) by April 14, 2026. The Phase 2 deadline was critical because it required agencies to detail not just which positions would be eliminated, but how they would reorganize to maintain mission delivery. OPM and OMB specified that Phase 2 plans must outline a "positive vision for more productive, efficient agency operations going forward." The plans had to include details on competitive areas affected, specific position eliminations broken down by type (full-time equivalents, temporary positions, reemployed annuitants), real estate consolidations, and timeline for implementation by September 30, 2026.

The Department of the Navy launched the most sweeping workforce review in the executive branch. On February 17, 2026, Navy Secretary JPJohn Phelan directed every command from Echelon 1 through Echelon 4 to prepare workforce impact statements modeling three reduction scenarios: 10 percent, 15 percent, and 20 percent civilian cuts. This affected approximately 340,000 Navy civilian positions across all commands. BKBenjamin Kohlmann, Assistant Secretary of the Navy for Manpower and Reserve Affairs, led the review. The Navy conducted scenario analysis rather than issuing immediate RIF notices, aiming to complete the organizational review by September 30, 2026. Initial status reports were due in March 2026, with formal decisions planned before end of fiscal year 2026.

Federal workforce reductions began accelerating in 2025 before the April 2026 Phase 2 deadline. Between January and November 2025, the federal government recorded 335,200 total separations (resignations, retirements, RIFs, and voluntary departures) against only 118,000 new hires, resulting in a net loss of 217,200 positions. Reductions in Force (RIFs) jumped from 46 in all of fiscal 2024 to 10,700 in calendar 2025 — a 233-fold increase. HHS and USAID accounted for over 8,000 RIFs alone. The Department of Education lost nearly 80 percent of its workforce; USAID was effectively dismantled. By March 2026, cumulative federal departures exceeded 352,000 employees, driven by hiring freezes, early retirement incentives (VERA), voluntary separation incentive payments (VSIP), the deferred resignation program, and involuntary RIFs.

The RIF process is governed by federal law and union contracts and cannot be executed arbitrarily. Title 5, Code of Federal Regulations, Part 351 establishes six phases of RIF implementation. Phase 2 includes defining competitive areas (organizational units and geographic locations), reviewing position descriptions for accuracy, validating competitive levels, and verifying employee retention data (veterans' preference, service computation dates). Phase 3 requires issuing formal RIF notices with minimum 60 days' notice (or 30 days with OPM waiver). Affected employees have appeal rights, access to career transition assistance programs (RPL, CTAP, ICTAP), and federal/state reemployment resources. OPM can grant waivers to expedite timelines through parallel processing, but agencies cannot bypass notice or appeal rights.

By March 2026, approximately 25,000 federal workers who had been separated through earlier DOGE-era RIFs had been rehired as "essential" to agency operations, according to Brookings Institution analysis. Courts ordered reinstatements at 18 agencies covering more than 24,000 workers. The Treasury Department (including IRS) rehired 7,000+ workers after court orders from federal judges in 🦀Maryland. USDA, Commerce, EPA, and Department of Transportation all experienced court-ordered reinstatements. The National Weather Service, which lost about 600 meteorologists and hydrologists in early 2025, received approval to fill 450 replacement positions by August 2025. These reinstatements suggest that initial RIF decisions cut more deeply than agencies could sustain operationally.

The Phase 2 deadline created a cascading impact on federal operations. Agencies had to decide which specific positions would be eliminated, which functions would be consolidated, and where offices would relocate from expensive locations like 🏛️Washington, D.C. to less-costly regions as mandated by OPM guidance. The Army began active reassignment notifications at TACOM in March 2026, giving employees 2 to 5 days to decide whether to accept new positions or face RIF. The Navy held scenario modeling but avoided immediate notices, adopting a more deliberative approach. This variation in implementation timelines and methods created uncertainty for 2.1 million federal civilian employees awaiting clarity on their job security.