The D.C. Circuit Court of Appeals on Friday remanded the Consumer Financial Protection Bureau’s workforce-reduction case back to the district court that last year issued a preliminary injunction preventing mass cuts.
Beyond that, the circuit court denied a request by Justice Department lawyers to give the district court a 45-day limit to issue a ruling on the CFPB’s revised workforce plan.
The bureau in late March proposed cutting 618 jobs, or 53% of its staff, in documents sent to the circuit court.
The CFPB, at the time, said it expected it would need to reduce its workforce by the fourth quarter of this year, given budget constraints, without a revised staffing plan.
“It would be mathematically impossible to comply with the law without a workforce restructuring and reduction,” Geoffrey Gradler, the CFPB’s deputy director, wrote in March.
Hence, the request for a 45-day deadline.
The CFPB’s court opponents, the National Treasury Employees’ Union representing the bureau’s workforce, called the timeline “artificial,” in an April response sent to the court.
In a sign that the agency may have expected less pushback in court, the CFPB said last month that it would end remote work for all but a few of its employees, ordering them to be based out of the CFPB’s new headquarters, which has space for about 550 employees.
Four of the circuit court’s 11 judges on Friday said they would rather have waited “until the legal questions pending before the en banc court are resolved before remanding to the district court,” according to a document seen by Banking Dive.
From here, District Judge Amy Berman Jackson will decide whether to modify her earlier injunction and let the CFPB issue reductions in force.
Advocates of the CFPB’s pre-Trump era work counted Friday’s decision as a victory.
“Last night, the D.C. Circuit rejected the Trump Administration’s latest request to shut down the Consumer Financial Protection Bureau, refusing to lift the injunction that has prevented [the bureau’s acting director] Russ Vought from carrying out his plan to eliminate the agency,” Sen. Elizabeth Warren, D-MA, the bureau’s architect, said in a statement Saturday. “We’ll keep fighting for the agency that has returned more than $21 billion directly to Americans who were cheated or scammed by big banks and giant corporations.”
Neither the CFPB nor the DOJ issued a statement on the ruling.
Days before the decision, the NTEU, on its Bluesky page, wrote, “Make no mistake, the forced relocation of our workers is part of a plan to drive us out of public service and close the CFPB - all while pardoning corporate criminals.”
The CFPB and the NTEU told the circuit court they wanted Berman Jackson to review the March reduction plan. The plan recommends a 78% staff cut in the supervision division, which conducts exams. The enforcement division, which investigates and takes legal action against financial institutions, would see a 63% workforce cut. The legal division, however, would survive unscathed.
