President Donald Trump’s ambitious initiative to reduce the federal workforce encountered a significant setback on Wednesday night when a US appeals court upheld a ruling to reinstate over 17,000 probationary employees.

In a 2 – 1 decision, the panel from the San Francisco-based 9th U.S. Circuit Court of Appeals concluded that the Trump administration had not proven that U.S. District Judge William Alsup’s decision was incorrect, which stated that federal agencies likely could not dismiss employees based on directives from the Office of Personnel Management.

‘Appellants have demonstrated neither that they are sufficiently likely to succeed on the merits of this appeal nor that they will suffer irreparable harm from complying with the preliminary injunction,’ according to the majority opinion, as reported by the New York Post.

Judges Barry Silverman and Ana de Alba – appointed by former Presidents Bill Clinton and Joe Biden, respectively – sided with the plaintiffs in the case. 

They claimed the labor unions representing federal workers, ‘provided evidence of various concrete injuries, and the district court carefully analyzed that evidence and determined it was sufficient.’

But Judge Bridget Bade, who was appointed by Trump, dissented.

She argued in her opinion that the unions ‘have not met their burden of showing that they have standing, and thus the government is likely to prevail on the merits because the district court did not have jurisdiction to enter the preliminary injunction.’

The conservative judge went on to claim that the lower court’s order may not actually ‘redress’ the harms the plaintiff’s have claimed.

‘Reinstating the terminated employees does not mean that they will return to the same positions and assignments, or that the agencies will provide the services that the organizational plaintiffs desire,’ Bade wrote. 

‘It is just as likely that the various agencies will reassign these employees to new positions or assign them to different tasks, or prioritize their mission and services in a manner that does not result in increased services to the organizational plaintiffs, or even lawfully terminate the employees,’ she argued.

‘Further, it is not clear that the district court has the authority to direct lawful personnel management decisions within the agencies.’ 

The decision applies to the Department of Defense, Department of Veterans Affairs, Department of Agriculture, Department of Energy, Department of the Interior and the Treasury Department.

It will remain in place as the Trump administration seeks to get the US Supreme Court to pause Alsup’s ruling.

The administration argued in court documents on Monday that a federal judge cannot force the executive branch to rehire employees, which Acting Solicitor General Sarah Harris argued would create ‘immense’ financial costs and logistical burdens.  

‘Only this Court can end the interbranch power grab,’ the administration’s appeal to the nation’s highest court read.

But as the case makes its way through the court systems, the Trump administration said the agencies were working to reinstate the fired employees – while also temporarily placing them on paid leave. 

Probationary employees typically have less than one year, and sometimes less than two years, of service in their current roles, though some are longtime federal employees.

The mass firings of probationary workers was the first step in broader efforts by Trump and top adviser Elon Musk to drastically shrink the federal workforce and slash government spending.

Most agencies have said that they fired a few hundred probationary workers, but others terminated far more. 

The Treasury Department, for instance, fired more than 7,600 people, the Department of Agriculture about 5,700, and the Department of Veterans Affairs and Interior Department about 1,700 each, according to court filings.

The mass firings sparked protests across the United States, as federal workers suddenly found themselves unemployed.

Some even detailed how they were cutting back on groceries, canceling nights out with friends, and even cutting back on ‘healthcare for my pets.’

Amid the backlash, Alsup ruled on March 13 that OPM – under which Musk’s Department of Government Efficiency operates – improperly ordered the six agencies to fire the workers even though it has no power to do so.

He called the large scale firings across government a ‘sham’ in a fiery decision, days after ruling that a government directive for the firings was ‘unlawful.’ 

But the judge also indicated that the Trump Administration could find ways the cut through the workforce through a Reduction in Force. 

Meanwhile, a judge in Baltimore, Maryland separately ordered that 25,000 probationary workers at 18 agencies be reinstated, but on different legal grounds.

That case involved a lawsuit brought by 19 Democrat-led states and Washington, D.C., who said the mass firings would trigger a spike in unemployment claims and greater demand for social services provided by states. 

Employees that would have to be reinstated under that ruling work for all of the agencies subject to Alsup’s order except for the Department of Defense – which said it had fired about 360 probationary employees.

The Trump administration has appealed that decision. A Richmond, Virginia-based appeals court recently refused to pause the ruling pending the outcome of the case.