Federal judge rules Trump DHS plan for 50% FEMA staffing cuts was unlawful
National Legal News
A federal judge has ruled that a plan by the Trump administration to slash staffing at the federal agency tasked with responding to disasters by 50% was unlawful.
The opinion issued late Friday marked a victory for labor groups who had sued the agency. The labor organization had argued that plans by the Department of Homeland Security, which was then led by Secretary Kristi Noem, violated congressional protections that were designed to safeguard the independence of the Federal Emergency Management Agency.
The issue of the FEMA staffing was part of a much larger lawsuit filed by the American Federation of Government Employees and other labor groups, pushing back on efforts by the Trump administration to slash the federal workforce.
U.S. District Judge Susan Illston wrote in her opinion that top Homeland Security officials late last year directed FEMA's leadership to submit a staffing plan that included a 50% staffing cut even though the agency's own supervisors objected.
"Frankly, the FEMA staffing plan number appears as if pulled from thin air," wrote Illston.
FEMA responded in a statement late Saturday that while it does not comment on personnel matters and ongoing litigation, "DHS and FEMA are ready for the 2026 hurricane season."
"We're ensuring workforce stability and a strong, deployable force for upcoming national events and potential disasters; making the agency leaner, faster and laser-focused on supporting state, local, tribal and territorial partners before, during and after disasters," it said. "FEMA continues to maintain a roster of experienced leadership and support staff across headquarters and regional offices."
The Department of Homeland Security did not immediately respond to requests for comment.
In the opinion, Illston wrote that it was clear that the government violated rules established after 2005's Hurricane Katrina that put decisions on staffing levels squarely in the hands of FEMA, not the Department of Homeland Security and that prevented DHS from "substantially" reducing the "functions" of FEMA.
Illston didn't order a specific remedy to carry out her opinion but directed the two sides to meet and decide on a course of relief.
Although FEMA has experienced terminations, the 50% staffing cuts ultimately were not carried out. In recent months, after top leadership changes at FEMA and the Department of Homeland Security, the agency has rehired some staffers who were let go.
FEMA was one of the agencies targeted in the federal government for staff reductions as part of a broad Trump administration plan to reduce the size of government. The embattled agency has been buffeted by mass staff departures, disruptions of grant programs, and delays of disaster aid.
In May, a Trump-appointed FEMA Review Council submitted a final report recommending sweeping changes to how the agency supports states, tribes and territories in disaster.
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Workers’ Compensation Subrogation of Administrative Fees and Costs
When a worker covered by workers’ compensation makes a claim against a third party, the workers’ compensation insurance retains the right to subrogate against any recovery from that third party for all benefits paid to or on behalf of a claimant injured at work. When subrogating for more than basic medical and indemnity benefits, the Texas workers’ compensation subrogation statute provides that “the net amount recovered by a claimant in a third‑party action shall be used to reimburse the carrier for benefits, including medical benefits that have been paid for the compensable injury.” TX Labor Code § 417.002.
In fact, all 50 states provide for similar subrogation. However, none of them precisely outlines which payments or costs paid by a compensation carrier constitute “compensation” and can be recovered. The result is industry-wide confusion and an ongoing debate and argument with claimants’ attorneys over what can and can’t be included in a carrier’s lien for recovery purposes.
In addition to medical expenses, death benefits, funeral costs and/or indemnity benefits for lost wages and loss of earning capacity resulting from a compensable injury, workers’ compensation insurance carriers also expend considerable dollars for case management costs, medical bill audit fees, rehabilitation benefits, nurse case worker fees, and other similar fees. They also incur other expenses in conjunction with the handling and adjusting of workers’ compensation claims. Workers’ compensation carriers typically assert, of course, that, they are entitled to reimbursement for such expenditures when it recovers its workers’ compensation lien. Injured workers and their attorneys disagree.
