IRS Terminations Raise Concerns Over Employee Performance Ratings
A recent report from the IRS’ Watchdog revealed that the agency did not factor in employee performance ratings when it terminated thousands of probation employees earlier this year.
The Treasury Inspector General for Tax Administration (TIGTA) found that nearly all 7,315 fired probation employees were rated as high performers or lacked documented performance ratings altogether. Specifically, out of about 3,600 probation employees who did receive ratings, a striking 99% were classified as “fully successful or better.” The report, released on August 14, highlighted that many of these employees were recognized for being consistent, polite, respectful, and knowledgeable in their roles.
“The conclusions indicate that individual performance was not taken into account when terminating these probation employees,” TIGTA stated.
Despite the high performance ratings, the IRS proceeded to terminate thousands of probation workers in February as part of a broader governmental directive. Termination notices, which affected even high performers, suggested that the layoffs were partially justified by performance considerations.
“Given your performance, and in light of current mission needs, it has been determined that your ongoing employment does not align with public interest,” read the standard termination notice cited in the report.
TIGTA noted that IRS officials had not immediately responded to a request for comment regarding the situation.
The IRS had initially identified over 14,000 probation employees, but many were spared from termination, particularly those in law enforcement, military families, and others deemed essential during tax season, according to TIGTA. In its findings, TIGTA also revealed that high-ranking IRS officials hesitated to sign termination notices, expressing concern over the lack of documented performance issues for many employees. However, the agency went forward with the dismissals anyway.
The report highlighted procedural missteps during the termination process, noting that the IRS largely failed to adhere to internal policies that require 30-day notices and consideration of performance in termination decisions.
In March, the affected employees were placed on paid administrative leave amid ongoing federal litigation. By May, the IRS invited some of the previously terminated employees to return, but ultimately, fewer than half (over 3,000) made their way back, as per the findings. More than 3,500 employees were involved in a delayed resignation program, with around 750 opting to resign for reinstatement.
In total, about 4,000 IRS employees applied for the initial resignation program in February, and a few months later, roughly 23,000 sought to participate in a second round. The agency accepted around 18,000 resignations, as reported in June.
The situation adds more complexity as the Supreme Court recently clarified guidelines for workforce reductions, which seem to follow the direction of the previous administration. Some agencies have since continued workforce reductions.
Concerns linger about the eligibility of those who seek to return to work amidst future workforce cuts, according to TIGTA.
Moreover, the Trump administration has shown interest in reshaping performance management standards for federal employees, suggesting that management encourages fewer top performance ratings during reviews. The Office of Personnel Management is also modifying federal probation regulations. New rules that took effect in June allow agencies greater latitude in terminating probation employees if they feel the employee doesn’t meet institutional needs.
