A federal judge on March 6 ruled that President Donald Trump’s administration can fire contractors working for the U.S. Agency for International Development (USAID).
U.S. District Judge Carl Nichols said the contractors had not proved that the terminations amounted to irreparable harm, and that the court likely lacked jurisdiction to hear the case, characterizing it as a contract dispute.
The Personal Services Contractor Association (PSC) sued on Feb. 18, alleging that the Trump administration went beyond its authority to freeze the agency’s foreign aid and worldwide development funding without consulting Congress. The administration has announced plans to cancel over 90 percent of USAID’s contracts and grants.
The association said the loss of infrastructure has resulted in “havoc,” as some overseas contractors have lost utilities, health care, and are facing eviction because the U.S. government is no longer paying those bills.
Although the administration has offered a blanket waiver for USAID’s food and medicine programs, the plaintiffs allege that a lack of communication and staff has crippled the agency’s aid contracts and disbursement programs.
Carolyn Shapiro, attorney for PSC, argued at a March 5 hearing that the damage could not be remedied later by reimbursements, or by reassembling USAID in the future. She repeatedly compared it to putting “Humpty-Dumpty” back together again.
“It is not possible to take 1,000 agencies, scatter them to the wind, then say ‘oops,’” she said.
The government responded in its court brief that Secretary of State Marco Rubio, who was appointed acting administrator of USAID on Jan. 30, is within his authority to examine USAID’s funding priorities, which he said showed signs of “severe inefficiency.”
The government also said the contractors’ dispute does not belong in federal court but in the Civilian Board of Contract Appeals.
The lawsuit comes after Trump signed an executive order on his first day in office temporarily pausing foreign aid for 90 days, allowing programs to be reviewed to determine if they are aligned with U.S. interests. It also follows comments by the president suggesting that the agency should be dismantled or merged with the State Department.
Trump and congressional Republicans have said that many of the agency’s programs are wasteful and have supported causes that advance progressive political agendas.
Congressional Democrats have expressed concern that USAID may cease to act as an independent agency if Trump attaches it to the State Department. They have said that USAID is vital to national security and that Trump lacks the legal authority to eliminate a congressionally funded independent agency.
On Feb. 23, the administration placed all USAID staff on administrative leave, except for “personnel responsible for mission-critical functions, core leadership, and/or specially designated programs.”
Overseas employees of USAID have been asked to return to America, and the government has laid off around 1,600 of its U.S.-based employees.
PSC’s action is one of four lawsuits currently challenging the Trump administration over its actions to reform USAID.
Jacob Burg contributed to this report.
