IRS Cancels 500 Layoffs

THE DAILY FED

IRS Cancels 500 Layoffs

The IRS announced Tuesday that it will spare some 500 jobs from proposed layoffs, because it needs the extra staff to make good on taxpayer service improvements promised by President Clinton.

Tuesday's announcement concludes an intense 18-month fight between the IRS and the National Treasury Employees Union over a plan that initially involved a cut of 5,000 jobs. But after intense lobbying and legal action by NTEU, the IRS dropped its plan for widespread reductions in force and instead relied on buyouts, early retirements and other personnel moves to trim the agency's staff.

In the past five years, IRS employment has dropped from 116,000 to 102,000 and the agency has closed 30 district offices.

The IRS had proposed the 5,000 additional staff cuts in response to demands by members of Congress that the agency trim its workforce and become less intrusive in the lives of taxpayers. But after recent Senate Finance Committee hearings into alleged IRS mismanagement, President Clinton announced plans to simplify tax forms and expand IRS telephone service to 24 hours a day by 1999.

"We recognized with the additional commitments for customer service and implementation of tax law changes, we are going to need additional staff years to accomplish all of that," IRS chief of management and administration David Mader told the Associated Press.

Instead of cutting the 500 jobs, the IRS will transfer staffers to the agency's problem resolution office or to customer service or service-center tax adjustment positions, Mader said.