IRS CEO’s call to end advanced leave should be ‘null and void,’ NTEU says in lawsuit 

The National Treasury Employees Union is asking a federal judge to block a recent IRS decision prohibiting its employees from taking annual leave or sick leave time they haven’t accrued yet. 

NTEU, in a lawsuit filed Thursday with the U.S. District Court for the District of Columbia, argued that the IRS workforce policy change should be declared “null and void” because it was made by Frank Bisignano, who is leading the agency as its “chief executive officer,” a new title created under the Trump administration. 

Bisignano is also the Senate-confirmed commissioner of the Social Security Administration, which rolled out the same prohibition on advanced leave in a nearly identically worded memo. 

NTEU wrote that, to its knowledge, “no other agencies besides IRS and SSA have issued directives categorically barring their employees from using advanced annual or sick leave.” 

The union, in its complaint, said Bisignano's de facto leadership of the IRS violates the Appointments Clause of the Constitution. The Supreme Court has interpreted this clause as requiring “principal” officers to be appointed by the president and confirmed by the Senate. 

NTEU wrote that Bisignano “is carrying out the functions of the IRS Commissioner, which is a principal officer, but the President did not nominate him to that position and the Senate did not confirm him to it.” 

“Mr. Bisignano has therefore lacked authority for his official actions, including issuing the Directive,” the union told the court. 

Bisignano has mused aloud about how unusual it is to be running both the IRS and SSA. 

“I don't know that there'll be another person who oversees both of them,” he said at the Government Service Delivery Summit in June. “I also think overseeing both of them is much like running a large company.” 

The IRS currently lacks a permanent or acting IRS commissioner or deputy commissioner. 

The Senate confirmed former Republican congressman Billy Long in June 2025 to serve as the agency’s permanent leader, but he left after less than two months on the job. Long now serves as the U.S. ambassador to Iceland. 

Treasury Secretary Scott Bessent took over as acting IRS commissioner in August 2025, but officially stepped back from that acting role after his 210-day acting term under the Federal Vacancies Reform Act expired in March 2026. Bessent appointed Bisignano as the IRS CEO last October. 

The IRS released a statement in March 2026 stating that Bessent “retains the authority and responsibility to perform the functions and duties of vacant Treasury offices that are not filled on an acting basis, and that Bisignano is “successfully leading day-to-day operations and reporting directly to the Secretary.” 

“If this type of circumvention of the Appointments Clause is allowed to stand, there could be an executive branch full of CEOs at the helm of each agency, instead of a Secretary or Commissioner — none of whom would go through the Constitution’s process of presidential nominations and Senate confirmations,” NTEU wrote. “That would plainly conflict with what the Framers intended through the Appointments Clause.” 

The union also argued that the agency’s new prohibition on advanced leave and advanced sick leave is “arbitrary and capricious” under the Administrative Procedure Act, “because it requires across-the-board denials of all pending advanced leave requests and because it cuts off any future such requests, regardless of an employee’s individual circumstances.” 

An IRS spokesperson declined to comment on pending legislation, but said in a statement that the agency’s advanced leave restriction “aligns with the agency’s efforts to build a high-performing, highly engaged workforce operating as One IRS to deliver a world-class customer experience and aligns to our commitment to be responsible stewards of taxpayer dollars.” 

“The IRS continues to offer a comprehensive and competitive benefits and leave program that promotes employee well-being, flexibility, and long-term financial security,” the spokesperson said. 

The IRS’ Internal Revenue Manual (IRM) instructs supervisors to review each request for advanced annual and sick leave on a case-by-case basis. Guidance from the Office of Personnel Management states advanced sick leave is a “flexibility” agencies can use to help new employees who haven’t accrued much leave yet, as well as more tenured employees experiencing personal hardships. 

OPM directs agency supervisors to “use their judgment in reviewing a request for advanced sick leave” and minimize the chances of employees separating from service with a negative leave balance. 

Federal employees replenish their annual and sick leave over time. Federal employees who leave government service with a negative leave balance must refund the cost of that advanced leave, and agencies may deduct it from their final paycheck.

NTEU wrote that the IRS’ new policy “is harming numerous IRS employees” who had advanced leave requests pending.  

“The agency has now summarily denied all of those requests pursuant to the Directive,” the union wrote.