NTEU Wins Two Arbitration Cases Against the IRS: What the Law Says About Enforcing Final Awards

The IRS has lost two more arbitration cases to its own employees, and the union that won them is already warning that the agency may not comply. The cases were reported by Drew Friedman of Federal News Network on November 2, 2026.

The Two Arbitration Wins

According to that reporting, the first case involved employees on an alternative work schedule who were banking credit hours. The IRS cut that off, and the arbitrator said doing so violated the contract.

The second case involved employees who tried to take back their resignations while the IRS was cutting jobs. The arbitrator ordered the IRS to let them come back, which means they would be reinstated.

Why NTEU Is Warning About Compliance

NTEU has already been in a dispute over a separate telework award that the IRS lost. NTEU says the IRS told its managers that return-to-office would stay in place and that the contract no longer applied, and the union sued over that. NTEU now says the agency may take the same approach with these two decisions, either by appealing or by simply not acting.

These Decisions Are Not Final Yet

The IRS can still file exceptions with the Federal Labor Relations Authority (FLRA). That means these awards are not yet final, and the agency's obligations are still open.

What 5 U.S.C. § 7122(b) Says

Once an arbitration award becomes final, the statute is direct. Under 5 U.S.C. § 7122(b), "an agency shall take the actions required by an arbitrator's final award." The word is "shall," not "may." Whether and how an award is enforced depends on the contract and the facts of each case, and this is general information rather than advice about any one situation.

What You Can Do

If either of these decisions describes your situation, let your NTEU steward know right away. The union is pushing for enforcement, and the steward can tell you where your case stands. Keep copies of any award, notice, or email from your agency about it, and send this to a coworker who may be affected. 

Legal Disclaimer: This content is for general informational purposes only and does not constitute legal advice. Federal employment situations are fact-specific and time-sensitive. Please consult a qualified federal employment attorney about your specific situation. You can contact Southworth PC at attorneysforfederalemployees.com.