An 18-month workforce restructuring effort affecting 15 percent of employees of the Internal Revenue Service's Modernization and Information Technology Services (MITS) should be complete by September.

"We're putting this organization through more changes than any other organization I've ever seen in the federal government," said W. Todd Grams, IRS chief information officer (right). About 1,000 of the 7,000 IT workers at the agency are being affected by the ongoing restructuring. That includes a competitive sourcing study that recommends eliminating more than 200 positions — not because the IRS lost its bid to a faster, cheaper private-sector company but because it won the competition by reducing its overhead.

The IRS will save about $110 million due to the restructuring, which is a significant amount considering that the agency has absorbed $200 million worth of new costs from pay rises, inflation and the costs of modernization due to a flat IT budget for the past four years, Grams said. The Business Systems Modernization budget can only be used to pay contractors, not to cover IRS employees' salaries, he said.

The two areas being restructured are End User Equipment and Services (EUES); the seat management organization for the agency's 100,000 nationwide employees; and mainframe computer operations in Michigan, West Virginia and Tennessee.

Some jobs will be eliminated, "some jobs we need to be paying people more money and be asking them to take on more responsibility, other jobs we're paying people too much," Grams said.

About 100 employees will receive reduction in force (RIF) notices in September as a result of the restructuring, Grams said. Early outs, job swaps, transfers and priority reassignments have cut down the number of RIFs that might have been necessary otherwise, Grams said. "We're very proud of the progress we've made in reducing the impact that this will have on our employees," he said.

But employees are unnerved by the reorganization, said Colleen Kelley, president of the National Treasury Employees Union. "There's a lot of disruption and the IRS doesn't really focus on that," she said. Workers want to return to the days when they could come to work without wondering whether their jobs have changed, she said.

The union won't take job losses as a result of the reorganization lightly, she said. Particularly within EUES, employees will likely begin a dispute process in September if they're being dismissed because the IRS says they lack skills to work in the reorganized function, Kelley said. A small amount of training would close any skills gaps, but the IRS doesn't appear interested in initiating that, she added.

And for seat management employees, restructuring will likely continue past September; EUES is the next function slated for a competitive sourcing study. "That's the only competitive sourcing area that we're doing right now," Grams said. "To say 'only' is like saying you 'only' want to go to Mars — why not Jupiter and Saturn?"