The International Labour Organisation (ILO), led by Director-General Gilbert F. Houngbo, is seeking approval for a major reduction in its workforce as it confronts a severe liquidity crisis, with the organisation warning that it needs to save $22 million (€18.9 million). Houngbo has proposed eliminating 120 jobs, including 73 permanent posts, from an organisation currently employing 1,670 people. The measures are intended to ease mounting pressure on the ILO’s cash position, with the organisation facing substantial unpaid contributions from member states.
The financial strain is closely linked to the United States, which owes the ILO about €280 million in unpaid contributions. The US arrears account for 70% of all outstanding contributions owed by states that have failed to make their payments. The proposed workforce reduction therefore comes as the organisation attempts to manage its finances amid a significant shortfall in expected funding.
Because 61% of the jobs targeted for elimination are permanent positions under the ILO’s classification, Houngbo has asked the organisation’s Governing Body to approve the restructuring, in accordance with the ILO’s statutes. The proposal will be the first item on the agenda of an extraordinary meeting of the Governing Body in Geneva on 7 September. The request was formally registered on 17 August, and the 56-member body will have to decide whether to authorise the elimination of the structural posts.
The proposed savings would amount to €22 million, described in the report as equivalent to reducing approximately 120 full-time positions. The plan would also maintain a recruitment freeze until December 2027. Houngbo is seeking approval to abolish 73 permanent positions, alongside roughly another 50 jobs that are not classified as structural and for which the Director-General does not require explicit authorisation to proceed with dismissals.
The proposal, however, has triggered a dispute over the legal authority to make such a decision. The ILO Staff Union argues that the Governing Body does not have the legal competence by itself to reduce the number of permanent positions. Staff representatives maintain that such a substantial measure would require an explicit delegation of authority to the Governing Body, which consists of 28 representatives of member states, 14 representatives of workers’ organisations and 14 representatives of employers.
According to the staff representatives, such authority could only be granted by the International Labour Conference, the ILO’s supreme governing body, where all members of the organisation are represented. Their argument rests on the requirement that a permanent official, whose appointment has no fixed end date, cannot have their contract terminated unless the number of approved posts has first been reduced by the organisation’s governing bodies.
Houngbo’s office nevertheless argues that the Governing Body has the authority to reduce the number of posts as part of contingency measures for the 2026-2027 biennium. Its report acknowledges that a decision by the International Labour Conference would provide the strongest institutional basis, but maintains that the Governing Body can act within the existing contingency framework. If the posts are formally reduced, the Director-General would then proceed with the resulting dismissals.
The restructuring also comes at a politically sensitive moment for Houngbo, who is due to seek re-election in November against Spain’s Second Deputy Prime Minister and Labour Minister Yolanda Díaz. At the same time, his team has maintained an offer for a figure linked to Donald Trump’s government to occupy the ILO’s principal executive position, on the condition that the United States brings its outstanding contributions up to date.
The proposed cuts therefore point to an organisation preparing for a more constrained financial future. The Houngbo administration has indicated that its plans envisage operating with a smaller budget if the United States continues not to provide the financing it owes, placing the ILO’s staffing structure at the centre of an increasingly consequential financial and institutional dispute.
