1. Firing != reducing spending

2. Many of the employment and B2B contracts they're cancelling are breaching the contracts, so much of the firing is likely illegal

3. This judge didn't rule on the legality, meaning his ruling has no bearing on whether it's legal:

"However, Cooper on Thursday said, he likely lacks the power to hear the case, and the unions instead must file complaints with a federal labor board that hears disputes between unions and federal agencies."

The article states that the lawsuit was rejected merely on procedural grounds (specifically the doctrine of administrative exhaustion) . It does not come close to stating that the action was legal.

The actual court decison (which I have also read) is consistent with the article.