Layoffs of more than 9,000 Interior Ministry employees will begin within 30 days, despite Parliament's rejection of the planned cuts.
Interior Minister Traian Igas said Thursday the ministry, which has 160,000 employees, must adjust spending to fit its 2011 budget.
Igas says Parliament's rejection of a law to slash the jobs is creating difficulties in financing current salaries. As a result, he says all employees will receive 550 lei (euro135) less in June. Union leaders have threatened protests.
In 2009, Romania took a two-year euro20 billion ($28 billion) loan from the IMF, the EU and the World Bank, as its economy shrank by 7.1 percent. Romania imposed harsh austerity measures under the agreement.