The Health Department will turn to voluntary redundancies as it axes jobs in a process unions warn could see 250 positions gone.
In an email to staff, department secretary Martin Bowles said it would seek expressions of interest for voluntary redundancies as it seeks "a staffing profile that is affordable".
CPSU deputy secretary Beth Vincent-Pietsch said the redundancies would shed five per cent of the agency's workforce.
"We have serious concerns about the potential impact of losing that capacity and experience on the agency's essential work," she said.
"We have begun talks with the department and will continue to closely monitor what impact this reduction in staffing will have on the services provided by Health, and ensuring affected workers are properly supported.
"It is at least encouraging that the department appears committed to a transparent process of voluntary redundancies.
"Australians can't afford for the critical public role played by Health to be at risk or service standards to erode as they have in other agencies like Centrelink, Medicare and Child Support, the Tax Office."
Mr Bowles' announcement comes after he flagged budget and staffing issues would be the department's largest challenges in 2017.
He told staff the redundancy program occurred as part of the federal government's drive to find budget savings.