Siptu is demanding a pay-off for 105 workers in return for giving up the generous leave entitlements they negotiated back in the 1980s.
The employment agency gave workers up to 44 extra days off in their last two years before retirement to help them "acclimatise" to life without work.
These days were on top of their normal entitlement of 26 days holidays a year -- already six more than the average private sector worker.
A new board of FAS, which was put in place last year, found there was no comparable retirement scheme in the public sector and immediately ended the arrangement.
But Siptu said the action was taken "unilaterally and without consultation", and complained to the Labour Relations Commission.
As controversy grows surrounding the holidays a hearing is expected in the Labour Court soon. Government sources have called for a change of attitude from FAS, now to be called Solas, while one backbencher urged the country's biggest union to "wake up" to the new economic reality.
The Government was unable to comment on the issue because it is before the Labour Court.
But one source said: "If the Croke Park Agreement is to be successful, if savings and efficiencies are to be achieved, there needs to be a mindset change."
The Labour Court ordered that the leave arrangement be reinstated until a review was carried out of other entitlements across the public sector and agreement reached between the union and management.
Of the 105 staff members entitled to the extra days, 57 are due to retire in the next six months.
Fas is understood to have made two separate offers to staff, including a "buyout" of three extra days holidays over three years, but this was rejected by the union.