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| Economy |
| Schwarzenegger orders government worker furloughs |
| 2010-07-30 |
| Gov. Arnold Schwarzenegger on Wednesday brought back furloughs for thousands of state workers until California passes a budget that addresses a $19 billion deficit. Schwarzenegger released a new executive order requiring state workers to take three unpaid days off per month starting in August. State workers were furloughed a total of 46 days when Schwarzenegger issued a similar order in February 2009, which translated to a pay cut of about 14 percent. Those furloughs just ended in June. It's unclear how long the latest round of furloughs could last, as Schwarzenegger and lawmakers enter the fifth week of the new fiscal year without a balanced budget. Earlier this week, the governor hinted that he might not sign a budget before he leaves office next January unless it includes pension, tax and spending reforms. "Without a budget in place that addresses our $19 billion budget deficit, every day of delay brings California closer to a fiscal meltdown," Schwarzenegger said in a statement. "Our cash situation leaves me no choice but to once again furlough state workers until the Legislature produces a budget I can sign." State Controller John Chiang has warned he will start issuing IOUs in August or September if the budget stalemate drags on in the Legislature. Chiang said the cash-saving measure is necessary because the state is projected to run out of cash in October. The new order exempts employees who work for departments that collect revenue, such as the Franchise Tax Board, and public safety agencies, including the California Highway Patrol. It also exempts about 37,000 workers in six unions that recently reached tentative labor agreements with the administration. Those unions agreed for their members to contribute more of their salaries toward their pension benefits and to take one day of unpaid personal leave a month, the equivalent of a nearly 5 percent pay cut. The state has about 237,000 workers. The furlough puts pressure on remaining unions that have not agreed to the governor's demands for pension changes. Schwarzenegger's last furlough order triggered more than two dozen lawsuits, but the administration said the furloughs achieved about $1 billion in general fund savings and $2.2 billion in overall savings during the state's last budget crisis. Unions also have been fighting the governor's efforts to impose the federal minimum wage $7.25 per hour while the state operates without a budget. "To once again force state employees to take unpaid furloughs is just another punitive measure by Gov. Schwarzenegger because he couldn't impose minimum wage," said Patty Velez, president of the California Association of Professional Scientists, which represents 3,000 state employees. |
| Posted by:Fred |