Schwarzenegger: Minimum Wage for State Workers

(AP)  Updated at 11:06 p.m. ET

Gov. Arnold Schwarzenegger on Thursday ordered about 200,000 state workers to be paid the federal minimum wage this month because the state Legislature has not passed a budget, but the state controller is refusing to comply.

Department of Personnel Administration Director Debbie Endsley sent the order in a letter to the state controller, who refused a similar order two years ago. The matter is tied up in the appellate courts, leading the controller to say he will abide by whatever final ruling emerges, which could be years down the road. He said he can't follow the order now due to technical and legal issues.

Most state employees will be paid the federal minimum of $7.25 per hour for the July pay period.

Schwarzenegger spokesman Aaron McLear said the change should be reflected in state employees' next paycheck. Workers will be paid in full retroactively once a budget is passed.

"It's a sad day when the boss wants to make his employees collateral damage in a budget dispute," said Patty Velez, an environmental scientist and president of the California Association of Professional Scientists, a union that would be affected by the cuts.

The Republican governor has been frustrated by the Legislature's failure to close California's $19 billion budget deficit, even as the new fiscal year began Thursday.

Schwarzenegger's order does not affect the 37,000 workers, including California Highway Patrol officers, who are in unions that recently negotiated new contracts with the administration. Those contracts included pay cuts and pension reforms that will save the state money.

Asked whether the governor was sending a message to the unions that have not yet signed new contracts, McLear said no.

"We're sending a message to the controller to follow the law," he said.

Schwarzenegger made a similar order two years ago, but it never took affect because state Controller John Chiang refused to comply. The courts later sided with Schwarzenegger, but the matter is on appeal.

"It's inevitable that this is going to end up being ruled against the controller," McLear said.

Chiang, a Democrat, is an elected statewide officer. His deputy press secretary, Jacob Roper, said Thursday that the controller's office does not intend to follow Schwarzenegger's order, in part because the state's computerized payroll system cannot handle the change.

"This is uncharted waters here," Roper said. "No city, county or state has ever taken this action before."

In a statement, Chiang said it was not possible with the state's current technology to pay some employees their full salaries and others minimum wage. He also said his office and the governor's have been working on a system upgrade, but it will not be ready until October 2012.

Schwarzenegger's order, if implemented, could cost the state billions of dollars because the action would violate employment law, Roper said. He cited the federal Fair Labor Standards Act, which he says entitles a worker to "double damages" if an employer cuts pay to minimum wage.

Salaried managers who are not paid on an hourly basis would see their pay cut to $455 per week.

Some of the state's roughly 250,000 employees would be exempt, including doctors and attorneys, because minimum wage laws do not apply to those professions. Under the order, they would not get paid at all until a budget deal is struck, said Lynelle Jolley, spokeswoman for the Department of Personnel Administration.

"This all goes away if the Legislature passes a budget this month," she said.

Service Employees International Union 1000, the state's largest employee union, declined to comment because union lawyers are still reviewing the matter. The union, which represents about 95,000 state workers, joined Chiang in the legal challenge two years ago.

SEIU 1000 employees generally earn more than federal minimum wage, in part because California's state minimum wage of $8 an hour is higher.

[DecToState]

How's this for a solution.

For a budget... What if I as a state worker take a 15 percent pay cut (10 percent would be a temporary cut to end after 2 fiscal years and if the state is financially healthy by then) plus doubling what i put into for my retirement permanently. For me this would be my bitter pill to swallow. But i would gladly accept it if these two things were to occur.

1) The Vehicle Licensing Fee that DMV charges all Californians for their cars be returned to the original 2 percent (of vehicle value + depreciation for length of ownership). It should be known that over the last few years this fee had been cut by 2/3 of what it was and has been since the Warren administration.

2) Eliminate Prop 13.

It is not fair to use state workers as pawns to force a side to concede to just cuts to make a budget work. Be it as it may, i wouldnt mind getting a cut since i am grateful to even have a job. But just beacause I work for the state of california doesnt mean that only state workers will sacrifice. Everyone should take this bitter budget pill. For every cut, they should be some way to get new revenue.

Dont get me wrong... I think its just as wrong if all they did in the legislature to fix the budget is to borrow more money and raise more taxes. RAISE TAXES and CUT have to be used equally.

[IndepTex22]

by underdogus2007 July 2, 2010 6:49 AM EDT
Simple solution: RAISE TAXES!!!

Better solution........downsize government and cut social services!

[babooph]

Min wage ,if inflation adjusted in my lifetime, would be about 15$/hr-have Schwartsy live on min wage until he changes his mind& the deal would not last 5 minutes...

[underdogus2007]

Simple solution: RAISE TAXES!!!

[longtree-2009]

meanwhile arnold stops the furlough program but attemptes to implement minimum wage. at the same time, there are county governments that are in the process of raising taxes to pay for county services. cities are doing the same thing. one way or the other, taxes and fees are increasing on many who are already under financial strain. yet tax loopholes remain, state workers are protected by and large from any financial cuts. arnold is powerless as would any governor be past, present or future. even meg whitman couldn't do a thing in this situation. unions rule as do special interest groups. california residents are nothing but city, county, state government's cash cow. california is so hosed. illegals are a problem because californians, u.s. citizens, hire and harbor them from ordinary residents to businesses and only illegals are punished if caught. illegal drugs are smuggled into california because californians, and u.s. citizens, use and buy those illegal drugs. the blame is not all on the illegals but we the people too.

[hemster2]

Sinple..stop the free tuition, healthcare, and social benefits for illegals. When the hell will this basic fact get through peoples heads? This saves more than 10 billion a year alone. And people wonder why America is collapsing. We're governed by selfish, greedy bastards.

[doctajim]

What utter trash. I know over 30 state workers (though I don't and never would work for the State of CA), and NONE of them are double dipping with political relatives - not one has a relative that is in or has been in politics. Furthermore, I have two friends that have more than 20 years and they can't draw on their retirement because they aren't over 55. In virtually every field, they make less job-for-job than equally qualified people in the private sector. 12 of these I personally know are single mothers, more than half of which (8) receive no child support. They were looking for something that could offer some security for raising their kids - and what do they get, a fascist Hun for a Governor, who refuses even the most resonable negotiation with the unions and is only hitting these employees with his steroidal ego because their union has said "no" to negotiated settlements that were equal to the ones that have already been settled with other state unions. Why - because the union which has refused Der Fuhrer challenged him in court and HE wants revenge - THAT'S why he is slapping them with minimum wage - REVENGE!!!!
The Austrian Maniac has refused offers for Federal Mediation - he wants blood. Read the daily State briefs if you want to know what's really happening.
God Bless you John Chiang - the one man in Sacramento that has the guts to say "no" to a barbarian!

[doctajim]

Sorry - they were LESS than equal to the ones that have already been settled. I got furious with the lies told by the Governor's lackeys who were posting garbage!

[spaceatoms]

Minimum wage in the most expensive state, its time to become your own country.

[Shanes007]

Those of you that think prison guards, firemen and police officers make too much money and are the reason for the demise of our state:

Would you want to a job dealing with child molesters, drug dealers, gangs and have to deal with feeling through some loser?s feces to check for drugs or better yet, have it thrown in your face for minimum wage? Would you take a risk of getting stabbed or shot on a daily basis? Would you risk your life daily as the men and women in law enforcement do? I am willing to bet NOT! Do you want predators on the streets harming your family or dealing drugs to your kids?

Thankfully, I am not a state worker and you couldn't pay me enough to do these types of jobs!!! They are not all doing these jobs because they all LOVE what they do! Until you have walked in their shoes, quit blaming those that work hard to make decent salaries and get yourself an education about what they do! They are not the ones we need to blame!

[RickCain4150]

Has anybody figured out by now that the Federal Minimum wage is FAR TOO LOW.

I've never understood Americans, they criticize "lazy" state workers, then in the same breath defend multimillion dollar salaries on Wall Street.