Schwarzenegger Orders Pay Cuts, Hiring Freeze To Preserve State Cash
On Thursday, Gov. Arnold Schwarzenegger (R) signed an executive order reducing pay for state workers and laying off more than 10,000 temporary and seasonal workers, with exceptions for health care, law enforcement and public safety workers, the Los Angeles Times reports.
Workers whose pay is cut would receive their lost wages once a state budget is approved.
Michael Genest, the governor's finance director, said the cuts are needed to ensure that the state has sufficient cash reserves to run through September (Rothfeld, Los Angeles Times, 8/1).
The pay cuts would not take effect until September at the earliest.
However, Controller John Chiang (D) has pledged to continue to pay state workers their full salaries, setting the stage for the governor to bring a lawsuit to force Chiang to comply with the executive order.
The governor gave department heads until today to finalize a list of employees who would be exempt from the pay cuts and layoffs.
Schwarzenegger said he expects to sign a final budget agreement in the next few days (Zapler, San Jose Mercury News, 8/1).
However, Assembly Speaker Karen Bass (D-Los Angeles) said she believes that a budget would be in place by the end of August (Los Angeles Times, 8/1).