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Calif. High Court Upholds Schwarzenegger Furloughs

The California Supreme Court on Monday upheld Gov. Arnold Schwarzenegger's order to furlough state workers, providing a a major victory for part of the governor's budgeting plans.

In its unanimous ruling, the court concluded the state Legislature's 2009 budget bill "validated the governor's furlough program."

State employee unions have been challenging Schwarzenegger's order since he implemented two-day-a-month furloughs for more than 200,000 state workers in February 2009. He later expanded it to three days a month, which has translated to a pay cut of roughly 14 percent for government employees.


Schwarzenegger said the move was intended to save money as California faced a severe budget crisis, but his order prompted the filing of more than two dozen lawsuits.

The administration estimates furloughs saved the state's general fund $1.5 billion during the previous two fiscal years and an additional $80 million a month in the fiscal year that began July 1, said H.D. Palmer, spokesman for the governor's Department of Finance.

During a hearing in San Francisco last month, the governor's legal team said the administration was acting within its rights to deal with a budget crisis. Labor attorneys claim the order violates collective-bargaining law.

The high court said the governor or his Department of Personnel Administration cannot, on his own accord, cut the pay of covered workers. But it said the Legislature can grant the governor such authority, which occurred in this case.

It said language approved by the Legislature during an emergency session in February 2009 to revise that year's budget gave the governor, at least temporarily, the authority to do cut pay as a way to deal with a state budget crisis. Schwarzenegger had begun implementing the furloughs shortly before lawmakers passed a revised budget.


Lawmakers authorized furloughs as part of that budget bill, which was intended to close a $42 billion deficit through June 2010. They also passed a massive tax increase and made billions of dollars in spending cuts.

The budget legislation passed in 2009 authorized the furloughs through either collective bargaining or "existing administration authority." The state Supreme Court said those three words gave the governor his authority.

"By enacting this provision, the Legislature, through the exercise of its own legislative prerogative, authorized the substantial reduction in the appropriations for employee compensation, mandated in the revised budget legislation, to be achieved through the two-day-a-month furlough plan," the court said.

While the court deliberated, state workers continued to be furloughed.

An Alameda County Superior Court judge had issued a temporary restraining order preventing the governor from implementing furloughs, but the state Supreme Court allowed furloughs to resume while it deliberated.

After an initial round of furloughs ended in June, the governor brought back three-day-a-month furloughs in late July while the state deals with a $19 billion deficit.

State workers dispute that the state has saved money through the furloughs, which have meant most state offices are closed on three Fridays a months.

"The furlough program may have satisfied the governor's need to inflict financial pain on the state work force, but we now know it did little to save money for California taxpayers," Patty Velez, president of the California Association of Professional Scientists, said in a statement. She is an environmental scientist at the Department of Fish and Game.

The new order exempts departments that collect revenue, such as the Franchise Tax Board, and provide public safety protection, including the California Highway Patrol.

It also exempts about 37,000 workers in six unions that recently reached tentative labor agreements with the Schwarzenegger 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's high court consolidated the appeals of several unions, including the Service Employees International Union Local 1000, the California Attorneys, Administrative Law Judges and Hearing Officers in State Employment, as well as the Professional Engineers in California Government.