It’s not the first time that the Governator has tried this in the absence of a budget, but it will certainly be the last. Since California’s legislature failed to produce a budget, Arnold Schwarzenegger used his power as governor to reduce wages on most state workers to the federal minimum wage — and for some state workers, to zero. However, it’s unlikely that any worker will see their pay actually cut, even temporarily:
The Schwarzenegger administration today ordered State Controller John Chiang to reduce state worker pay for July to the federal minimum allowed by law — $7.25 an hour for most state workers.
The instructions from the Department of Personnel Administration exclude roughly 37,000 state workers in six bargaining units that recently came to tentative labor agreements with Gov. Arnold Schwarzenegger.
Some employees, such as doctors and lawyers, would get no pay because federal exempts them from any minimum wage requirement.
The minimum wage law has an exemption for lawyers? Someone on a Congressional staff is going to get an angry letter from the Trial Lawyers Association.
Schwarzenegger tried this in 2008, too, but it didn’t fly. The state’s controller refused to follow the edict, worried that the employees would sue in federal court. Also, the cost of the change in payroll would be substantial, and eventually the state would have had to fork over the back pay anyway. The change would only be temporary, and California would have to restore the earnings lost when the budget passed.
Instead of gimmicks like these, California’s political class should be looking at ways to actually reduce payroll by reducing the size and scope of government. It seems like Schwarzenegger and the legislature want to make the state’s bloated bureaucracy cost even more rather than address the real problems of their budget disaster — just as California has done for the past several years.