Gov. Arnold Schwarzenegger warned Wednesday that if state workers don't accept twice-monthly furloughs, he will pursue layoffs to reduce salary costs by more than a billion dollars.
The Republican governor signed an executive order last month requiring 238,000 state workers to take two unpaid days off each month starting in February. The state also began warning state workers with the least seniority that their jobs were threatened.
Labor unions are fighting the governor's furlough order in Sacramento Superior Court, where a judge is expected to rule as soon as today whether Schwarzenegger's plan is constitutional. The governor said at the Sacramento Press Club that if he loses the case, he will pursue layoffs instead, which pose fewer legal problems.
"To me, labor has the choice, and I made this very clear: They can help us make the decision in how we can save the ($1.3 billion)," he said. "So our recommendation was furloughs, where everyone takes a little haircut, rather than laying people off.
"That's the last thing I want to do, is lay people off. So it's their decision."
Schwarzenegger already has proposed saving $150 million through layoffs and "efficiencies" in his January budget; the furloughs would save $1.3 billion on top of those job cuts. The governor also wants to drop two state holidays and eliminate overtime pay for those who work on the remaining holidays.
"The fact of the matter is in the end I have the authority as the governor, if they don't go along with the furlough, to lay off the amount of people necessary so we have a savings of ($1.3 billion)," he said.
Schwarzenegger aides are negotiating daily with labor unions to compromise on ways to save money. Jim Zamora, spokesman for Service Employees International Union Local 1000, which represents 95,000 state workers, said the governor has implied his layoff threat in the past but has never before been so blunt in public.
Zamora said talks have been fruitful.
"What we've been trying to do is come up with alternatives that avoid layoffs and mitigate furloughs as much as possible but still achieve his cost-saving goals," Zamora said.
The governor said Wednesday that while talks to close the state's $40 billion budget gap appear unproductive, he has sensed a "will to get this done" among legislative leaders.
The state risks running short of cash if leaders do not adopt budget changes by next month.
Call Kevin Yamamura, Bee Capitol Bureau, (916) 326-5548.
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