Don't Hold Your Breath: State Workers and Minimum Wage

File the following under the category of Scary News You Can Safely Ignore: today's headlines that the Schwarzenegger administration is going to cut state workers' pay back to minimum wage if a new state budget isn't approved by the constitutional deadline, June 30.

Why doesn't this threat -- contained in an internal memo obtained by the LA Times -- matter? Because it's unlikely to happen. The State Controller John Chiang, who signs workers' checks, is refusing to go along. He makes two objections, one legal and one practical. The legal one is that such a move by the governor might violate laws on overtime and employee benefits. The practical one is that the state's very old computer payroll system can't be easily changed to produce new minimum wage paychecks.

The Schwarzenegger administration disputes all this. But with Schwarzenegger and Chiang fighting this out in court, it's clear that nothing much is going to happen in this area.

(And even if it were to happen, don't weep for state workers. They'd be entitled to full back pay once the budget is settled).

So why is the governor raising this possibility? There's a bit of budget theater here; the threat is a way to let the public know that the situation is serious. And there's also a contest about power. Governors see it as their mission to protect the power of the governorship, and the governor's office maintains that one of those legal powers is to cut pay in the event there is no budget in place. Chiang, the controller with the power to write checks, is seeking to maximize the leverage and power that official rule gives him.

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