California High Court Upholds Furlough Order

SAN FRANCISCO (CN) - The California Supreme Court on Monday unanimously upheld Gov. Arnold Schwarzenegger's furlough plan for state employees, saying the governor had the legal authority to mandate that 200,000 workers take three days off each month without pay.

Facing a $40 billion budget deficit, Schwarzenegger issued an executive order on Dec. 19, 2008, instructing the Department of Personnel Administration to implement his plan to furlough workers two days a month, later adding another furlough day.

The furloughs reduced employee earnings by about 10 percent and lasted until June 30, 2010.

Professional Engineers in California Government, a state attorneys' group, and the Service Employees International Union Local 1000 immediately filed suit, claiming the furloughs were unconstitutional.

Alameda County Superior Court Judge Frank Roesch upheld their claims in March. Had the state Supreme Court agreed with him, workers would have been entitled to more than $1 billion in back wages.

But the high court rejected Roesch's ruling, finding that lawmakers had endorsed the governor's order by adopting state employee pay reductions attributable to the furlough program in its 2008 Revised Budget Act.

The phrase "existing administrative authority" in the 2009 revised budget gave Schwarzenegger the power to reduce state workers' pay, the high court ruled.

"That phrase, in the context in which the revised budget act was adopted and in light of the provision's legislative history, reasonably included the furlough program that was then in existence and that had been authorized by the current gubernatorial administration," Chief Justice Ron George wrote. "Accordingly, we conclude that the 2009 budget legislation validated the Governor's program here at issue, and reject plaintiffs' challenge to the program."

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