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California Supreme Court upholds state furloughs

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in Employment Law,Human Resources

For a while, there was some doubt that outgoing Gov. Arnold Schwarzenegger could legally force unionized state employees to accept furloughs ordered to ease California’s budget crisis. Then, shortly after the furloughs were announced, the Legislature passed a revised budget calling for payroll reductions.

Now the California Supreme Court has ruled that the furloughs were legal.

Recent case: Back in late 2008, Schwarzenegger ordered state employees to take time off, essentially reducing their pay by 10%. Unions sued, alleging the move violated their contracts. Then the Legislature retroactively reduced the 2008 budget figures.

The California Supreme Court concluded that even if the governor didn’t have the power to unilaterally change union contracts, the legislation forced him to. (Professional Engineers, et al., v. Schwarzenegger, et al., No. S183411, Supreme Court of California, 2010)

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