Schwarzenegger signed the order in July as a response to the legislature’s inability to come up with a solution to the $15.2 billion deficit. The cut would immediately reduce the pay of roughly 180,000 state workers to $6.55 an hour—a $1.45 below California’s minimum wage. Employees would receive their full salaries once the budget was signed.
Schwarzenegger says the pay cuts will help the state avoid a cash crisis. He also laid off more than 10,000 part-time and seasonal workers.
State Controller John Chiang told the governor’s staff that the pay cut directive was complicated and would take at least a week to explore the possibility of implementation. On Wednesday, the Schwarzenegger administration filed a lawsuit against Chiang for not complying with the directive.
