Saturday, July 3, 2010
Min Wage Foiled by Old Technology for Now
Governor Schwarzenegger for the second time in two years has ordered most state workers' pay cut to the federal minimum wage because lawmakers missed their deadline to fix the state's $19 billion budget deficit. The Legislature's failure to act on time has left the state without a spending plan as the new fiscal year begins.
So let me get this straight. Because lawmakers missed the deadline to fix the state’s 19 billion dollar budget deficit state workers are now ordered a pay cut to min wage? Not only are we still in debt most California workers are receiving less pay as a punishment for the Legislature’s failure.
A state appellate court ruled in Schwarzenegger's favor Friday, but the state controller, who issues state paychecks, says he can't comply. One reason given by Controller John Chiang, a Democrat elected in 2006, is because the state's computer system can't handle the technological challenge of restating paychecks to the federal minimum of $7.25 an hour.
Chiang cited Friday's ruling by the 3rd District Court of Appeals, which said "unfeasibility" would excuse him from complying with Schwarzenegger's minimum wage order. He said a fix to the state's computerized payroll system won't be ready until October 2012.
But in the meantime, more than 200,000 state workers remain in an indeterminate state about the size of their July paychecks while Chiang asks the court for assistance on how to proceed. If wages are indeed cut to $7.25 an hour, employees will be reimbursed once a budget is signed but they suffer a not being able to pay all of their bills in the mean time.
The state's payroll system was designed more than 60 years ago and was last revamped in 1970, Hallye Jordan, state controller's office spokeswoman, said in an e-mail.
A report by the nonpartisan legislative analyst's office said an overhaul of the state's computerized payroll system was proposed by the controller's office in 2004. A year later, the Legislature approved $130 million for the effort, called the 21st Century Project.
The state fired the vendor carrying out the project in 2008 because the company went bankrupt. And as the project dragged on, the state has had fewer experts on hand who could thoroughly understand the programming languages used to design the system.
And what’s most annoying about this whole thing is that apparently the state isn't saving any money on paying them minimum wage. The average state employee makes $65,000 annually, according to the state Department of Personnel Administration. A cut to minimum wage would mean state workers would make the equivalent of $15,000 a year.
I’m just wondering why our Governor is continuing with this order if it really isn’t helping the state out in the first place.