The Governor is allowed to pay California state workers the federal minimum wage in the absence of a budget. The new fiscal year began today, July 1, and as there is no budget the Governor issued an order to the Controller that civil servants' pay shall be reduced to $7.25 an hour for the month of July and for every month until there is a budget. And that's if they are lucky; some classes of civil servants, such as attorneys, won't get paid anything, although all employees will (eventually) be given back pay once a budget is signed.
This isn't the first time Governor Schwarzenegger has played the minimum wage card. He has ordered minimum wage in previous budgetless summers, but the Controller, John Chiang, has argued that federal law and an aged payroll system make it impossible for him to comply.
So far, John Chiang has lost on the legal issues, and his only remaining argument is that the jury-rigged computer system, held together with grape skins and unicorns' breath, is not up to the task. The "it isn't you, it's me" argument might work up to a point, except for one thing: Sacramento is only about 90 miles from Silicon Valley, and a handful of software engineers could solve John Chiang's intractable resource issue within a week.
The six unions that have agreed to givebacks are exempted from the minimum wage directive, and will be paid their regular (if reduced) salaries. But SEIU, California's largest public sector union, has yet to agree to a deal.
And nobody knows who will blink first.