The State Worker

Chronicling civil-service life for California state workers

July 20, 2010
Does state Supreme Court decision prohibit shielding state workers from minimum wage?

A couple of State Worker blog users have asked a question: Does the same state Supreme Court decision that Gov. Arnold Schwarzenegger has invoked to issue minimum wage orders in 2008 and this month also preclude appropriating payroll funds outside of the annual budget?

CAHP, CAPT, CDFF, UAPD, AFSCME and IUOE have tentatively agreed to labor contracts that shield their members from minimum wage in the event of a budget impasse. Controller John Chiang has said he won't comply with Schwarzenegger's latest minimum wage order because the state's payroll system is inadequate, both technologically and legally. He and the governor are suing each other in Sacramento Superior Court.

The 2003 Supreme Court decision that the governor has relied on as he has pressed the minimum wage issue, White v. Davis, contains this section:

In light of the explicit language of section 3517.6 ("("unless approved by the Legislature in the annual Budget Act" (italics added)), however, we cannot agree that the Legislature's initial approval of the memorandum of understanding in a nonbudget act, or its appropriation of funds in one or more (but not all) of the annual budgets of a multiyear contract, properly can be viewed as a continuing appropriation authorizing the Controller to pay salaries set forth in the memorandum of understanding in a new fiscal year without enactment of an applicable appropriation in that year's budget act.

Does that mean that the legislation we told you about in this Monday report can't shield those six bargaining units from minimum wage?

Here's what labor attorney Tim Yeung said in an e-mail to The State Worker when we asked whether White would somehow keep the governor from exempting some unions from minimum wage and not others:

My understanding is that if a MOU requires money, the Legislature must approve it. 3517.6 says in the "Annual Budget Act" - I'm not sure how flexible that term is since I know MOUs in the past have been approved at various stages throughout the maybe you can just call something an 'annual budget act' .......

However, my understanding is also that just because the Legislature approves a MOU -- even if in an Annual Budget Act -- that doesn't make is a continuing appropriation. To do that, you need some magic words like, 'without regard to fiscal years' in the bill. And that's how I think the Governor intends to protect certain unions from min wage. I think he's going to add 'without regard to fiscal years' or something like that to the language of the bill to make it a continuing appropriation.

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About The State Worker

Jon Ortiz The Author

Jon Ortiz launched The State Worker blog and a companion column in 2008 to cover state government from the perspective of California government employees. Every day he filters the news through a single question: "What does this mean for state workers?" Join Ortiz for updates and debate on state pay, benefits, pensions, contracts and jobs. Contact him at (916) 321-1043 and at


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