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Furlough agreement will not avert layoffs, governor warns


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POSTED: Friday, October 16, 2009

A new contract with the state's largest public workers union will bring “;substantial”; savings, but not enough to prevent the first round of layoffs for about 750 state workers, Gov. Linda Lingle said yesterday.

No decision has been made on whether a second round of layoffs would be needed to help close a budget deficit approaching $1 billion over the next two years, Lingle said.

Under the agreement announced Wednesday with the Hawaii Government Employees Association, workers would be furloughed 42 days over the next two years—equivalent to a roughly 8 percent wage cut.

Savings are estimated to be about $204 million over the fiscal biennium, which ends June 2011, according to the Governor's Office.

“;The savings that we're going to get from the furlough plan—it will be substantial, but it won't even come close to closing the budget deficit that we have,”; Lingle told reporters.

Union members, about 30,000, are voting on the agreement this weekend.

Even if the contract is approved, Lingle said the state will still need to proceed with the first round of layoffs.

About 1,100 workers initially were given layoff notices, but due to “;bumping”;—the ability of more senior workers to displace those with less seniority in the same job classification—the number is expected to be closer to 750.

Those layoffs would begin next month. The state expects to save about $30 million a year through layoffs, Lingle said.

With state revenues continuing to decline, Lingle said she would continue to explore all other cost- cutting options, including further spending restrictions on state departments and refinancing of debt.

“;We tried everything else before we ever touched our labor expenses,”; Lingle said. “;We've cut back on programs, on purchases. We've refinanced debt.

“;With everything we've done to cut back, we saved $2 billion, and yet even that wasn't enough to close the gap. We really had no choice.”;

;[Preview]    HGEA Members Vote On Tentative Agreement
  ;[Preview]
 

Members of the Hawaii Government Employees Association began ratification voting on a tentative agreement with the state.

Watch ]

 

An HGEA spokeswoman said the union had no further comment yesterday on the contract situation. HGEA Executive Director Randy Perreira issued a written statement Wednesday saying the union had tried to reach an agreement on a furlough plan that members could review and vote on.

The result of the statewide ratification vote is expected early next week.

Lingle said she had no expectation on the outcome but added she was hopeful the contract would be ratified.

Meanwhile, there continued to be no movement in negotiations with the United Public Workers union.

“;I don't know what their strategy is or what they feel they have to gain by this,”; Lingle said. “;I feel they need to come back, and they need to start talking seriously again.”;

A message left with UPW officials yesterday was not returned.