State furloughs preferred over layoffs

State agencies would be encouraged to require workers to take furloughs or to cut their hours before resorting to layoffs in the latest version of a recession-inspired state budget.

Among the other items legislators include in the proposed two-year budget:

• More leeway to offer early retirement to workers.

• Suspension of the state board that advises lawmakers on pension funding.

Those moves come on top of big cuts to state spending, set off by a continuing drop in tax income during a national recession. Majority Democrats estimate that their budgets make $4 billion in reductions, including layoffs of 7,000 or more employees in public schools and state colleges and agencies.

The Democrats on the Senate Ways and Means Committee, which made changes to the proposed budget this week, rejected a move by Republicans to reduce funding for state worker health insurance.

Sen. Joe Zarelli, the ranking Republican on the committee, said a 2 percent cut to funding for health insurance would be enough to reduce cuts to nursing home payments and other social programs from 5 percent to 2 percent.

"What I'm saying here is we ought to give something up," he said. He noted that state worker unions have agreed to go without raises and agencies have been under a hiring freeze, but workers have taken no actual reductions in pay or benefits.

Neither the Senate nor the House version of the budget provides enough money to pay for health-insurance cost increases, however, likely meaning higher co-pays or other fees for workers in the future.

"We've frozen their raises, eliminated their step increases. ... We've now taken away from their pensions and we're going to do layoffs," Sen. Karen Keiser, D-Kent said.

Cutting health benefits would be "just too much," she said.

The Washington Federation of State Employees estimates that the $400 million in deferred pension payments and other budget reductions directly affecting workers add up to $1 billion in the proposed budgets.

"They've given up enough," union spokesman Tim Welch said.

The union will oppose suspending the Select Committee on Pension Policy because it is the only body on which state workers have input into the pension funding process, Welch added.

As for reduced hours or furloughs, the union likely will demand to bargain with managers at individual agencies over proposals, he said.

"If any of these cost-savings sacrifices on the part employees don't save jobs, I don't think our members would support them," Welch said.