Court Rules in Favor of Calif. State Compensation Workers

About 7,900 employees of California’s State Compensation Insurance Fund are entitled to back pay after a state appeals court ruled in their favor over furloughs.

The First District Court of Appeal in San Francisco ruled that the same state law that exempts employees at the State Compensation Insurance Fund from hiring freezes and layoffs, also prohibits a reduction in workweeks.

In making its decision, the court endorsed a ruling by another appellate panel earlier this year that found Gov. Arnold Schwarzenegger acted illegally when he furloughed about 500 lawyers and hearing officers employed by the State Compensation Insurance Fund.

The furloughs were part of a cost-cutting move by the governor last year, when he ordered nearly 200,000 state employees to take two days off each month without pay.

The state Supreme Court has agreed to review the legality of all the furloughs.