Furlough Coming Soon For Many State Workers
Most state government employees will face furloughs beginning in 2021, as Hawai‘i faces massive budget shortfalls in the coming years.
Citing the coronavirus pandemic and Hawai‘i’s overwhelming economic reliance on the decimated industry that is island tourism, Governor David Ige said Wednesday afternoon that the state faces a $1.4 billion annual shortfall in each of the next four fiscal years. In response, the governor plans to furlough thousands of state employees for two days every month beginning Jan. 1 and continuing indefinitely.
“I have taken every action possible to avoid furloughs because I know how hard this will be to employes and their families,” Ige said. “The state is at a point where drastic measures are required to deal with this budget crisis.”
The governor added that the move, while severe, will allow most employees to keep their jobs, albeit at a lower monthly income. The administration projects the two-day furlough will equal a 9.2% pay cut to affected workers, saving the state an estimated $300 million over a one-year period. Ige and his cabinet members are self-imposing a 9.3% pay reduction in an effort to render financial sacrifice equitable across all levels of government.
“I will evaluate the need to continue the furlough on an ongoing basis. We will adjust as the economy recovers and tax revenues increase,” the governor said. “The furlough will be rescinded as soon as it is no longer needed.”
Not all state employees are affected by the furlough, namely those tied to necessary 24/7 operations. Those excluded from pay cuts include firefighters, first responders and public safety employees, nurses who work for round-the-clock care providers like hospitals, as well as correctional, institutional, and health workers who manage state prison systems.
Agencies that are not supported by the Hawai‘i General Fund, such as the Department of Commerce and Consumer Protection as well as the Department of Transportation, are also exempt from furloughs. This means no one employed by the DOT under the Airports, Highways, and Harbor Divisions will be forced into a pay cut.
The Department of Education and the University of Hawai‘i will be subject to the furlough program, though those entities have been given leeway to structure furloughs to best accommodate learning opportunities for the students who rely on them. Their strategies will be released in the coming days.
Ige said that the opportunity exists to overload school breaks with furlough days, meaning less of an impact on students’ day-to-day educations.
“Students will get the instructional days they need to get promoted to the next grade level,” he added.
However, just because students graduate doesn’t mean their educations won’t be potentially hurt by schools forced to choose between fewer teaching days and fewer training days for their educators.
Unions representing the thousands of workers set to receive less pay with no end date in sight have challenged the governor’s authority to unilaterally impose furloughs. Ige said he and his team have done the due legal diligence and believe that the authority is his to exercise. Any challenge to it would likely have to move through the courts.
The Hawai‘i Government Employees Association, the Hawai‘i State Teachers Association, the University of Hawai‘i Professional Assembly, and the United Public Workers released a joint statement Wednesday voicing their “strong opposition” to the governor’s furlough program.
“These furloughs and planned budget cuts announced just before the holidays (and) couldn’t come at a worse time,” the statement said. “These drastic cuts will carry devastating, long-lasting consequences, not only for state workers and their families.”
The statement cited a recently conducted study by UHERO, which asserts that every $1 reduction to state salaries equals $1.50 in damage to Hawai‘i’s economy.
“Mass pay cuts would throttle a key pillar of Hawaii’s economy — government — at a time when the tourism industry is still extremely weak and construction is slowing,” the statement continued. “Under Ige’s plan, thousands of public workers would be affected, including teachers, educational assistants, custodians, groundskeepers, cafeteria workers, social workers, university professors, engineers, building inspectors, those who care for our most vulnerable populations, and hundreds of other positions.”
More federal funding for Hawai‘i is likely in the coming months, as Washington nears agreement on a $900 billion relief package, with President-Elect Joe Biden indicating there is more to come after he takes office in mid-January. Some have argued this is reason enough to wait on such drastic measures at a state level.
Ige asserted, however, that whatever money comes, if it comes, won’t be enough. He added that furloughs can be reversed or eliminated quickly in response to funding at a level that would make a significant difference to Hawai‘i’s budget crisis.
“To those who say we can wait, I say any new federal funding we may receive will not make up for the massive budget shortfall we are presented with,” Ige said. “Every month we wait to take action makes us rack up more debt and (burn through cash on hand).”
There is no specific dollar amount on recouped revenues that will trigger an end to state furloughs, the governor continued. Rules will not change for employees when it comes to second jobs, and those who already hold them or are eligible to apply for them may continue to pursue complementary employment opportunities.