In the wake of deepening recession, the Californian government forced more than 200,000 of its employees to take an unpaid holiday on February 6 with another due on the third Friday of the month.
The unpopular step brought demonstrators on the streets protesting the decision which envisages government employees taking first and third Friday as unpaid holidays at least through June 2010 but Governor Arnold Schwarzenegger said that the alternative was layoffs.
The unpaid holidays will cost workers ten per cent of their salary but save the State around $1.3 billion. By 2010, the State expects to have a budget deficit of around $42 billion.
Employees in critical areas such as hospitals and prisons were not included in the Friday forced holiday which affected around 90 per cent of the workforce. But they were expected to take the unpaid off days later.
"The governor understands how difficult this is. And just like every California business and family is doing, the governor needs to cut back as well," said spokesman Aaron McLear.
Meanwhile, Democrats and Republicans lawmakers are deadlocked over the budget with Democrats favouring tax increased and some spending cuts and Republicans seek deep cuts but no budget increases.