Guards’ Contract Calls for 5% Pay Cut : Labor: Proposal must be approved by correctional officers. Wilson Administration says at least 3,064 state employees face layoffs.

Negotiators for the 18,000-member California Correctional Peace Officers Assn. tentatively agreed Thursday to accept an unprecedented 5% pay cut and rollback on health and dental benefits, giving Gov. Pete Wilson his first victory in bogged-down negotiations with state employee unions.

A jubilant Wilson said the new contract, if ratified by the Legislature and approved by corrections officers, would avert the layoffs of hundreds of prison guards. “It means more than 1,000 jobs will be saved, ensuring the security of the state’s correctional facilities,” Wilson said.

In another development, Administration officials disclosed that they have plans to lay off at least 3,064 state employees by the end of January. The Department of Corrections was among the state agencies targeted for layoffs on a list obtained by The Times, although the department has already lost 2,000 positions through attrition and budget cuts. Administration officials had spoken before of reducing state employee ranks, but not in detailed numbers.

Departments hit hardest by the layoffs would be Health Services, which would lose 800 employees; Social Services, 614 workers; Rehabilitation, 537; the Military Department, 225, and Alcoholic Beverage Control, 173. The remaining 715 layoffs would be spread among 27 other departments.

Administration officials, continuing to play hardball with other unions, said that unless employee groups agree to Wilson’s terms soon, more layoffs will occur.

At issue is more than $800 million Wilson must cut, much of it from the state payroll, as part of a $55.7-billion budget deal he reached with the Legislature in July to close a $14.3-billion budget gap.

The negotiators for corrections officers, becoming the first union leaders to reach accord with the Wilson Administration, signed a one-year contract Thursday morning after an all-night bargaining session, officials close to the talks said.

By coming to terms, the union gave Wilson a huge boost. The corrections officers had been major financial contributors to Wilson during the governor’s election campaign last year. Many other state employee groups that had supported Wilson’s opponent, former San Francisco Mayor Dianne Feinstein, figured that if any union could force the governor to back down, it would be the corrections officers.

The pay cut would be effective Oct. 1, reflected in paychecks delivered Oct. 31. The agreement calls for salaries to be restored next June 30 if the state’s economic picture improves and a reserve of $1.6 billion can be projected for the next budget year.

Jeffrey D. Thompson, a lobbyist for the CCPOA, said bargainers for the union won numerous non-economic concessions from the Administration, such as promises of more safety equipment, improved grievance procedures and recognition of seniority in work schedules within prisons.

Even so, Thompson said getting the rank and file to approve the contract is expected to be tough.

“We don’t like it, we are not asking our membership to like it, but we think it is the best we could do given the fiscal realities of the state. It has been an extraordinary year, with the state hit with its worst financial crisis ever,” Thompson said.

Word of the agreement began circulating in the Capitol just about an hour before a coalition of unions representing most other state employees held a news conference to call for a suspension of their five-month talks with the Wilson Administration. The unions said they are asking Wilson for a three-month “cooling-off” period, during which they would test a voluntary work furlough program that would avoid layoffs.

Pat McConahay, a spokeswoman for the California State Employees’ Assn., said unions were opposed to Wilson’s demand that they accept a 5% pay cut. “If the correctional officers want to take their cuts, it’s their choice. But we are not going to let it affect us,” she said.

David J. Tirappelle, director of the Department of Personnel Administration, which is handling the negotiations for Wilson, said the Administration would not agree to a suspension of talks.

“Every month that goes by, we lose $15 million in savings we anticipated in the budget, which means there will have to be even more layoffs. We don’t see where waiting is going to do anything but exacerbate the problem,” he said.