Wilson Urges Loosening of Overtime Pay Requirement : Labor: Governor wants extra compensation to be based on hours worked per week, not per day. His proposal sparks Democratic outrage.

Gov. Pete Wilson, his opinion-poll numbers declining at home while he pursued his presidential bid out of state, turned his attention back to California on Friday--and immediately created a firestorm of Democratic and labor protest over a move to cut overtime pay for wage earners.

Currently workers in California who are eligible for overtime must be paid at the rate of time and a half on their hourly rate after putting in eight hours in a single day.

Wilson asked a commission whose members he appointed to strike down the state requirement and adopt a federal law on overtime that is less restrictive for employers. It requires that those workers be paid overtime only after completing 40 hours of work per week.

Maintaining that employees as well as employers would benefit from more “flexible schedules,” Wilson said overtime costs mount up “whenever an employee works over eight hours in a day, even if hours are only adjusted on a couple of days in a week.”

It is “counterproductive,” he said, “for the state to hit employers with a daily overtime financial penalty when an employee’s total time worked does not exceed 40 hours in a week.”

Thirteen Assembly Democrats, several leaders of organized labor and the leader of the state Senate, Democrat Bill Lockyer of Hayward, immediately attacked the proposal, accusing Wilson of trampling on American labor traditions, imposing hardships on working people and trying to attract more contributions from business interests to boost his presidential campaign.

“Outrageous,” said Lockyer. “[Wilson] may have some big contributors who think that it is a great idea. [But] the governor shouldn’t be in the forefront of advancing the destruction of the middle class.”

In another gesture to business interests, Wilson repeated his pledge to forge ahead with his proposal for a 15%, three-year, across-the-board state income and business tax cut.

Addressing a California Chamber of Commerce breakfast, the governor declared that the state’s economy remains on the rise thanks to a friendlier business climate, one he intends to encourage with the tax reduction and other measures.

Already during the last three years, Wilson said, 250,000 jobs have been created, “all part of what we call the California comeback.” But he said many of the “reforms” he has sought--welfare cuts and stemming illegal immigration--have been “stifled by a federal government that is out of step, out of touch and out of control.”

On the overtime issue, Wilson released the contents of a letter he wrote to the state Industrial Welfare Commission, which has the authority to adjust worker pay rules.

“I am writing,” Wilson said, “to request [the commission] . . . to reform . . . wage orders requiring daily overtime after eight hours in a day in the interest of promoting greater flexibility and enhancing California’s competitiveness.”

The panel is composed of two members representing employers, two from organized labor and one from the general public, all appointed by the governor and confirmed by the state Senate.

Democratic Assemblyman Wally Knox (D-Los Angeles), a labor lawyer, called the panel a “kangaroo court” doing Wilson’s bidding. Tom Rankin of the California Labor Federation AFL-CIO said that since the commission has refused to raise the minimum wage from $4.25 an hour, it is likely to accede to Wilson’s wishes on overtime.

Wilson’s move, Knox said, is of “questionable legality and real inhumanity. . . . You could design your entire work force to work 14 to 16 hours a day, two days in a row, and then have a turnover to another work force” doing the same--and pay no overtime.

Lloyd Aubry, head of the state Department of Industrial Relations, said the Democrats were exaggerating the likely effects of the rule change.

“There are 100 million workers [nationwide] working under the eight-hour rule, and to suggest that it is somehow inhumane is hyperbole,” he said.

The Field Poll reported that President Clinton’s lead over Wilson in California in a potential November, 1996, matchup has grown steadily, from 3 percentage points in February to 19 points this month.

Times staff writer Carl Ingram contributed to this story.