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Connecticut governor lays off workers, union bucks cuts

NEW YORK (Reuters) - Connecticut began mailing layoff notices to 4,742 public workers because their unions have not made enough cost-saving concessions, Governor Dannel Malloy said on Tuesday.

Malloy, a Democrat, is among Democratic and Republican U.S. governors demanding unionized public employees accept lower pay and benefit packages to help close state budget deficits.

"I am attempting to bring the benefits enjoyed by state employees -- wages, healthcare, and pension benefits -- more in line with those enjoyed by their counterparts in the private sector and federal workforce," Malloy said in a statement.

The public sector traditionally paid less than private employers but offered the security of iron-clad pensions.

Some politicians including New York City Mayor Michael Bloomberg, a political independent, say vote-seeking lawmakers pushed the public system out of balance by approving overly rich pay and benefit hikes for government workers.

Unions counter that their members should not be punished for the recession and that claims of high pension payouts are often exaggerated. The average pay for a New York state worker, for example, is $47,164 and the average pension is $18,300, according to the state comptroller's data.

Connecticut now has about 50,000 public employees and the State Employees Bargaining Agent Coalition said its leaders will continue meeting with Malloy's team "for at least one more day, in the hope of achieving a just and fair outcome."

Saying Wall Street and the "super-rich" should sacrifice more, the union added: "Middle class workers, whether public or private, did not cause Connecticut's economic problems and should not be asked to bear an unfair burden in their resolution."

The battle between public workers unions and states has intensified around the nation. Wisconsin is waiting for a judge to decide if it can strip collective bargaining rights from public unions, because most states' revenue has yet to bounce back from the recession.

Connecticut closed a more than $3 billion deficit in its new $40 billion two-year budget with a combination of sweeping cuts and numerous tax hikes, ranging from cigarettes to income.

Another $1 billion must be cut in each of the next two budget years that begin on July 1, Malloy said.

"I refuse to raise taxes beyond what has already been agreed to," Malloy said. Saying he had hoped to avoid layoffs, Malloy said this measure was -- just like his tax hikes -- part of "asking everyone to share in the sacrifice, including my fellow state employees."

(Reporting by Joan Gralla; Editing by Andrew Hay)