By James Kelleher
MADISON, Wis (Reuters) - Wisconsin Governor Scott Walker was expected to sign into law on Friday sweeping new limits on collective bargaining for public sector workers that have sparked a national debate over labor relations.
In a major setback for organized labor, the state Assembly on Thursday voted 53-42 to approve the controversial bill, which has triggered the biggest demonstrations in the Wisconsin capital since the Vietnam War. The state Senate had earlier approved the measure despite a boycott of Democratic senators.
Walker has said the bill, which sharply limits the union rights of public workers and requires them to pay more of their health insurance and pension costs, was needed to help the state close a $3.6 billion budget deficit over two years.
The governor said on Friday that he was canceling the layoff warning notices he sent late last week to public sector unions after lawmakers approved his proposal to restrict the collective bargaining rights of those unions.
Walker said the new powers for state and local government in the bill, which he is expected to sign into law as early as Friday, would save $30 million in the current budget year, which ends June 30.
"While tough budget choices certainly still lie ahead, both state and local units of government will not have to do any mass layoffs or direct service reductions because of the reforms contained in the budget repair bill," Walker said in a statement.
(Editing by Greg McCune)