Facing pressure from environmental groups and labor unions, California has decided to stop using federal prisoners, paid as little as 20 cents an hour, to dismantle the mountains of potentially hazardous electronic junk discarded by state bureaucrats.

The decision by the California Department of General Services to stop sending electronic waste to federal prisons and to hire a private recycler instead was disclosed a month after Dell, the nation's largest computer maker, canceled a similar prison labor arrangement. Dell's deal also had been fiercely criticized conservationists wore striped prison garb at a computer industry event and accused Chief Executive Michael Dell of hiring a "high-tech chain gang."

The defections leave the future of the computer recycling program run by UNICOR ? an arm of the federal government that uses prison inmates in business ventures ? in limbo only months after it seemed poised to become a major player in the emerging business.

As computers become common in homes and workplaces, and consumers upgrade to newer technologies, electronic waste has begun to pile up all over the world, posing a serious environmental problem. Most televisions and monitors contain several pounds of lead apiece, for example, and governments, including California's, have banned them from landfills.

However, recyclers equipped to handle tons of old computers and televisions are relatively scarce and expensive. With a captive work force of prisoners paid far less than the minimum wage, UNICOR began to fill the void, agreeing to accept the material for rock-bottom prices. Critics said UNICOR was undercutting efforts to launch a recycling industry and taking jobs from law-abiding Americans.

"This is great news for the real e-waste recycling industry," Mark Murray, director of the group Californians Against Waste, said of the state's decision. "This is obviously a huge contract," and the decision will enable a private recycler to "make the investments they need for the future."

In a recent report, the Silicon Valley Toxics Coalition, an environmental group that has documented the electronic waste problem, condemned the federal prison recycling program. Representatives of the coalition had toured the program's largest operation, the Atwater federal penitentiary. The report, which compared the federal prison operation with a Hewlett-Packard recycling center in Roseville that uses union labor, concluded that inmates were using primitive tools to break apart the computers and monitors, exposing themselves to health hazards.

"I blow out black mucus from my nose every day," one prison laborer later wrote in a letter to the group. "The black particles in my nose and throat look as if I am a heavy smoker."

UNICOR strongly rebutted the report's description of its operation as a "Dickensian world of prisoners condemned to dangerous work for little pay under backward conditions." UNICOR noted that the state had given the Atwater site passing marks in a recent inspection, that prisoners had volunteered to take part in the program and that a waiting list of others hoped to do the same.

But the public relations damage has been profound. After Dell pulled out of its UNICOR deal, organized labor officials met with members of Gov. Gray Davis' administration and lobbied the state to follow suit. California had sent 370 tons of electronic junk to the prison recycler over 12 months.

"In this age, when we have jobs leaving the state, going across the border, we need to promote an industry that provides good jobs like recycling," said Mark Martin, a machinists' union representative who met with state officials.

Last week, the state canceled the UNICOR contract. It then asked private recyclers to submit bids to handle the state's computer junk.

"It's been the governor's wish that private industries take this on," said Robb Deignan, a spokesman for the Department General Services. He downplayed suggestions that labor unions had pressured the state, adding, "I think there might have been a concern about the methods being used" by UNICOR.

Larry Novicky, the head of UNICOR's recycling division, declined to comment Tuesday.

"We wouldn't characterize their decision," said Bureau of Prisons spokeswoman Traci Billingsley, referring questions to state officials.

The Bureau of Prisons rejected a request by The Times to tour the computer recycling facility and interview workers last month, citing security concerns.