About 50 people, many of whom were among those laid off, held signs that said "Pink slips = service cuts" and chanted "SEIU," for Service Employees International Union.
Newsom has promised to rehire the "vast majority" of the laid-off workers at 37.5 hours per week instead of 40, which would save the city $50 million next year in the face of a $522 million deficit.
But former full-time employees are concerned about becoming part-time and question the legality of the changes.
The mayor's office is currently negotiating with union leaders and looking at other cost-saving alternatives.
Workers who attended today's rally said they wanted to increase visibility and show the public that the lay-offs would directly affect the residents of San Francisco by resulting in service cuts and longer lines.
"We want to let people know they have a stake in this," said Wendy Kramer, who worked for the San Francisco Public Library for almost four years before she was laid off this month. "It's not just, 'Oh the union's upset.' It's the people who clean your streets, work in the offices. We want to make it real and concrete."
SEIU officials estimate that reducing the workweek to 37.5 hours would result in 8,500 fewer hours of service every day.
Kramer and others at the protest said they felt bullied by the mayor and called the pink slips a scare tactic.
Cathy Bremer, who worked for the San Francisco Public Library for more than 30 years before she was laid off on March 5, said the pink slips had made city workers despondent.
She said the workers weren't protesting the 2.5-hour drop in work week hours; they were protesting the part-time status.
"You can't say anymore that you have a definite salary," Bremer said. "At any time they could bring us down to 20 hours. I never dreamed I would do everything right for 30 years and then get a pink slip at the end." And not everyone will be rehired, she said.
The workers have questioned the legality of the layoffs and threatened to sue the city for violating the terms of their union contracts, which have them listed as full-time employees.
Newsom put a temporary moratorium on the 37.5-hour workweek plan last week, and today, he extended it for another week.
Newsom spokesman Tony Winnicker said the idea is still on the table, but other options are being considered.
"We're making progress in discussions," he said. "We have a shared understanding of the problem and what it's going to take to get to solve it. Our priority is to work together to close the budget deficit for next year."
Winnicker declined to comment specifically on today's protest but said the negotiations were going well.
"Although we have tough choices, we believe all sides are committed to working together," he said.