Saturday Mail Delivery – Is it Worth the Huge Cost?

One Response to Saturday Mail Delivery – Is it Worth the Huge Cost?

1. Tina says:

   Sunday, November 21, 2010 at 1:08 pm

   I did some research and found some interesting information for those who don’t mind reading cut and paste. As with most other businesses 80% of the operating costs can be found in employee compensation; I imagine fuel costs are also quite high:

   http://postalwork.net/pay_scales.htm
   The average pay and benefits for career bargaining unit employees was $63,771 per year, excluding corporate-wide expenses, in 2007. The largest pay system in the Postal Service is predominantly for bargaining unit employees. There are also Executive and Administrative Schedules for non- bargaining unit members, with pay ranging from $20,875 up to an authorized maximum of $108,166.

   http://www.usps.com/employment/compbenefits.htm

   In addition to highly competitive basic pay rates, most Postal Service employees also receive regular salary increases, overtime pay, night shift differential, and Sunday premium pay. Overtime is paid at one and one-half times the applicable hourly rate for work in excess of 8 hours per day, or 40 hours within a workweek. Night shift differential is paid at a specified dollar rate for all hours worked between 6pm and 6am. Sunday premium is paid at 25 percent for work scheduled on Sunday.

   Employee benefit pkg:

   The Postal Service participates in the Federal Employees Health Benefits (FEHB) Program, which provides excellent coverage and flexibility with most of the cost paid by the Postal Service. There are many plans available, including both traditional insurance coverage and Health Maintenance Organizations (HMOs). Employee premium contributions are not subject to most taxes, making health insurance even more affordable.

   The Postal Service participates in the federal retirement program, which provides a defined benefit annuity at normal retirement age as well as disability coverage.

   Career postal employees may contribute to the Thrift Savings Plan (TSP), which is similar to 401(k) retirement savings plans offered by private sector employers. Employees contribute to TSP on a tax-deferred basis, and may receive automatic and matching contributions (up to 5 percent of pay), after a waiting period, from the Postal Service.

   Newly hired postal employees are covered under Social Security and Medicare. (Is this temporary during a new hire probation or is it a cost saving permanent change for the PO that will shift all future employees to the SS & Medicare system?)

   The Postal Service offers coverage through the Federal Employees’ Group Life Insurance (FEGLI) Program. The cost of basic coverage is fully paid by the Postal Service, with the option to purchase additional coverage through payroll deduction.

   Career employees may participate in the Flexible Spending Accounts (FSA) Program after one year of service. Tax-free FSA contributions can be used to cover most out-of-pocket health care and dependent care (day care) expenses. (Interesting that Democrats have faught against these for the public sector time and time again!)

   The Postal Service offers a generous leave program to career employees that includes annual (vacation) leave and sick leave. For the first 3 years of service, full-time employees earn 13 days of annual leave per year, increasing to 20 days per year after 3 years of service, and to 26 days per year after 15 years of service. In addition, full- time employees earn 13 days of sick leave per year as insurance against loss of income due to illness or accident.

   The Postal Service observes 10 holidays each year.

   And this is how changes in wages and benefits are determined:

   http://www.federaldaily.com/postal/overview.htm

   An overwhelming majority of postal employees belong to either labor unions or one of the management or supervisory organizations. The 1970 Postal Reorganization Act authorized collective bargaining on wages and working conditions under laws applying to the private sector and provided for binding arbitration if an impasse persists 180 days after the start of bargaining. The ability of many postal employees to bargain over their pay rates is a right that is not enjoyed by other federal employees, although postal workers, like other federal employees, are still barred from striking.

   Four large postal unions represent most postal workers and negotiate for them during collective bargaining. They are:
   The American Postal Workers Union, AFL-CIO, representing more than 330,000 postal workers and retirees. APWU represents USPS workers in the clerk, maintenance and motor vehicle crafts.
   The National Association of Letter Carriers, AFL-CIO, representing about 300,000 active and retired members, of which more than 214,000 are active city delivery carriers.
   The National Rural Letter Carriers Association, representing 112,700 postal workers – active and retired.
   The National Postal Mail Handlers Union, representing more than 50,000 mail handlers.
   In addition to the four major unions, there are smaller unions representing postal inspectors and postal nurses.
   Three management associations represent postal supervisors and postmasters. These associations cannot bargain over pay issues like the unions but they do negotiate over other working conditions. The associations are:
   The National Association of Postal Supervisors. NAPS represents 35,000 active and retired supervisors and managers.
   The National Association of Postmasters of the United States. NAPUS represents more than 42,000 active and retired postmasters and officers in charge.
   The National League of Postmasters. The League represents 27,000 active and retired postmasters.

   Surely there is room in this maze of pay and benefits, not to mention levels of oversight and “bargaining” where cuts could be made and efficiencies bolstered.

   Consider Jacks idea of Saturday delivery with elimination of Monday delivery. That works well unless Saturday is considered an overtime day. Aparently night shifts are overtime work (why?). Changing those hours to regular pay hours would save a lot.

   When I searched for those fuel costs I also found a new bureaucratic (green) layer had been added to the cost of delivering mail:

   http://www.usps.com/green/sspp/2010/sspp_overview.pdf

   We will engage our nearly 600,000 employees in our efforts to reduce both energy use and our impact on the environment. And we will take advantage of improved measurement systems, advances in renewable energy sources and comprehensive employee education to help us meet our goals.

   The Postal Service owns and operates more than 217,000 vehicles. In FY 2009, our fleet used about 147 million gallons of gasoline equivalent (GGE), including 145 million GGE of petroleum fuel and 2 million GGE of non-petroleum fuel. This equates to about 16 percent of the Postal Services total energy use.

   We will focus first on facility and fleet energy use, and then extend our efficiency practices to water and other resources. And we are incorporating new efficiency standards into mail processing equipment and facility designs.

   To enable employees to make sound sustainability decisions, we’ll deploy Lean Green teams to 100 percent of USPS districts and network distribution centers in the next two years. These teams are part of the Lean Green Initiative, a program that focuses on broad-based employee education and engagement, allowing employees to take steps individually and collectively to reduce energy and preserve resources. The teams will help USPS achieve corporate and facility goals of improved sustainability performance.

   In April 2009, locations that piloted the Lean Green Initiative generated an average $500,000 in annual savings across the five areas of focus facility energy, owned-vehicle fuel, waste, materials and water. (A fine achievement…now tell us in terms of production regarding the movement of MAIL how much money was wasted while the Lean Teams focused attention on training and implementing green goals)

   Deployment to districts is now under way. The teams will encourage low-cost, or no-cost, ways to make the Postal Service even more sustainable by improving use of resources and minimizing impact on the environment.

   We once sent a state bid through the PO overnight delivery system. The bid had been sent to us at the last minute so we had no choice. The Postal employee assured us it would absolutely be delivered the next day (the closing date of the bid) when we explained the importance of a timely delivery. It arrived a few days late and of course we lost the bid. When we inquired at the PO we were told overnight delivery wasn’t a certainty; they just tried to get it there overnight. Perhaps the employees were in training to maximize green savings and too busy to get the mail delivered on time.

   The Post Office needs to become a lean mail delivery machine. Darrell Issa provides some insight into the roadblocks:

   http://www.washingtontimes.com/news/2010/sep/20/time-for-another-government-bailout/

   Time for another government bailout – The Post Office wants your money to protect its monopoly, by Darrell Issa – Washington Times

   Labor costs account for 80 percent of USPS operating expenses. Yet because of union contracts that contain “no-layoff” clauses, thousands have less than a full day’s work, and some are even paid to sit in empty rooms.

   Last year, USPS revenues declined 9.1 percent, and without permission from Congress to delay requirements to pre-fund some worker benefit plans, the Postal Service would have lost $5.2 billion. A $7 billion loss is anticipated this year.

   While postal employee unions have cooperated on efforts to reduce the work force through attrition and incentives for early retirement, those efforts simply have not resulted in the kind of change and transformation USPS needs to cover its costs. Unions have balked at the idea of changing contracts that refuse to allow necessary layoffs even if workers would be offered the opportunity to be retrained and fill other positions in the federal government.

   The difficulty and uniqueness of the situation for USPS is that there is little incentive to cut costs. Under current labor agreements, if USPS and its employees have a dispute over compensation, the negotiations are sent to a binding arbitration board. Unlike almost any normal labor arbiter in a private business, this board does not have to consider the financial condition of USPS when deciding compensation questions.

   Our Pubbies certainly have their work cut out for them!

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