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As prospects dim for postal reform, Senate bill already encountering flak

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Only days after it was introduced, a proposed Senate overhaul of the U.S. Postal Service is taking its lumps from both organized labor and the mailing industry.

“This bill is fatally flawed,” Cliff Guffey, president of the American Postal Workers Union, said in a Friday statement denouncing the legislation as a betrayal of USPS employees.

The Association for Postal Commerce, which represents business mail users, has some “significant issues” with the measure, such as its idea for widening the Postal Service’s discretion in applying an inflation-adjusted cap on rate increases for standard mail and other areas where it dominates the market, the group’s president, Gene Del Polito, said in a phone interview Monday.

Sens. Tom Carper, D-Del., and Tom Coburn, R-Okla.,  introduced the bill Thursday as lawmakers were leaving town for their customary August break, meaning that no action will be possible until next month at the earliest. The two are the chairman and top Republican, respectively, on the Senate committee that oversees the Postal Service. Their bill came after months of discussion; a joint news release makes clear that both believe there’s still a ways to go.

“This bill isn’t perfect and will certainly change as Dr. Coburn and I hear from colleagues and stakeholders, including postal employees and customers,” Carper said. More pointedly, Coburn described the bill as a “rough draft of an agreement subject to change.“

But dialogue takes time and, with time running out for action, that tentative note underscores the growing odds that Congress will once again fail to approve any kind of comprehensive postal fix.

For one thing, the Senate bill differs significantly from the measure approved last month by the House Oversight and Government Reform Committee; for another, the Postal Service is doing a bit better than expected this year.

How much better will become clearer this Friday when the mail carrier releases its third-quarter financial results. But as Federal Times has previously reported, Postmaster General Pat Donahoe said last month that projected losses—originally pegged at $7.6 billion in fiscal 2013—will be closer to $6 billion. That may be relatively good news from a balance-sheet standpoint, but politically it means less pressure on Congress to move. And next year is a mid-term election year, meaning that lawmakers will even be  less inclined to take the kind of tough votes that any serious postal overhaul is sure to demand.

Among other features, the Carper/Coburn bill would:

Require the Postal Service to continue Saturday mail delivery for at least one year while pressing the agency to replace door-to-door delivery with cluster boxes or curbside delivery when cheaper.

Require the Office of Personnel Management to recalculate the Postal Service’s pension obligations based on assumptions tailored to USPS employees rather than the federal workforce as a whole. Long story short, this step would likely reduce the amount that the Postal Service would have to pay into the two main federal pension programs and thus free up money for other purposes.

Revamp the federal workers’ compensation program.

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For letter carriers, new contract certain to show the strain of tough times

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As early as this week, members of the National Association of Letter Carriers could get the terms of a new contract. Whatever a three-man arbitration panel decides, the outcome is sure to furnish fresh evidence of the painful tradeoffs facing labor as the embattled U.S. Postal Service presses to cut personnel costs.

NALC members “understand that difficult things were necessary,” Jim Sauber, the union’s chief of staff, said in an interview today. “But on the other hand, we also want to reward the people who are working harder and have harder jobs.”

The NALC, for example, is proposing to create a new class of lower-paid, non-career employees dubbed “city carrier assistants” that would replace an existing classification known as transitional employees.  Although those carrier assistants would earn less than today’s transitional employees, they would get first shot when it comes to applying for career letter carrier jobs, Sauber said.

Under the NALC’s proposal, “both sides kind of get what they wanted,” Sauber said. “Even though the pay is lower, we think it’s going to be a better result for the people who take these jobs.”  But in written testimony to the arbitration panel, union President Fredric Rolando underscored that the organization is only reluctantly pursuing this option. “We trust that the panel will appreciate that, but for the present crisis, the concept of a lower paid, non-career letter carrier workforce would be totally unacceptable to the NALC,” he said.

For the arbitration panel, Sauber said, the key issues are now how many non-career employees to allow and how much to pay them. The Postal Service, he said, wants more such employees with lower compensation than the union has proposed.  According to Rolando, the Postal Service also wants to freeze wages, eliminate cost-of-living increases and cut benefits for career employees. All three are “completely unacceptable” to the NALC, he said in his testimony posted on the union’s website.

A USPS spokesman, citing standard policy, declined to discuss labor negotiations.

But the NALC isn’t just up against postal leaders intent on more payroll reductions as the agency continues to hemorrhage red ink. The organization is also battling precedent set by previous contract decisions involving two other postal unions. In 2011, the American Postal Workers Union agreed to a two-tier wage system that pays new career employees less. Last July, the National Rural Letter Carriers’ Association had to swallow a similar arrangement under a new contract set by a separate arbitration board.

With about 180,000 employees in its bargaining unit, the NALC is among the largest of the four major postal unions. It has so far successfully fought the Postal Service’s efforts to eliminate most Saturday delivery, a move the agency estimates would save about $2.7 billion a year. But Sauber stressed the union’s work with management to slash the number of routes as mail volume has declined—a step that puts more work on remaining letter carriers.

“We feel like we’ve been a very responsible bargaining partner with the Postal Service,” he said. “We didn’t stick our head in the sand when the crisis hit.” The new contract will replace an agreement that formally expired in November 2011. Rolando’s testimony, incidentally, is noteworthy for the disappointment expressed with the Obama administration, which has endorsed five-day delivery.

The White House, he said, “is like a deer frozen in the headlights on postal issues.” Despite the union’s political support, Obama “has not been of any great help on our critical issues, and we have to own up to that.”

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Postal union political spending up this election

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Organized labor may be hurting, but it would be hard to tell from the amount of money that the four big postal unions are spending on this year’s presidential and congressional races.

According to their most recent disclosure reports filed earlier this month, the four–through their political action committees–had shoveled about $9.6 million into the 2012 election cycle, already ahead of the $8.9 million total for 2010, a non-presidential election year, according to data compiled by the non-partisan Center for Responsive Politics.

Accounting for more than half of the 2012 sum was the National Association of Letter Carriers, followed by the American Postal Workers Union, the National Rural Letter Carriers’ Association and the National Postal Mail Handlers Union.

The stepped-up giving comes as Congress is struggling to find a fix for the U.S. Postal Service’s myriad problems that could have far-reaching consequences for rank-and-file employees, particularly if lawmakers agree to the agency’s plan to end most Saturday mail delivery.

In regard to campaign contributions, the bulk of union giving has been directed to Democratic candidates and party organizations, although an occasional Republican does turn up as a recipient. Most notably, the rural letter carriers’ PAC gave $8,500 to Rep. Darrell Issa, R-Calif., the House Oversight and Government Reform Committee chairman who wants to eliminate layoff protections from future Postal Service labor contracts.

Here’s the spending breakdown for 2012 and 2010:

Union            2012                    2010

NALC:       $5,751,165       $5,407,918

APWU:     $2,136,855       $2,070,352

NRLCA:   $1,258,708       $1,255, 141

NPMHU:    $429,575           $198,359

TOTAL:   $9,576,303       $8,931,740

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Union loses bid to block mail processing plant consolidations

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In case anyone missed it, (this particular FedLine correspondent was away when the decision came down), the Postal Regulatory Commission last week officially dismissed a union complaint seeking to block the U.S. Postal Service’s downsizing of its mail processing plant network.

The complaint, filed in June by the American Postal Workers Union, argued in part  that the Postal Service had first to receive an advisory opinion from the PRC on the proposed changes to first-class mail delivery standards that are accompanying the downsizing. But while that approach is “preferred,” it’s not mandatory, the five-member commission ruled in its 16-page order.

The decision is no surprise, given that the commission had earlier declined to issue an emergency  injunction to stop the first round of 46 plant consolidations from going forward. The Postal Service wrapped up that round last month and–as previously announced-is taking a breather for the rest of the year “to allow employees to fully focus on the processing and delivery of election mail and the volumes of mail expected during the busy fall and holiday mailing seasons,” a spokeswoman said in an email.

In all, the Postal Service plans to close or consolidate roughly half of its plants during the next two years. The agency currently has 433 processing facilities.


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Story of one mail processing plant consolidation reveals possible pitfalls

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The U.S. Postal Service plans to close or consolidate about half of its 461 mail processing facilities during the next two years or so. Judging from a newly released after-action review of one recent downsizing, a bumpy road lies ahead both for postal employees and customers.

The review, released today by the Postal Service’s inspector general, examines the consolidation of the Frederick, Md. Processing and Distribution Facility with the Baltimore Processing and Distribution Center between last October and January. Long story short: Service suffered and costs were higher than expected.

One big mistake was scheduling the move during the Christmas mailing season (what were USPS execs thinking?) and it didn’t help that a couple of key management positions went vacant around the same time, according to the report. Although service rebounded fairly quickly, one hopes the Postal Service picked up a few pointers on what not to do.

While we’re on the topic, incidentally, the first phase of the new consolidation push was supposed to get under way this week after the American Postal Workers Union failed to win an injunction from the Postal Regulatory Commission. The Postal Service plans to consolidate 48 plants by the end of next month. Everything then goes on hold through the end of the year, both to avoid disruption to mail balloting for the November election and–yes–this year’s holiday season.

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Rural letter carriers’ contract concessions follow APWU precedent

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When American Postal Workers Union members agreed to a contract last year that included wage and benefit concessions, they were obviously binding themselves for the life of the agreement with the U.S. Postal Service. Less obvious—at least to FedLine–was that they were also setting the stage for similar givebacks by other postal unions.

That’s a lot clearer now, however, with the award of the three-member arbitration board charged with setting the terms of a new contract between Postal Service and the National Rural Letter Carriers’ Association.

The APWU agreement “provided precedent that would have been very difficult to ignore,” wrote Joey Johnson, the board’s NRLCA-appointed member, who partially dissented from the final decision announced yesterday.

Just like the APWU contract, for example, the new agreement for the rural letter carriers includes creation of a two-tier wage system that will pay new career employees more than 10 percent less, according a USPS summary. The deal also means lower wages for new non-career rural carrier associates to the tune of more than 20 percent, the summary says. Rural letter carriers will also shoulder an increasing share of the cost of their health insurance premiums, exactly along the lines of the APWU contract.

It could have been worse, of course. The Postal Service apparently wanted deeper concessions than those agreed to by the APWU on the grounds that its financial condition had deteriorated since last year. That line of argument didn’t persuade the arbitration board’s chair, Jack Clarke. The big problem, Clarke wrote, is Congress’ failure “to address the overall mission and financing of the Service in a time of deteriorating mail volumes and reduced public demand for hard-copy postal services.”

The new contract does contain modest wage and cost-of-living adjustments. It also suggests what’s ahead for members of the National Association of Letter Carriers and the National Postal Mail Handlers Union, the other two postal unions whose contracts expired last November. Following the failure of negotiations with the Postal Service, both are proceeding with binding arbitration.


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Arbitrators to decide terms of three postal union contracts

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Now that the U.S. Postal Service and the National Postal Mail Handlers Union are officially arbitration-bound, it seems time for an overview of the state of USPS labor negotiations that will affect both the mail carrier’s bottom line, not to mention the incomes and working conditions of tens of thousands of postal workers.

More than a year has passed since members of the American Postal Workers Union ratified a new contract that will run through 2015. But the Postal Service has yet to sew up agreements with its other three bargaining units.

Its last contract with the National Rural Letter Carriers’ Association, for example, expired in November 2010; after the two sides couldn’t reach a successor deal, arbitration hearings wound up in April. NRLCA members are now waiting to hear the outcome from the three-member panel headed by neutral arbitrator Jack Clarke.

Contracts with the mail handlers union and the National Association of Letter Carriers both played out last November. After a failed bid at mediation earlier this year, the NALC announced a few weeks ago that Shyam Das will  chair the arbitration panel, with discussions under way to set a hearing schedule that could last several months. Last but not least, the mail handlers union announced last week that it’s also headed to arbitration after mediation also proved unsuccessful.

Both labor and management tend to be tight-lipped about the exact issues that lead to hangups in contract talks. There’s little doubt, however, that this round has been particularly arduous, as the Postal Service seeks to win cost-saving concessions.  The terms of last year’s APWU contract, for example, were such that the union’s immediate past president, William Burrus, opposed ratification.

In a posting on its web site last week, the mail handlers union suggested that one factor in the failure of mediation in its case was Congress’ slowness in acting on legislation “to support the long-term financial well-being of the Postal Service as an ongoing institution and government agency.”  In addition, “the status of the bargaining agreements for our three sister postal unions clearly could have an effect on what is already an exceedingly complicated process regarding the NPMHU-USPS contract dispute.”

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Postal Service processing plant closures in jeopardy

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Don’t look now, but a key piece of the U.S. Postal Service’s downsizing drive this year is at risk of getting smoked before it even gets started.

It’s the piece that involves closing or consolidating 48 mail processing plants in July and August. As part of that effort, the Postal Service is seeking a legally required advisory opinion from the Postal Regulatory Commission on a related proposal to revamp first-class mail delivery standards. The problem is that the commission doesn’t plan to issue that non-binding opinion until early September—after the downsizing is supposed to have been completed.

That doesn’t sit well with the American Postal Workers Union, which represents some processing plant employees. In a 29-page complaint filed last week, the union called on the PRC to bar the Postal Service from proceeding until the opinion comes out. The commission plans to rule on the APWU complaint by July 1, a spokeswoman said today, and its decision in that case will be binding.

Not surprisingly, Postal Service lawyers argue in a rebuttal today that the union doesn’t have a legal leg to stand on. But they acknowledge that even a short-term delay to the plant closings “will have real consequences.” That’s because the  Postal Service has already agreed to suspend any further closings from September through December to avoid disruption to mail balloting in this November’s elections or shipments during the lucrative holiday shopping season.

So, if the five-member commission effectively opts to bar any closings this summer, it will likely be game over for this year. While the Postal Service intends to resume the plant closings early next year,  a new implementation date would require “a significant overhaul to . . .  current operations plans, leading to even more expense to the Postal Service in terms of costs and resources,” the agency said in today’s filing.

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Postal Service offering mail handlers $15,000 buyouts

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It’s official: The U.S. Postal Service is dangling more employee buyouts.

The buyouts, available to most mail handlers, will amount to $15,000 total, payable in separate $7,500 installments this December and December 2013, according to a Thursday bulletin on a Postal Service web site. With a few exceptions, all career employees covered by the Postal Service’s national agreement with the National Postal Mail Handlers Union are eligible, the bulletin says. Full-time employees wanting to sign up must do so by July 2, and agree to leave or retire by Aug. 31. Part-time career mail handlers are eligible on a pro-rated basis tied to the number of hours worked in the preceding year. Part-timers have until July 16 to make a decision, but must also be out the door by the end of August.

A USPS spokesman could not be reached for comment Thursday night on how many employees would be eligible in all. Union President John Hegarty was also not available.  Last year, the NPMHU reported almost 39,000 regular members, according to a filing with the Labor Department.

The deal with the Postal Service “is intended to provide a financial cushion, and added peace of mind” for mail handlers wanting to move on, the NPMHU said in a separate statement on its web site.  At the American Postal Workers Union, which also represents some plant employees, a spokeswoman said earlier Thursday that the Postal Service had so far not extended a formal buyout offer for its members.

Confirmation of the new agreement with the mail handlers union comes a week after USPS executives said they would proceed with the closing or consolidation of 48 mail processing plants this summer as the first step in a historic downsizing that will eventually shrink the plant network by half and eliminate 28,000 jobs. The troubled mail carrier, which lost $6.5 billion in the first six months of fiscal 2012, is eager to cut costs by enticing workers to leave voluntarily. Earlier this month, the Postal Service offered $20,000 buyouts to some 21,000 postmasters under a separate plan to trim operating expenses at 13,000 post offices.

In 2009, the Postal Service had extended $15,000 incentives to employees represented by the NPMHU and the postal workers union in hopes of encouraging some 30,000 to leave. In that case, the payments were split into $10,000 the first year and $5,000 the second. Among workers not eligible for this latest offer are those on probation, along with any who are transferring to another federal agency, according to the Postal Service.

Federal Times had previously reported that buyouts were coming, but USPS officials refused last week to provide confirmation.

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Arbitration ahead for Postal Service and National Association of Letter Carriers

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Well, that didn’t take long. Less than a month after National Association of Letter Carriers President Fredric Rolando said the union was “committed” to reaching agreement on a new labor contract through mediation, it’s now headed to binding arbitration with the U.S. Postal Service, according to a release posted on a USPS site. The arbitration process will wrap up later this year, the Postal Service said.

A NALC spokesman had no immediate comment this morning.

The news comes three months after impasses were declared in the Postal Service’s negotiations with both the NALC and the National Postal Mail Handlers Union. Although the unions’ previous contracts officially expired in November, the terms remain in effect until new agreements are reached. After an impasse, the next step is normally mediation, followed by arbitration. Talks with the mail handlers union remain in mediation, according to the Postal Service.

Although both USPS and union negotiators are typically tight-lipped about the status of contract talks, there’s no question that the latest round has been exceptionally difficult. The National Rural Letter Carriers’ Association and the Postal Service are already in arbitration. Although the Postal Service clinched a new contract last year with the American Postal Workers Union, the final deal created a two-tier wage system that means new hires will make 10.2 percent less on average.

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