GAO says USPS should add delivery indicators to Pay for Performance
In response to a request by the Senate Committee on Homeland Security and Governmental Affairs Committee, the Government Accountability Office (GAO), has suggested changes to the USPS Pay for Performance program, or PFP. PFP determines the annual salary increase for EAS and PCES managers, who do not receive the cost of living and “step” increases added to bargaining unit employees salaries.
The GAO’s key recommendation was that the USPS add new delivery performance indicators to PFP, since the existing delivery indicators (EXFC, etc.), “apply to less than one-fifth of mail volume”.
The GAO found that in the existing PFP program
Corporate and unit indicators related to three strategic goals in USPS’s updated Strategic Transformation Plan3—increasing efficiency, improving service, and generating revenues—collectively account for two-thirds of the average participant’s rating. More specifically, results for efficiency-related indicators, such as USPS’s overall productivity and unit expenses, account for 27 percent of the average participant’s PFP rating; results for service-related indicators, such as the timeliness of delivery for certain types of mail, represent 22 percent of the average rating; and results for revenue-generation indicators, such as national and unit revenues, account for 17 percent of the average rating. However, the weight of PFP indicators varies considerably by participant group, based on the responsibilities and spans of control of various managerial and executive positions.
The report noted that
USPS is in the process of implementing required measurement of delivery performance for market-dominant mail, including new delivery performance measurement systems for mail that is not being measured—such as Standard Mail, bulk First-Class Mail, and Periodicals.4 Together, these three mail types constitute 78 percent of mail volume, including 49 percent for Standard Mail, 25 percent for bulk First-Class Mail, and 4 percent for Periodicals. USPS has recognized that the successful implementation of these new measurement systems will depend, in part, on actions by mailers. USPS expects these actions—including barcoding mail and containers, as well as providing electronic information on mailings—to become more widespread over the next several years. Once the new delivery performance measurement systems are fully implemented and mailers’ participation is sufficient to generate representative data, USPS will have the opportunity to incorporate new delivery performance indicators into its PFP program.
The report also included charts showing the average annual salary increases or lump sum payments earned by participants since the program began in 2003. (Employees whose salary increase would exceed the upper limit of their salary range receive a lump sum payment.) Interestingly, although the goals for executives on the one hand, and managers and supervisors on the other are drawn from the same basket of indicators, executives receive far higher PFP payments. In the first year, 2003, PCES excutives received an average PFP payment (combining increases and lump sums) of 12.7%, while lower level managers and supervisors received 6.5%. Last year, the average PFP for executives was 7.9%, for managers and supervisors 5.2%.
Average Annual PFP Increases for PCES executives
Average annual PFP increases for EAS managers and supervisors
GAO: New Delivery Performance Measures Could Enhance Managers’ Pay for Performance Program
