Here we go again- the USPS has file its February financial results, and the headlines will read “USPS loses $1 billion in one month!”, and once again congressional tongues will cluck about a “failed business model” and “bloated bureaucracy”. The true story, of course, is very different. When you measure costs that the US Postal Service actually controls, including current payments for retiree pensions and health benefits, the USPS lost far less- $230 million. For the fiscal year to date, the USPS is actually still in the black by $18 million. What makes the financial picture look so bad is, as usual, the $5.5 billion annual charge Congress slapped on to the USPS budget in the 2006 PAEA law. For February, that adds $458 million to the postal service’s expenses. Another mandate, the “non-cash” adjustment for the future value of workers comp charges, adds another $406 million, pushing the month’s “loss” to over a billion. And just to show how bizarre postal accounting has become, the year to date workers comp non-cash adjustment actually has a positive impact on the budget of almost half a billion dollars.

Confused? You should be.

Looking past the phony charges and “non-cash” adjustments presents a more positive picture, but there are still troubling numbers in the report. Total mail volume declined 1.5% from the same period last year (SPLY). At the same time, total employee workhours dropped by 3%- so the USPS did a good job adjusting hours to match volume. Unfortunately that didn’t translate into dollars and cents. Total revenue, like total volume, dropped by 1.5%. But postal workers’ salaries and benefits dropped by just 0.6% for the month, and non-personnel costs- fuel, supplies and services, etc., actually increased by 2.4%. As a result, while revenue was down by 1.5%, expenses actually went up by just under one percent.

Standard mail continued to account for the majority of mail volume, and even showed some slight growth, up by 0.4% over SPLY, but First Class mail was down by 3%. And the fact remains that standard mail produces roughly half the revenue per piece as First Class.

So even without “trust funds” and “non-cash adjustments”, the USPS has serious concerns. It’s unfortunate that the politicians responsible for much of the service’s problems seem less interested in addressing those real concerns than in finding opportunities to use the word “BAILOUT” as often as possible. Read the rest of this entry »

COLUMBUS – A task force created by the Ohio Bureau of Workers’ Compensation (BWC) Special Investigations Department (SID) in collaboration with the US Postal Service Office of Inspector General (USPS OIG) has uncovered workers’ compensation fraud at six businesses that contract with the Postal Service. The task force was created in 2009 to address a trend among contractors of failing to maintain workers’ compensation coverage despite being paid to do so by the Postal Service. Read the rest of this entry »

In a televised discussion of the financial challenges facing the USPS, APWU President Cliff Guffey defended the union’s Tentative Agreement for a new contract with the Postal Service and reminded viewers the nation’s mail system “is the backbone of a multi-trillion dollar business in this country.“

Guffey appeared in an interview today on CNBC’s “Squawk on the Street” segment about the viability of the USPS.

The union president said the recently negotiated Tentative Agreement benefits both parties by preserving jobs, providing for more flexible work hours, and bringing work back in-house to reduce profiteering by USPS contractors.

Guffey also reminded viewers that the Postal Service’s financial problems are largely caused by Congress, which in 2006 began using the USPS as a “cash cow” to drain revenue from the mail system, and by the severe economic recession.

The union president faced off against a representative from Citizens Against Government Waste, who charged that the USPS must close facilities and that it failed to address its “workforce problem” in agreeing to a new contract with the APWU. (CAGW is a self-styled “watch dog” group that favors privatizing the Postal Service and is funded by oil and tobacco companies and conservative foundations.)

via Guffey Defends USPS Viability, Tentative Contract Agreement on CNBC.

The Washington Post claimed again this morning that the USPS was planning to lay off “thousands” of postmasters and supervisors. This afternoon, in a telephone conversation with NAPUS National President Bob Rapoza, the PMG categorically denied the Post story:

NAPUS National President Bob Rapoza called Postmaster General Patrick Donahoe this morning in response to a March 25, 2011 article in the Washington Post, which stated the Postal Service planned to “eliminate the jobs of thousands of postmasters and supervisors, many through layoffs.” Postmaster General Donahoe told President Rapoza that he could tell Postmasters that “there will be no layoffs for Postmasters.”

The Washington Post article, which quoted postal officials about the Postal Service’s reorganization, generated many calls and emails to the NAPUS national office concerning the possibility of layoffs for Postmasters. Early this morning, the NAPUS President placed a call to the PMG, who later returned the call to Rapoza telling him that Postmasters will not be laid off.

The NAPUS national office has also been inundated with calls and emails, asking why Postmasters weren’t included in the Voluntary Early Retirement (VER) and incentive offers that were announced for USPS Headquarters, Area and District EAS Non-Bargaining employees. The reason Postmasters were not included in the VER and incentive offers is because post offices weren’t eliminated in the recent downsizing effort, thus Postmasters were not impacted employees.

Area positions (originally 1,123) are being reduced by 27.3% which equates to a job loss of 306 positions leaving a total of 817 area positions.

District positions (originally 5,791) are being reduced by 24.92% which equates to a reduction of 1,443 jobs, leaving a total of 4,348 district positions.

That is a total of 1,749 jobs down from the previous 6,914

While post offices have not been specifically targeted for closing during this initial downsizing effort, plans to close post offices are part of the overall reorganization process. NAPUS will continue to keep you informed on any information that Postal Headquarters provides concerning planned closings of post offices. The PMG reiterated his commitment to continue open communications with NAPUS, with “no hidden agenda.” He told President Bob Rapoza that he could quote him that “there will be no layoffs for Postmasters.”

via NAPUS.

The National Association of Postal Supervisors has issued a document containing information and advice for supervisors and managers affected by the USPS restructuring: Read the rest of this entry »

In a letter to Postal Regulatory Chairman Ruth Goldway, Gamefly CEO David Hodess has asked the PRC to expedite its consideration of Gamefly’s appeal against the USPS’s alleged discrimination against the company. Gamefly, which rents game DVDs by mail, claims that the USPS gives preferential treatment to Netflix:

I am writing to you to request that the Commission do what it can to expedite its decision in the GameFly complaint proceeding. GameFly frled this complaint nearly two years ago. Before that, GameFly spent 18 months working with the Postal Service in an attempt to resolve informally the issues on which the complaint was based.

I understand that the Commission has competing demands on its resources. Delay in resolving the case, however, is costly to GameFly. At the company’s current volume of approximately 1.2 million shipments per month, the difference between the two-ounce flats rate of $1.05 that GameFly must pay to avoid automated letter processing for most of its DVD mailers, and the one-ounce letter rate of $0.44 that Netflix pays to avoid automated letter processing of return mailers, amounts to about $730,000. This amount represents more than 100% of GameFly’s monthly net income in 2011.

Respectfully submitted,
David Hodess
President and CEO

NASHVILLE, Tenn. – The U.S. Department of Labor’s Occupational Safety and Health Administration has cited the U.S. Postal Service on Royal Parkway in Nashville with a repeat safety violation following an employee being struck by a mail cart. The proposed penalty totals $50,000.

In December 2010, an industrial powered tug with defective brakes hit a mail cart, which in turn struck a worker. The Postal Service is being cited with one repeat safety violation for exposing workers to being struck by powered industrial trucks when power tugs were not removed from service after being identified with damaged or defective parts.

OSHA has cited other Postal Service facilities for the same violation as recently as July 2010. A repeat violation exists when an employer previously has been cited for the same or a similar violation of a standard, regulation, rule or order at any other facility in federal enforcement states within the last five years.

"Using equipment that is not in proper working condition, especially defective brakes, is dangerous and that equipment should be removed from service," said William Cochran, director of OSHA’s Nashville Area Office. "Such hazards must be addressed and corrected, and OSHA will not tolerate this type of disregard for employees’ safety and health."

Separately, the Royal Parkway location was cited for a willful violation in February 2011 involving use of damaged or unrepaired dock levelers, and the Postal Service is currently contesting that citation.

The Postal Service has 15 business days from receipt of the latest citation and proposed penalty to comply, request an informal conference with OSHA’s area director or contest the findings before the independent Occupational Safety and Health Review Commission.

The site was inspected by staff from OSHA’s Nashville Area Office, 51 Century Blvd., Suite 340, Nashville, TN 37214; telephone 615-232-3803. To report workplace incidents, fatalities or situations posing imminent danger to workers, call the agency’s toll-free hotline at 800-321-OSHA (6742).

Under the Occupational Safety and Health Act of 1970, employers are responsible for providing safe and healthful workplaces for their employees. OSHA’s role is to ensure these conditions for America’s working men and women by setting and enforcing standards, and providing training, education and assistance. For more information, visit http://www.osha.gov.

via 2011 – 03/24/2011 – US Department of Labor’s OSHA cites US Postal Service in Nashville, Tenn., with $50,000 fine for repeat safety hazard.

If you have problems with the Scribd version, click here to download the .pdf file. Read the rest of this entry »

Washington, DC – The Postal Regulatory Commission today released an Advisory Opinion on the U.S. Postal Service five-day delivery plan. The Postal Service must obtain a Commission Advisory Opinion on any change in nationwide service it proposes. The Opinion found annual net savings to be an estimate is $1.7 billion versus the Postal Service’s savings estimate of $3.1 billion among other discrepancies

Senator Susan Collins, the Ranking Member of Senate Committee that oversees the Postal Service, issued the following statement.

"The PRC found that the Postal Service’s estimate of savings was inflated and points out that ending Saturday delivery would delay approximately a quarter of first class and priority mail. While cutting service would save the Postal Service money, it would also drive down the mail volume that is critical to maintaining its solvency.

"Moreover, the PRC exposes the Postal Service’s failure to even consider the likely harm to rural postal customers. Echoing my warnings, PRC Chairman Ruth Goldway acknowledged in her addendum to the Opinion that five-day delivery would ‘unfairly discriminate’ against rural postal customers. The Advisory Opinion raises many of the same questions that I have posed over and over. These consequences simply must be addressed before consideration of such a significant service reduction."

In February, Senator Collins introduced legislation to help the Postal Service regain its financial footing as it adapts to the era of increasingly digital communications. The "U.S. Postal Service Improvements Act of 2011" would help the USPS achieve financial stability and future cost savings without undermining customer service.

Although postal officials haven’t publicly used the word, the Washington Post reports today that the US Postal Service expects to layoff “many”, perhaps thousands, of postmasters and supervisors if it doesn’t get enough of them to take early retirement. The story says the USPS expects the early retirement offer to be accepted by about 3,000 employees. The remainder of the 7,500 in staffing reductions would come by way of layoffs, the paper claims. The story contradicts what the Post says it was told by the PMG in January, when he said reductions would be made by attrition.

Once buyout decisions aimed at administrative staff are final in April, the agency plans to eliminate the jobs of thousands of postmasters and supervisors, many through layoffs, officials said.

“Nobody did anything wrong, but we’re a victim of the economy and past legislation,” said Anthony Vegliante, the Postal Service’s chief human resources officer and executive vice president…

Vegliante said he expects about 3,000 administrators to take the buyouts… Layoffs will then be used to help reach the 7,500 goal, he said, though he would not commit to a number.

via U.S. Postal Service announces sweeping job cuts, district office closures – The Washington Post.