WASHINGTON – The nation’s postal unions and the U.S. Postal Service’s management have collided over management’s latest plan to close what it says is a yawning deficit: mass layoffs, violating union contracts, and cuts in health care.
“I am at a loss for adjectives sufficient to the task of describing these actions by the postal service. Several that come close are outrageous, illegal and despicable,” Postal Workers President Cliff Guffey told a contentious Senate Governmental Affairs Committee hearing on Sept. 6.
The confrontation will continue: Postal unions plan a National Day of Action Sept. 27 to alert the public about the Postal Service’s schemes.
APWU and the other postal unions, including the National Association of Letter Carriers and the Mail Handlers, a sector of the Laborers, oppose the USPS plan to abrogate its union contracts and unilaterally fire 120,000 career workers.
Guffey noted the postal service already has the power to cut employee costs by making up to 20 percent of its workforce low-paid no-benefit temps. USPS also expects 100,000 veterans to retire.
The unions also oppose the agency’s plan to withdraw the nation’s half a million postal workers from the federal employees’ health care plan – a plan that, due to its huge size, is very cost-effective while providing a wide range of health care choices.
The other unions also oppose the postal service’s schemes, which Postmaster General Patrick Donahoe claims are needed to prevent the semi-independent agency from running out of cash and exhausting its $15 billion line of credit.
Letter Carriers President Fredric Rolando tangled with Donahoe on PBS’s Newshour. Rolando said most of the projected $8 billion-$9 billion loss USPS faces in the year ending Sept. 30 comes because a 2006 law requires it to prepay future health benefit costs for present workers – a $5.5 billion expense per year for a decade.
“Any business would not put $20 billion in cash into future pre-funding” of the health care costs, as USPS has been forced to do since 2006, Rolando said. And no business “would be forced to leave $50 billion-$75 billion in excess payments in its pension account,” again as the 2006 Bush-pushed law forces USPS to do, he added.
News reports say the Obama administration plans to offer proposals to close the USPS budget gap, when it sends its recommendations to the 12-person congressional budget deficit-cutting committee. In the interim, it intends to ask lawmakers for a 3-month stay on the latest $5.5 billion health care payment, due at the end of September.
That’s not enough for Donahoe. Though he too says requiring pre-payment of the health care costs is ridiculous, he wants to cut the workers, anyway. That would force Congress to override union contracts, both the one Donahoe just signed with APWU and the others now being negotiated with the Letter Carriers and others.
“Current agreements prevent the Postal Service from moving swiftly enough to achieve these workforce reductions,” Donahoe said. “Our proposal would address collective bargaining prohibitions against layoffs and allow the Postal Service to make these difficult, but absolutely necessary, personnel moves, in order to remain viable.
“Development and submission of these plans illustrates the Postal Service’s commitment to consider a wide range of options and solutions to our ongoing financial difficulties. Although there is disagreement with some of the proposals, the Postal Service is willing to put everything and anything on the table for discussion,” he added.
The Postal Service also wants to close 3,700 post offices, consolidate distribution centers, eliminate Saturday delivery and allow first-class letters to get to their destinations within two or three days, not one or two. First class mail is the most-profitable mail for the Postal Service. Bulk mail runs at a large loss, figures show.
Guffey did not comment on the closings but he said cutting the workers and the service would actually cost USPS money as well as people.
“APWU will oppose with every resource at our disposal any effort to destroy our health benefits program, to lay us off and replace us with temporary workers, or to undermine our retirement. And make no mistake about it, the layoff of 120,000 postal employees would hit all postal workers, including veterans. Whenever the Postal Service closes a whole plant, as they have said they want to do, all the employees in that plant, would be subject to being laid off,” he added.
And a top Letter Carriers official, attending an international conference of postal unions (UNI) in D.C., said his union is also pushing to give USPS greater flexibility in setting rates. That would let it raise rates on money-losing third-class bulk mail.
The U.S. postal unions also drew international postal union support. UNI General Secretary Philip Jennings told Press Associates the U.S. unions are correct to lobby about the health care payments and against the personnel cuts. And USPS should be thinking of ways to expand its service and bring in more revenue – such as reopening a postal savings bank or becoming the lead agency for foreign workers’ remittances to their home countries – he added.