USPS Continues Its Cost-Cutting Moves
WASHINGTON — In a decision to save hundreds of millions of dollars in labor-related costs, the U.S. Postal Service negotiated an agreement with two of its employee unions to offer select employees a financial incentive to retire or resign before the end of the fiscal year.
The one-time offer is a strategic move to accelerate targeted staffing reductions for employees represented by either the American Postal Workers Union (APWU) or the National Postal Mail Handlers Union (NPMHU).
Advances in mail processing technology and the continuing recession have led the Postal Service to more aggressively match work hours with work load. The majority of employees eligible for the incentive work in mail processing facilities.
Because the number of addresses grows by 1.5 million each year, letter carriers represented by the National Association of Letter Carriers and the National Rural Letter Carriers’ Association were not extended this offer.
The incentive provides eligible employees $10,000 to be paid during the first three months of Fiscal Year 2010, creating salary and benefit savings for the next nine months. The same employees will receive a second payment of $5,000 in Fiscal Year 2011. Fiscal Year 2010 starts Oct. 1, 2009.
As many as 30,000 employees could take advantage of the incentive offer. Savings to the Postal Service could be as much as $500 million next year.
The employee incentive offer is the latest in a series of cost reductions the Postal Service has made this year. Cost savings during 2009 are expected to total more than $6 billion, including the following actions:
