The deal running through to 20 May, 2016, includes a 1% wage increase in November 2013, 1.5% increase the following year and a 1% increase in November 2015.

There are also seven cost-of-living adjustments up to 2016, with those for 2013 deferred to 2014.

Nevertheless, the Postal Service issued a statement on Friday saying it was “disappointed” with the contract, in continuing to provide layoff protection for NALC’s 192,000 mainly urban-based letter carriers.

USPS did not get its wish for a wage freeze and the elimination of cost-of-living adjustments, and had also wanted more flexibility to outsource work and use non-career workers.

“While the decision by the arbitrator includes important and substantial cost-savings provisions that will benefit the Postal Service over the life of the contract and into the future, it does not include all of the changes we sought,” said USPS.

“We are disappointed the Award continued limited no layoff protection and restrictions to contracting out.”

USPS and NALC have been negotiating a new labour deal since the last contract ran out in November 2011. Arbitration began last April, with the deal reached for 2011 to 2016 being the first NALC contract to go to arbitration since the 1998-2001 contract.

The arbitration panel included a representative from USPS – the Postal Service counsel Robert Dufrek – and one from NALC, the union’s general counsel Bruce Simon, along with an independent arbitrator, American Arbitration Association member Shyam Das.

“Win-win”

NALC said its negotiators had worked hard to create a “win-win” bargaining position, and said that ideally agreement would have come through a negotiated settlement.

But NALC president Frederic Rolando said on Friday that the deal reached by the panel met all of the union’s primary objectives for negotiation.

“NALC had three primary objectives in this critical round of collective bargaining. First, to protect the jobs and living standards and working conditions of the nation’s 180,000 letter carriers. Second, to protect the integrity of our historic institution-the United States Postal Service. And third, to work cooperatively with all stakeholders to enable the USPS to continue to serve the American public, in the internet age, by strengthening our unequalled last mile ‘delivery’ capacity. This agreement meets all three of those objectives,” he said.

With labour representing 80% of its $66bn annual operating expenses, USPS has been keen to find ways to improve the flexibility of its work force, allowing more use of part-time and outsourced resources and reconfiguring healthcare arrangements.

The Postal Service is also looking to downsize its workforce from the current 546,000 towards 400,000 as the company shrinks its network to respond to the 25% cut in mail volumes over the last six years.

The arbitration deal does allow up to 15% of full-time carriers in each district to be non-career “city carrier assistants”, who will be first in line for full-time vacancies and eligible for health insurance after one year. It also reduces USPS contributions to healthcare premiums from 80% in 2012 to 76% by 2016.

But NALC won a continuation of the 2006 ban on subcontracting for the delivery of competitive products, while it also secured the no-layoff clause for carriers with at least six years of service.

The Postal Service said on Friday that the way the arbitration deal turned out put added pressure on Congress to reform its operational cost structure. One aspect that was floated last year in postal reform proposals – certainly by the Republican side of the Hill – were potential measures allowing USPS to break union agreements requiring layoff protection.

“Congress needs to enact significant legislative reform to quickly restore the Postal Service to profitability and put the organisation on stable, long-term financial footing,” the Postal Service said.

Source: Post&Parcel/NALC/USPS

Tags: collective bargaining agreement, Congress, NALC, Union, USPS