USPS agrees "tentative" 3.5% pay deal with union leaders

The US Postal Service has reached a “tentative” new four-and-a-half-year collective bargaining agreement with the American Postal Workers Union, it confirmed today. The deal still requires approval by the union’s 205,000-strong membership, which is expected to come within the next two months.

Set to run through May 20, 2015, the deal gives the USPS some room to control its labour costs, the Postal Service said.

It is based on a 3.5% wage increase over the life of the contract, with a first 1% raise taking effect in November 2012, followed by a 1.5% increase the following year and a 1% increase from November 2014.

The union said the deal retained cost-of-living allowances, although payments for 2011 will be waived and payments for 2012 deferred to 2013 to help with USPS cashflow.

Changes to wages will be made for new employees, who will start on lower salaries, but the union said it had managed to secure an agreement on returning outsourced work to its members and limiting long-distance reassignment of workers (excessing).

On outsourcing, the union said it also had an agreement that if APWU members can perform work at a lower price than other subcontractors, work must be performed by the union members.

The union also said it had agreed protection against layoffs for all career employees on the rolls as of November 20, 2010.


The USPS is seeking to trim its budgets dramatically given that it is currently on track to run out of cash this September, as its multi-billion dollar losses run into its $15bn legal limit on government borrowing.

Commenting on the new labour deal with the APWU, the Postal Service said reasonable wages and benefits would be “critical” to helping it meet its financial obligations and remain strong in the future.

“This is a responsible agreement that is in the best interest of our employees, our customers and the future of the Postal Service,” said Postmaster General Pat Donahoe. “The contract will help lay a foundation that is fair to our employees and stakeholders.”

The APWU represents USPS employees including clerks, mechanics, vehicle drivers, custodians and some administrative staff.

The union’s leadership said today that the “severe” financial state of the Postal Service had required some “very creative” negotiation.

But APWU President Cliff Guffey insisted that the deal reached on Monday did accomplish the union’s goals to protect jobs while strengthening the Postal Service.

“I am hopeful and remain confident that both the committee and members of the union will endorse the agreement,” Guffey said this afternoon.

“With workers across the country fighting to defend their right to collective bargaining, our tentative agreement is a testament to the value of a great American freedom – the right of workers to have a voice at work and to negotiate for a better life.”


Along with the National Rural Letter Carriers’ Association, the Postal Service began negotiations for a new collective bargaining agreement last year, with the last contract running out in November 2010, when negotiations with the NRLCA ground to a halt.

The USPS said talks with the NRLCA, which represents 67,000 career employees and 48,000 non-career employees who generally work delivering mail to rural and suburban addresses, are still to be settled by arbitration.

The employees of both the NRLCA and APWU received more than $20 billion in wages in benefits last year, the USPS said.

Two other postal unions, the National Association of Letter Carriers and the National Postal Mail Handlers Union, are set to begin negotiations for their next collective bargaining agreements towards the end of August.

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