Issa orders hearing into “missed opportunity” USPS union deal
House Republicans in the US Congress have expressed “serious doubts” about a new labour agreement between the US Postal Service and the American Postal Workers Union. The deal on the 2010-2015 collective bargaining agreement was reached last week, after months of negotiation with the union leadership, and still requires the union members to ratify it.
A postal ballot is due to be held from next month, with votes to be counted May 11.
The agreement was based on a 3.5% increase in wages, deferred a year along with cost-of-living allowances to help the Postal Service with its cash flow problems.
But while left-wing critics have suggested the deal gives too much to the USPS management, particularly in terms of wage cuts for new workers and reduced healthcare contributions, Republican Congressman Darrell Issa said today he believed it did not do enough to help the Postal Service improve its financial situation.
The Congressman from California has announced a full hearing is to take place next month in front of the House Oversight and Government Reform Committee, which he chairs, for both the USPS and APWU to explain the agreement.
He said 80% of the Postal Service operating expenses were workforce-related, and that costs had to be cut to cope with falling mail volumes and projections of declining revenues at the USPS.
“The union contract renewals are the best chance to find new savings,” said Issa. “Unfortunately, this looks like a missed opportunity. The Postal Service must show Congress and the American people that it can pay its own way, because the numbers do not seem to add up.”
“Baseline”
Issa added that his hearing, scheduled for April 5, would seek to lay out an “important baseline” for forthcoming Congressional action to tackle the Postal Service’s structure, finances and self-governance.
The Postal Service is currently pushing Congress to make changes to help it reduce multi-billion dollar annual losses, and become a more flexible, efficient organisation. The USPS is facing the possibility of defaulting on its healthcare payments to the federal government this September, if changes are not made by Congress to its obligations.
Speaking this week at the Washington DC legislative seminar of the National Association of Postal Supervisors, the US Postmaster General Pat Donahoe said: “Time is not on anyone’s side at this point.”
Other Republicans on Issa’s committee have echoed their chairman’s concerns about the Postal Service wage bill, with Florida Representative Dennis Ross, who chairs the committee’s Postal Service subcommittee, suggesting that the USPS is paying its workers a significant premium above private sector levels.
Ross backed his concerns with figures taken from testimony given to the President’s Commission on the Postal Service back in 2003 by corporate finance expert Michael Wachter, who has consulted for the USPS since 1980.
Ross said today: “The Postal Service cannot afford to continue to pay, as their own numbers have estimated, a 34.2% wage premium over comparable private sector labor.”
