Regulators have no power to block mail plant closures, says USPS

The US Postal Service has urged regulators to reject a union attempt to derail its mail plant closure plan, which is set to begin in less than two weeks’ time. It said yesterday that the complaint filed by the American Postal Workers Union with the Postal Regulatory Commission last week “ignores the governing law”, and that the complaint was only “emergency” in nature because the union had waited until the “eleventh hour” to file it.

USPS also said the union’s complaint attempted to work the law “under the guise of its position as a mailer”, that the APWU was inappropriately suggesting it spoke for all mailers because it itself made use of the mail.

The Postal Service said the regulators did not have the authority to block its closure plans, and that any attempt to delay closures would harm the USPS finances.

USPS is intending to consolidate 48 mail processing plants in July and August, before a four-month moratorium on closures during the run-up to US elections and the festive season.

A further 92 plants are to be shuttered in January and February 2013 as the Postal Service seeks to shave $1.2bn off its annual operating expenses, limiting overnight First Class Mail delivery to a local service in the process. A second phase could also close more plants in 2014 if needed.

Review

The Postal Regulatory Commission has been reviewing the changes in mail standards associated with the mail plant consolidation plan since December 2011, but is not expected to produce its Advisory Opinion much before September.

However, while the review has been ongoing, USPS amended its closure plans, issuing a final rule at the end of May 2012.

Last week the APWU’s complaint suggested this amended plan had been filed too close to the start of consolidation on 1st July, and that there would not be a proper Advisory Opinion from the regulators produced regarding the service changes expected from next month.

The union claimed that without an Advisory Opinion, USPS would be breaking the law, which requires such regulatory reviews of postal policy changes affecting nationwide services, even if USPS is not legally required to comply with recommendations in the Advisory Opinions themselves.

Yesterday, the Postal Service argued that its request for an Advisory Opinion made on 5th December 2011 applied to its service standards taking effect on 1st July. It said since the request required an Advisory Opinion from the regulators within 90 days, it has been effectively free to implement its service standards since 5th March 2012.

USPS said APWU was wrong to claim it had to first obtain an Advisory Opinion before making nationwide service standards, suggesting the law requires it only to request an Opinion.

It said nothing prevented it from implementing its plans before the regulators completed their review.

Regarding the argument that it changed its plans to such an extent that it needed a new Advisory Opinion, USPS said the only real difference in the plans finalised in May 2012, compared to those proposed in December 2011, was in the two-phased timing of closures.

USPS said the Commission itself had stated that it would incorporate the modification of the consolidation plan within its original review process.

The Commission is expected to make a decision on the APWU complaint in the next two weeks.

APWU

[Updated 22 June] Following original publication of this story, the American Postal Workers Union filed papers warning that the Postal Service’s position effectively “neuters” the US postal regulator by suggesting it only ever needs to request Advisory Opinions, and not wait for Opinions to be produced before acting.

However, the union insisted: “Nothing in the Section 3661 (of the US postal law) or in the Commission’s regulations suggest that the Postal Service is entitled to act without a Commission opinion if it has filed its request 90 days before it intends to implement the proposed changes as the Postal Service contends.”

Arguing that the Postal Service could not simply act because the Commission took longer than 90 days to review proposals, the APWU pointed out that in the consolidation case, the Postal Service had not even provided the full details of its plans until May 2012.

The union also clarified that it was not calling for USPS to stop closing any mail plants until an Advisory Opinion was issued by the Commission, but that it should not make changes to its mail service standards until the review is complete.

“By its Motion, the APWU is seeking to preserve First Class Mail service standards until after the Commission has issued its Advisory Opinion in this case and the Postal Service has had an opportunity to consider that Opinion,” said the union.

“The Postal Service has not submitted any competent evidence to support its contention that the planned July 1 service standard changes are necessitated by the planned closure of 48 facilities.”