The Postal Service will cut its labor costs by $3.6 billion over the next four-and-a-half years under a tentative contract agreement it reached last month with one of its largest unions, Postmaster General Patrick Donahoe said Monday.
Donahoe, speaking to reporters in advance of a Tuesday hearing called by lawmakers to scrutinize the labor agreement, said the contract with the American Postal Workers' Union represented a responsible way forward for USPS, and was the latest example of a 10-year effort to cut its workforce and its costs in the face of declining revenues.
Leaders of the House Committee on Oversight and Government Reform criticized the deal shortly after it was announced. Committee chairman Darrell Issa (R-Calif.) said he doubted that the contract would improve USPS's bleak fiscal situation.
"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," Issa said in a statement.
Donahoe said he was prepared to defend the deal when he testifies Tuesday morning. "We have reduced the career-paid headcount by 30 percent since 2000," he said. "We've taken 240 million work hours out of the system. If we did not have to prepay retiree health benefits like nobody else in the world did with a 20 percent downturn, we would have had $611 million in profit."
Instead, the Postal Service, with current-year costs of $73 billion, projects it will lose $6.4 billion in 2011 and reach its statutory debt limit of $15 billion later this year. Donahoe said USPS needs to bring its costs down to $60 billion in order to return to profitability and begin to pay down its debt.
USPS and APWU say the deal achieves the savings through a 5 percent reduction in health care costs, which are being shifted to workers, a freeze on cost of living adjustments, and the creation of new, non-career flexible positions that will start new employees at lower salaries.
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2 comments:
a good samaritan brought me my daughters tax refund check to my house. he lived four blocks away in another neighborhood and found it laying in the street, Yeah these postal workers are definately not paid enough and very overworked! just another government welfare to work program!
Darrell Issa, a Senator, has the AUDACITY to talk about how "the numbers don't add up?" Him, and 99 other idiots, have been approving --- APPROVING --- budgets that even a kindergartner could see "don't add up"...did his math skills just take an astronomical leap, or is he just another goof trying to act like he is "concerned" about where the money is coming from, or going to....Mr Issa, please shut up and go back to taking bribes, catering to special interests, violating the Bill of Rights, exempting you and the other 99 idiots from the laws you pass for the rest of us, and taking a full-time paycheck for part-time work (and accomplishing very little).
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