USPS, postal union agree on retirement incentives

By Bernie Becker - 10/01/12 09:49 PM ET

The Postal Service and one of its largest unions have agreed to offer retirement incentives to a wide swath of postal employees.

The American Postal Workers Union said in a Monday statement that full-time career employees could receive $15,000, in two separate installments, under the agreement.

“Our goal was to achieve an incentive for members who are ready to end their postal careers; to ensure that no groups of employees are excluded, and to lessen the hardships of excessing for those who remain,” Cliff Guffey, the president of APWU, said in a statement. “This agreement accomplishes those objectives.”

Employees who accept the buyout – who must have at least 20 years tenure at 50 years old, or have worked at least 25 years – would leave USPS at the end of January 2013.

They would receive $10,000 in May 2013, and then the last $5,000 in May 2014.

The agreement between USPS and APWU comes after months of negotiations, and marks just the latest example of the cash-strapped Postal Service using buyouts to try and cut costs.

USPS already this year offered a deal similar to the APWU agreement to thousands of mail handlers, as it tries to cut $22.5 billion from its annual budget by 2016. The Postal Service lost more than $5 billion in the third quarter of fiscal 2012, and recently defaulted on a payment to the Treasury for the second time in two months.

The deal also comes as USPS officials – and lawmakers – continue to hope that Congress can craft a broad overhaul of postal operations before the end of the year. Democrats and Republicans in Congress generally agree that USPS could thin out its ranks of employees.

But while the Senate passed a bipartisan postal bill in April, the House has yet to act on a GOP bill that passed out of the Oversight Committee almost a year ago.

Sen. Tom Carper (D-Del.) and Rep. Elijah Cummings (D-Md.) on Monday both praised the USPS agreement with APWU while also continuing to chide House Republicans for failing to act on postal reform.

“It shouldn’t come as a surprise that the Postal Service is moving forward to reduce costs with the limited tools at its disposal,” Carper, one of the authors of the Senate postal bill, said in a statement.

“This latest cost-cutting measure by the Postal Service is substantial and takes similar steps to those outlined in the Senate bill to reduce the postal workforce, but the reality is that efforts of this scale are not enough to fundamentally fix the Postal Service’s financial problems.”

But House Republicans weren’t so quick to get behind the deal, even as they have urged USPS to make better use of the cost-cutting abilities they already have.

“Sixty percent of APWU’s workforce is eligible to retire,” Ali Ahmad, a spokesman for the House Oversight panel, said in a statement.

“Until we see whether this agreement actually leads to retirements from workers who weren’t going to retire anyway, it’s premature to assess the impact it will have on USPS’s financial situation.”