The United State Postal Service (USPS) wants to cut 120,000 jobs from its workforce and pull out of the federal health and retirement benefit plans. The postal service would have to break labor agreements in order to reduce its workforce by 20 percent and claims that it would be able to provide benefits to workers at a lower cost through the private sector. In order to make such wide-sweeping changes -- and break collective bargaining agreements -- the U.S. Postal Serivce will have to get Congress to sign off the plan.
In a document to workers, USPS cited "significant declines in mail volume and retiree health benefit pre-funding costs imposed by Congress" as reasons for the proposal that would break collective bargaining agreements made with their workers' unions. In a "Workforce Optimization" paper Obtained by the Washingtion Post, the postal service recognized the "extraordinary request" it was making of Congress in asking the legislative body to give the nod to a plan that would sever several collective bargaining agreements with labor unions, but explained it away with this:
However, exceptional circumstances require exceptional remedies. The Postal Service is facing dire economic challenges that threaten its very existence. . . . If the Postal Service was a private sector business, it would have filed for bankruptcy and utilized the reorganization process to restructure its labor agreements to reflect the new financial reality.
Union leaders balked at the proposal, saying they "vehemetly oppose the idea" and that their "advisors are not encouraging us at all to even consider it," reports the Washington Post.
“The issues of lay-off protection and health benefits are specifically covered by our contract. . . . The Congress of the United States does not engage in contract negotiations with unions, and we do not believe they are about to do so,” Fredric V. Rolando, president of the National Association of Letter Carriers, told the paper.
In addition to reducing the workforce by 120,000 by 2015, plus an additional 100,000 by attrition, the postal service prepared a white paper on health benefits and pensions in which it stated that it would like to move "its 480,000 pensioners and 600,000 active employees from the Federal Employees Health Benefits Program 'and place them in a new, Postal Service administered' program," according to the Post's report. The plan is apparently the same for retirement benefits as well. USPS argues that the current plans "do not meet 'the private sector comparability standard,'", which is "a statement that could be translated as meaning that government plans are too generous and too costly," the report explains.
USPS has already seen the loss of 212,000 jobs over the last decade and the service recently announced potential plans to close some 3,700 postal offices.