Congress and the Bush administration are poised to take a hard look at the pension and retirement health care benefits that would be provided to 800,000 employees of the U.S. Postal Service.
The benefits review was sparked by a White House commission report that said the Postal Service and its unions should be able to bargain over pension and retiree health care benefits. The commission broached the idea of allowing the post office to pull out of the civil service retirement trust fund and the Federal Employees Health Benefits Program as a way to better control long-term costs and liabilities.
Sens. Susan Collins (R-Maine) and Thomas R. Carper (D-Del.) have asked the Postal Service and the Office of Personnel Management to study the workforce-related recommendations made by the White House commission and issue reports by March 1.
"The question of whether benefits for Postal Service employees should be subject to the collective bargaining process requires careful review," Collins and Carper said in a Jan. 9 letter to OPM. "This recommendation raises important public policy and implementation issues whose resolution could have important effects on the postal and federal workforce."
If the Postal Service withdrew from FEHBP and the civil service retirement fund, nonpostal employees might have to pick up a bigger share of costs. Postal employees, meanwhile, could be asked to pay more toward their benefits or could find that it takes longer to become eligible for health and retirement benefits.
In its report last year, President Bush's postal commission portrayed the employee benefits at the post office as generous.
The commission said health care and retirement benefits accounted for about $20 billion of the $51.5 billion that the Postal Service spent on its employees in fiscal 2002. "A lack of negotiating authority with respect to these costs would be intolerable to most private-sector companies," the commission said. "They should be brought within the collective bargaining process at the business-oriented Postal Service, as well."
Some Hill aides and postal officials also think it is time to take a look at another benefit: workers' compensation. The Postal Service has about 13,400 disabled employees receiving workers' comp; 2,819 of those are totally disabled and will never return to work. Employees on the rolls are not required to retire when they become eligible, and many choose to stay on workers' comp until they die. The program provides either two-thirds or three-quarters of a person's salary tax free, which is more than most would receive in retirement benefits.
According to Postal Service data, 81 of the 2,819 disabled employees have received workers' compensation for 40 to 50 years; 778 for 30 to 39 years; and 1,185 for 20 to 29 years.
There are 382 recipients who are 85 or older, and 1,039 are 75 to 84 years old, the data show. A postal spokesman said a 96-year-old is receiving workers' compensation, and the 102-year-old surviving spouse of a postal employee receives the benefit.
A cost analysis prepared by the Postal Service inspector general found that $19 million could be saved over the next 10 years if 255 totally disabled employees on workers' comp were required to take civil service retirement.
Collins, chairman of the Senate Governmental Affairs Committee, plans to hold hearings on the postal workforce in early February. She and Carper hope to move legislation this year that would help the Postal Service regain its financial footing in a competitive market that is being transformed by e-mail and the Internet.
In the House, Rep. John M. McHugh (R-N.Y.), chairman of the Government Reform Committee's special panel on postal reform and oversight, plans to sponsor legislation that would change postal operations. McHugh, who has worked on postal issues for nine years, will hold a hearing today and will hear from unions and postmaster groups at a Chicago hearing early next month.