How the new service standards may slow down much more mail than the Postal Service is saying

January 11, 2015

The mail is slowing down again, but it's not clear how much.  There's good reason to be believe, though, that it will more than the Postal Service is saying.

The first slowdown took place in July 2012, when the Postal Service implemented phase one of the Network Rationalization plan, which closed about 150 mail processing plants and established interim service standards that eliminated overnight delivery for about 20 percent of the mail that had been getting it. 

The mail slowed down again in March 2013, when the Postal Service implemented its Load Leveling plan, which added a day to the delivery of much Standard Mail so that ad mail normally delivered on Monday could be pushed to Tuesday. 

Then on January 1, 2015, the Postal Service began implementing phase two of Network Rationalization.  Service standards for First Class Mail were relaxed yet further — no more overnight delivery for any single-piece mail, and an extra day of delivery time for about half of all First Class Mail.  The change paves the way for closing 82 more processing plants and eliminating thousands of jobs.  

The Postal Service has not put out a lot of information about how much mail will be affected by the new service standards, and the estimates that have been provided are inconsistent and a little misleading.  That may be because postal officials want to limit the damage the changes could have on mail volumes and revenues.

Relaxing service standards is, after all, another form of raising postal rates.  It’s like when the candy bar gets smaller and the price stays the same.  For mailers, such hikes usually mean they send less mail.

When the Postal Service was planning Network Rationalization back in 2011, it wanted to know how reducing service standards would affect mail volumes.  It contracted with a market research company to survey mailers about how they would react.

The market research study showed that mailers would significantly curtail their volumes.  The losses to the Postal Service could top $5 billion a year in gross revenues and $2 billion in profit, which would have erased the savings from the plant closures. 

The Postal Service buried the study, had another one done instead, and tweaked the format and questions to come up with more palatable results.

Now the Postal Service is trying to downplay the scope of the changes in service standards in order to minimize the impact on mail volumes and revenues. 

 

"The bottom line is this"

USPS Fact Sheet issued in December 2014, shortly before the service changes went into effect, poses the question, "Won’t this slow down service?" and then provides this answer:

"Overall, the time it takes First-Class Mail to reach its destination will increase slightly from an overall average of 2.14 days to an overall average of 2.25 days." 

That makes it seem as if the mail is doing to slow down by just two or three hours when in reality much of the mail will be delivered a full day later. Providing an average delivery time like this is misleading and doesn't really capture what the changes will mean.

Earlier this week, the Postmaster General tried to downplay the significance of the changes in another way.  During the Q & A after his speech at the National Press Club on January 6, the PMG explained how it will be more efficient to operate fewer plants for more hours per day.  The PMG then went on to say the following:

“The bottom line is this.  With the exception of the holiday and your birthday, okay, you think about your own mail box. When is the last time you got a piece of mail that had a stamp on it?  Yeah. You don't get it.  This whole change represents at most 4% of the mail.  We think it's closer to about 2.5%. So you can't hold an entire system hostage and continue to run up debt and continue to avoid making investments over 2% to 4% of the mail, and that mail is, unfortunately, for us going away at the fastest pace.”  (The video and transcript are here.)

Apparently the PMG did not get that USPS Fact Sheet.  It says, “In January 2015, the Postal Service will change its First-Class Mail service standards, which will affect roughly 14 billion pieces of the total volume (or 9%) and up to 16% of First-Class Mail. The affected volume represents primarily single-piece First-Class Mail.  The majority of this mail will be delivered in two days instead of one.”

So while the PMG was minimizing the delays and telling the Press Club that they would affect 2.5 to 4 percent of the mail, the Postal Service was acknowledging that it would impact 9 percent.  

The bigger estimate is more realistic, but even it probably lowballs the numbers by a significant amount.  As the following analysis will show, the changes in service standards could slow down 80 percent of single-piece mail, half of all First Class mail, and over 20 percent of total mail volumes — several times what the PMG told the Press Club.

NRLCA, APWU, and USPS go to court over who sorts the mail

January 8, 2015

Early last fall, the American Postal Workers Union (APWU) filed a labor grievance against the Postal Service concerning who separates and sorts the mail brought back to the post office by rural carriers.  Now the National Rural Letter Carriers' Association (NRLCA) has filed a lawsuit against the Postal Service and the APWU over the issue.

The case involves work assignments in Jacksonville, Florida, which has over 200 rural routes and 250 rural carriers.  It's the second largest post office in the country for rural delivery.

When rural carriers in Jacksonville return from their routes, they separate and sort the mail they’ve collected. It’s been that way for several years.  But the APWU claims that members of its bargaining unit should be doing this work and getting paid for it, so the union filed a grievance against the USPS.

The APWU and the USPS scheduled an arbitration hearing on October 29, 2014, before arbitrator Harry Gudenberg.  When the NRLCA received notice about the upcoming hearing, it sought “full-party status” in the dispute, including the right to participate in the selection of the arbitrator. 

The NRLCA objected to the choice of Mr. Gudenberg because he has a contractual relationship with the APWU and USPS as a member of their permanent arbitration panel.  The NRLCA wanted a neutral party to serve as arbitrator.

The October 29 hearing was postponed to give the parties an opportunity to work out their differences, but that effort was unsuccessful.  The USPS ended up refusing NRLCA’s request for a new arbitrator and instead went ahead and rescheduled the arbitration hearing for February 4, 2015, again with Mr. Gudenberg.

On Christmas Eve, the NRLCA filed a complaint with the D. C. District Court against the Postal Service and the APWU for proceeding in this manner.  The NRLCA also filed a motion requesting  a preliminary injunction blocking the arbitration hearing set for February 4.

That same day, the court granted the injunction, observing that the NRLCA “has a substantial likelihood of success on the merits and that plaintiff NRLCA will suffer irreparable injuries absent the issuance of a preliminary injunction.”

In its complaint, the NRLCA argued that it was important that no decision on the case be made over the coming weeks because a mail count is scheduled to begin on February 7.  The mail count is significant because it helps determine the annual salaries of rural carriers.  Every year, for a period of two to four weeks, rural route job functions are counted, timed, measured, and recorded, and the numbers are then converted into time (hours, minutes, and seconds), which is then used to compute the carrier’s annual salary.

The NRLCA argued that if Mr. Gudenberg were to rule that APWU workers should be doing the separation and sortation, they could very well be doing this work during the next mail count, which is set to begin on February 7.  Were the NRLCA ultimately to prevail on the case and retain the right to do this work, there wouldn’t be any data to use to compute their salaries.

On New Year's Eve, the Postal Service filed its brief in response to the NRLCA's motion for a preliminary injunction.  The USPS attorneys argued that the federal courts do not have jurisdiction to issue temporary or permanent injunctions to restrain arbitration in cases involving or growing out of labor disputes.

You can see many of the documents that have been filed on the case here

(Photo credit: Baymeadows carrier annex in Jacksonville, Florida)

RIF date for POStPlan Postmasters extended until February

January 6, 2015

The Postal Service has announced that the Reduction in Force (RIF) separation date for all remaining impacted POStPian Postmasters has been extended from January 9 to February 7, 2015.

According to a letter sent to these postmasters (dated Jan. 5), there are also new options for some of these impacted employees.  At offices going to two or four hours per day, the postmaster can accept an assignment offer if available effective February 7, 2015, to a career part-time flexible clerk position. 

You can see the letter here, and the presentation slides here.  There's also an addendum to the September 2014 Memorandum of Understanding between the Postal Service and APWU here.

The Postal Service and postmasters associations have not provided a list or number of how many postmasters are looking at a RIF, but we’ve heard that there are about 250 of them. 

There may be many more than that, however.  For the past couple of years, the Postal Service has been publishing “status reports” on where POStPlan is being implemented.  The reports for November and December 2014 (which also includes January 2015) show 1,350 post offices.  You can see a list merging these three reports as a spreadsheet or a table.  (You can find the original USPS reports here.)

POStPlan was implemented at about 280 of these 1,350 offices in November and December.  The remaining 1,068 offices show an implement date of Jan. 10, 2015. 

Many of the postmasters at these remaining offices are retiring, so they’re not all going to get a RIF notice, but the final number could be significantly more than 250. 

The one-month extension on the RIF notices suggests that the Postal Service would like to find a “soft landing” for as many POStPlan postmasters as possible.  Hopefully the extension will give the Postal Service and the last of the impacted postmasters a little more time to avoid at least some of the RIFs. 

(Photo credit: Abbeville, MS post office, implement date of 1/10/15.  Photo by Evan Kalish.)

Where have all the blue boxes gone?

January 2, 2015

Finding a good old-fashioned mailbox where you can drop off a letter is becoming almost as difficult as finding a pay phone.  The iconic blue boxes are getting to be few and far between.

Fifteen years ago, there were almost 400,000 collection boxes in the country.  Now there are fewer than 160,000 of them, and the number goes down every year.

Earlier this week the Postal Service submitted its Annual Compliance Report (ACR) to the Postal Regulatory Commission for the Commission's Annual Compliance Determination report.  The main purpose of the review process is to determine the extent to which each type of mail is covering (or not) its attributed costs.  The ACR therefore contains a mountain of data about postal rates.  

According to the Postal Accountability and Enhancement Act, which says what the ACR should include, the  Postal Service is also supposed to report on customer access to postal services.  But the subject gets just one page in the report, and collection boxes merit just one sentence:

“Nationally, there were 156,349 collection boxes available at the end of FY 2014, compared to 159,729 at the beginning of FY 2014.”

The ACR also includes a table showing the number of boxes, area by area, at the end of FY 2012, 2013, and 2014.  The following table uses those numbers, along with the year-to-year changes in percent from the previous year.

Nationwide, over the past two years the number of boxes has decreased by nearly 8,000.  That's the net decrease.  Considering that the Postal Service sometimes puts up boxes in new locations, it's likely that more than that have been removed.  Even so, the rate of decrease — 2.1 pecent over the past year —  is not as bad as it's been in previous years, as a look at the history of collection boxes shows.

 

Here today, gone tomorrow

Collection boxes were first introduced in 1858.  In their heyday, the boxes also served as storage facilities for carriers who made their rounds on foot, holding items such as rain gear and coats.  Now that most carriers have vehicles, the gear is in the truck and the mailboxes just collect mail.

For well over a century, the number of collection boxes grew along with the population of the country.  By the early 1970s, there were almost 400,000 of them.

According to data provided to the PRC by the Postal Service (in connection with a complaint filed by postal watchdog Douglas Carlson in 2002), the number of boxes fluctuated throughout the 1970s and 1980s, sometimes going up, sometimes down.  In some years, there were as few as 260,000, while at other times, there were as many as 386,000.  According to this USPS report, in 2000 there were still 365,000 collection boxes on the street.  

Then in 2002, in order to save fuel and labor costs, the Postal Service began an aggressive program to cull what it considered underused boxes.  Over the next few years, the number of collection boxes decreased dramatically.  A 2009 news report observed that the Postal Service had been removing the boxes nationally at the rate of more than 60 per day.  According to a BBC report, there were 175,000 boxes as of July 2009.

Since then, the rate of decline has diminished considerably. Over the past two fiscal years, some 7,750 boxes have been removed — about 15 per day. 

In order to identify which boxes are underperforming, a postal employee does a density check that involves counting pieces of mail per day over a period of two weeks.  Back in 2006, when the Postal Service was aggressively removing the boxes, if there were fewer than 50 pieces of mail per day, a box could be targeted for disposal.  

According to the Postal Operations Manual, the current policy is that if a mailbox isn't seeing an average of 25 pieces per day, the Postal Service may remove it.  The Postal Service is required to post a 30-day notice on the box before it’s removed, and customers are invited to comment. 

While the rate of removing boxes may not be as bad as it was a few years ago, customers still don’t like it when their box vanishes.  News articles regularly report collection boxes disappearing and customers complaining. 

This past summer, there was a report that 39 boxes had been removed from the streets of Rockford, Illinois, which left the city with 102.  In January, 16 boxes were removed from Redlands, California, after the Postal Service determined that they were being underused.

Earlier this month, a news team in Coronado, California, observed that several boxes had vanished.   A mail carrier said that many folks along his route had complained about the “missing boxes.”  He also said that it's harder for the elderly to get down to the post office or find parking.

And that’s basically the issue: By removing the collection boxes, the Postal Service saves some money, but the savings comes at the expense of average customers, who end up having to spend their own time — and often gas too — going to a box that is further away.

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