USPS spent close to a billion dollars in overtime in first quarter

Despite declines in mail volume and cost cutting measures, the US Postal Service paid employees $980 million in overtime during the first three months of its fiscal year, according to reports filed with the Postal Regulatory Commission. a 16.7% increase over the same period a year ago. The reports cover the period from October 1 through December 31.

During that period, the average overtime rate for bargaining unit employees increased from 7.8% the prior year, to 9.1%. The numbers suggest that the USPS isn’t overstaffed, at least in terms of its current workload, and that as employees leave the service, the USPS has had to replace them, at least to some extent, with overtime hours.

Straight time work hours provide a reasonable indicator of staffing levels. In the first quarter, the USPS saw a reduction 7.3 million straight time bargaining unit hours. During the same period, overtime hours increased by 3.1 million. That means that for every ten employees who retired, the USPS had to replace four of them with additional overtime hours.

Among city carriers, straight time work hours were down 2.2 million, but overtime hours increased by 2 million- almost a one for one replacement. The average city carrier worked 11.8% overtime over the last three months, compared with 9.8% the prior year.

The situation was different for clerks, whose workload is more sensitive to volumes and the impact of automation. Clerk straight time hours decreased by 3.8 million hours, while overtime increased by just 600,000. Even so, the average clerk worked 8.6% overtime during the period, compared with 7.5% the prior year.

The fact that the USPS is using these levels of overtime doesn’t necessarily indicate a problem. The first quarter is still a relatively high volume period. And given the fact that the service has a mostly full time workforce, very low levels of overtime would suggest that the USPS is indeed overstaffed. A reasonable level of overtime is cheaper in the long run than hiring more staff- you can increase overtime more easily than you can reduce straight time.

But the OT levels in the carrier craft suggest that if the USPS is not successful in getting Congress to agree to five day delivery, it will eventually have to start adding more letter carriers. Even if mail volume doesn’t turn around as quickly as expected, delivery points will continue to increase, adding to the carrier workload. Eventually carrier OT will increase to a levels that won’t be sustainable given the increase in costs and decrease in efficiency.

  • Charlie

    City Carrier overtime is “suggested” by the NALC, as a way to keep positions secure. Volumes are still down, but we are not allowed to decrease employees, or perform Formal Route Counts to determine what we really need as opposed to what we actually have.

  • Nutzy

    Well A few years ago they decided to eliminate routes.They take A route and cut it saying it is no longer 8 hr. just A aux. Then excess a carrier to another office. This route still has to be carried so it is pivoted out.But rest of routes in office are adjusted to 8+ hrs on a light day.Ot is paid for work that should be straight time.This route is carried on OT. The PM gets Pay for Performance for eliminating A job on paper. Fact now it cost more to deliver same route.

  • brian

    ‘City Carrier overtime is “suggested” by the NALC, as a way to keep positions secure.’
    Charlie- what exactly does that mean?

  • brian

    Nutzy- the number of routes has nothing to do with Pay for Performance. Operating expenses ARE included in PFP- there’s no incentive to reduce routes if it doesn’t actually save money.

  • Nutzy

    Charlie first thing is blame someone elese in your case the union. If volumes are so low why not pivot carriers.OT is out of hand because most offices across US are short staffed.I would love A FORMAL Count as all carriers in my station.Better loosen your tie Charlie it is cuting off circulation and your ability to think clear. Keep working on your smoke and mirrors trick cause its not working yet.

  • Nutzy

    Brian it is not A real money thing.What is counted is regular hours.On paper if you cut Reg.hrs. you cut operating expense. Well not really but that is how they do it.

  • Mike

    I wonder how much adjusting the routes using COR have contributed to the increase in OT? In my office of 29 routes, COR maximized walking instead of driving even when driving was significantly faster overall. The most obvious instance of this is a fellow carrier that was suppose to make a 1/2 hour round trip to walk to 1 business on his route instead of driving it in 10 minutes. Of course COR did not give him 30 minutes, it didn’t take into account the time to walk through the I-75 interchange that is necessary to get to the business.

    In the case of my route, COR made the street time 20 minutes longer overall and actually decreased the number of stops I deliver.

  • Robert

    With the historical drops in volume over the last seven years the Postal Service has needed to downsize the workforce to offset this volume loss. Replacing regular workhours with overtime accomplices nothing. This brings us to the root of the Postal Service’s financial problems. The Postal Service has failed miserably to promote the most qualified people and is suffering because of it. Any business that promotes incompetent people won’t be in business for long…and that’s just where the USPS stands at the present time. Show me a Postal District that’s failing to make it’s budget and I’ll show you a management team that should be working somewhere else for a lot less money. All of this starts with the Postmaster General…can anyone honestly remember the last time we had one that you would hire to run your business? Enough said.

  • brian

    Nutzy- sorry, but you’re wrong. Total workhours include overtime hours. The idea that you could save money “on paper” by using overtime instead of straight time is ridiculous. PFP targets are based on workhour performance to plan, total operating expense, productivity, etc., all of which are based on the workhours you use, including overtime.

  • Ralf

    Yes, and I thank you for the 20K in OT, and Penalty $53.00 per hour pay.
    The USPS did not hire because they are waiting to hire Partime at lower rates in the new contract. So the have intentionally abused older carriers to retire. THe NALC looked the other way. Hence those of us who can kick’ass on delivery made bank. I know a guy who made near 100K
    Hire management people “Outside” the post office if you really want this business to produce at a profit.

  • Ralf

    As for 5 day delivery. I hope it does happen.
    I will be working 12-14 hour days to get all the mail delivered. Because friend, it’s there!
    The crap keeps coming~
    5 Day will mean I will earn ot after 8, and double time after 10….for pizza coupons………….

  • frank

    It has been a long time since 18/8 was established..I think there should be an update, review current casing time based on true volume at the carrier case and correct the requirements to be more in line with reality.
    does it really take 1 hour to case 1080 ltrs and 480 flats?
    automation has left my case with around a tray of ltrs and a few tubs of flats (caseable volume) DPS don’t count. I’m ready around 945 to go to street…however I do agree about the OT cause I get back every day for the handoffs and yes this is where all the OT comes from.used to be we had PTFs for this but they all got to be regulars and bid routes, PO don’t get it.. just guting the force to bare bones to look good is a mistake, and the customer is the looser

  • Mailmover

    Notice anyone that they didn’t bring up the overtime hours for Mail Handlers? Since we don’t get penalty overtime, our hours must not count. It would be interesting to see how much of that 980 million was Mail Handler Overtime and how many casuals were paid overtime during this time period.

  • JY

    In my particular office, we currently have 12 routes, a combo (PP) route (my assignment), plus 2 T-6 positions. When our office was adjusted the first time, we lost 2 full routes, one of them became an aux route. The aux route was short by 15 minutes while one route was nearly 10 hours. Fortunately, no one was excessed to other offices. After the next adjustment, the aux route became a full route which is now 8 hours 45 minutes and the 10 hour route got reduced to 9 hours. The next round of adjustments netted no changes. Instead the longest routes were offered, “router assistance…”

    Our office has major overtime issues. The biggest issue is that we have a number of aging carriers. I’m the youngest at 37 years old. Our office is authorized for a TE, but we don’t have one. When someone bangs in, it winds up being an OT day for everyone because we don’t have anyone to cover the route. The TE coordinator “gives” us a TE and 10 minutes later, take the TE away. The people having to pivot the route usually aren’t familiar with the route and having to deal with their own assignments which most people can barely get done most days.

    Volume is down in some/most locations, but definitely not all. In our office, volume actually went up due to a couple of new businesses and residents moving into the town. Our office has always had good parcel volume due to the amount of ordering our customers. Parcel volume has increased in the last couple of years. My assignment used to average 30 per day, it’s currently up to 50 per day.

  • jethro tull

    snow and ice have slowed the carriers down.with driving conditions that allow a safe delivery and patrons havent been cleaning their walk ways for carriers to access to the mailbox at their houses. most carriers are doing their best to get back safely and go home to the family. please remember the conditions change daily and they still deliver!with a shortage of clerks the carriers have to break down their own mail is many stations you cant wait for a carrier whos working accountables,passports,business reply and counting stock.

  • John

    Geesh! Happy to be where I am. On my route I worked less than 2 hours of OT from the beginning of the holidays til now and I never get mandated. Phew….I’m tired!

  • Joe was a 204B

    There is no such thing as an 8 hour route. Don’t you notice how you always have undertime? Managers give you a bogus leave time based on the volume they put into dois (get it? the volume they “put” in?) Maybe after everyone leaves they put in the additional volume and wow you are a super carrier!

  • JL

    USPS is probably keeping city carrier staffing down so that there is less impact when delivery days are reduced to 5 days. Again, taking care of current career employees (ensuring less movement/layoffs). 2 career employees at 1 1/2 time is still cheaper then 3 career carriers at 1 time (benefits/retirement), especially over the short time (a few years).

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  • Kenny Labbe

    Since when is OT more expensive than Full-time employees? That is news to me.

  • brian

    Kenny- you’re correct- the actual cost to the USPS for an hour of overtime is roughly the same as the actual cost for a straight time hour for a career employee. The “time and a half” premium for OT is offset by the fact that the USPS doesn’t pay for any added benefits (leave, health insurance, etc.) on overtime hours.
    I’ve edited the article to correct that mistake. I’d point out, however that beyond a certain point, OT hours really are more expensive because workers tend to become less productive as their workhours are extended.

  • Representative

    They must be holding mail for delivery. My son received his money magazine about a week before i got mine. We live in the same state and postal district. Some time we get mail for a sale that is too late for the sale!
    If the Postal service goes to a five (5) day delivery schedule that will be the end of the post office .If they can’t deliver all the mail in six (6) days some company’s will have too use some one else. Another problem is what will they do with all the extra people? You won’t need the T-6 jobs and the PTF’s. Just about every town in America will lose a job! People in the mailing industry will be laid off!

  • trout

    Obviously after reading all these statements it is quite obvious that the status quo is what we all want even thought it won’t cut it anymore. Anyone who believes volume is not down is living in a fantasy land. Overtime does not cost more than regular time because it is offset by not paying premiums? A wonderful case of semantics. If you want the status quo, keep dreaming…. the world has changed. We (unions/postalworkers/school teachers) are the crooks and the reason our economy has fallen apart. Not the bankers not wall street nor the politicians they pay off, it is us! All I can say is what I’ve been saying keep voting for Republiclowns, they are after your jobs and you own best interest.