OIG recommends outsourcing more jobs, slashing contractor’s pay

The US Postal Service’s Inspector General issued a report last week suggesting that the USPS could save $675 million a year by outsourcing janitorial and truck driving jobs, and by slashing the pay of existing contractors. In its response to the audit, the USPS pointed out that it is already reducing wages under the new APWU agreement, which allows some USPS employees to be paid even less than a contractor: “…the new agreement provides for the establishment and use of non-career employees on a much wider scale than previously permitted and new employees will be paid at rates much lower than current career rates and, in some cases, lower than SCA [contractor’s] rate”.

Here are some of the findings from the report, which was undertaken in response to a request from Congressman Darrell Issa:

Postal Service market research indicated that opportunities exist for cost savings if it did not have to comply with the SCA. In addition, our analysis showed that Postal Service wages for cleaning/janitorial and postal vehicle service (PVS) driver positions were higher than SCA rates. We estimate the Postal Service could save approximately $675 million annually if it outsourced cleaning/janitorial and PVS driver positions.Barriers to outsourcing the positions include current labor union agreements, concerns that new unions will be formed, workforce retention issues, fluctuations in market or economic conditions, and the potential for congressional constituency concerns.

We recommended the Postal Service seek exemption from the SCA to allow flexibility to negotiate contract rates closer to market rates. We also recommended the Postal Service review the benefits of outsourcing cleaning/janitorial service positions and Postal Service vehicle driver positions and restructure those positions to achieve the most cost effective solution. Lastly, we recommended that the Postal Service ensure that appropriate financial data is collected to aid in making in-sourcing/outsourcing decisions.

USPS OIG: Contracting Opportunities and Impact of the Service Contract Act

CA-AR-12-001.pdf (application/pdf Object).

  • Me

    Does anyone else find it funny the the oig is doing this report. We have the oig and the postal inspection service two agencies that do essentially the same job. And why can’t we contract out their jobs to the FBI aren’t they supposed to police federal crimes anyway. We could save all that money when we get rid of all those high paying jobs each inspector makes six figures.

  • sick of it

    oh sure we can see where that is going. what next go to the local home depot and get all the people that stand around waiting to be hired for the day. pick them up and have them clean the plants. they already clean some of the offices, has anyone checked on their paper work. i saw some of them replacing tiles in one facility. what is wrong with them

  • Karen Ardoin

    If the monies overpaid into the CSRS retirement system were returned to the USPS (it is our money afterall, not taxpayer money), we would not have to do anything Darryl Issa is proposing. But then the federal deficit would look worse, wouldn’t it? This is nothing more than the same kind of union bashing that occurred in Wisconsin!

  • HMMMmmmmm…..

    Has the OIG forgot that Congress had the custodial jobs reserved for the 5/10 point VETERANS. Here we go again with the screwing of the US Veteran who was good enough to put their life on the line VOLUNTARILY but not good enough to have a job reserved for them that pays well enough to provide a decent living.

    I have one for you, have the OIG go clean the toilets and mop the floors for 10 bucks an hour and see if they can feed there family. Oh I forget, they aren’t veterans so they can’t get the job.

    I think I have agree with ME, fire the OIG and let the FBI do the job they were created for. The FBI agents don’t pull down as much as the OIG guys.

  • Veteran

    If we paid everyone a $1.00 per hour and cut out the 15 min break we would save even more money.

    What is wrong with this picture these were negoiated wages that have been agreed upon.

    I hope the OIG feels like they done a good service to the American people and Veterans.

    Let’s Outsource Congress…….

    And by the way if you look at the IT Contractors pay we could save money by bringing the Information Technology jobs back in house and convert them to Postal positions.

  • Gruntled

    Lets out source the PMG! And Congress too!

  • crazy

    “in response to a request from Congressman Darrell Issa” is the only line I needed to read to see where this whole article was going. great posts everyone.