IG says USPS should consider locality based pay

From a white paper recently published by the USPS Office of Inspector General:

uspsoigThe ongoing debate about the comparability of postal employee wages to their counterparts in the private sector has rarely included discussion of one key element of the U.S. Postal Service’s wage structure. Private sector companies commonly pay employees based on the local cost-of-living and labor market conditions. As a result, it is well understood that someone working in Manhattan, New York will earn more than someone with an identical job in Manhattan, Kansas. The federal government recognizes this notion through well-established locality pay systems for both its white-collar and blue-collar workers. In fact, the federal government was already recognizing the importance and necessity of offering wages based on local conditions at least as early as the Civil War.

The Postal Service, however, does not pay employees based on local labor market conditions. Despite vast regional differences in labor markets and costs of living, the Postal Service pays the same wage for the same job regardless of location. As a result, postal employees can be among the highest-paid workers in some areas of the country and among the lowest-paid workers in other locations.

Paying higher wages than necessary in some locations would drive up the Postal Service’s costs. Paying below market wages in other locations may make it difficult to attract and retain a qualified, motivated work force, which may affect service quality. It is likely this may happen most often in large urban locations and other areas with strong economic growth. As an improving economy reduces the unemployment rate, the importance of this issue may increase nationwide. Additionally, the work demanded from the Postal Service is likely to be more complex in the future. It is essential going forward that the Postal Service continue to be able to attract a skilled work force in high-cost areas like major cities.

Given the Postal Service’s current financial situation, it is unlikely that it could afford to implement locality pay in a way that would incur additional costs. Nevertheless, bringing its pay systems more closely in line with the best practices of the federal government and the private sector through a locality pay system could substantially improve the long-term efficiency and value of the Postal Service’s workforce, benefiting all of its stakeholders.

Office of Inspector General | United States Postal Service.

  • Frank Nyberg

    The unions were always against it.. This is a case where the metropolitan locals lack the clout to make locality pay a contract request in negotiations when their contract is due.

    • Ted Barrero

      The unions would actually be for it, as the larger cities would be where the higher pay would be needed. Management, however, has no unions, thus their pay could easily be changed to a locality based structure. But, in the end, this is just another OIG post of the month which will not mean anything.

  • leftfordead

    The post office doesn’t want “a skilled workforce”. They want drones.

  • Frank Nyberg

    Fact is that the largest local of the NALC Branch 6000 repeatedly tried to include it in the unions platform at conventions. It was always voted down. Those against it do not want to see big city carriers make more than them and they are concerned their pay would be frozen or reduced.

    • BigBob

      True – always voted down. That’s because most USPS workers live in areas of the country where cost of living is cheap and USPS pay is considered huge.
      Unfortunately, big city workers can barely scrape by, with additional spousal income a necessity.
      The majority rules.

  • Larry Beauchamp

    How many private sector workers make $25/hr + premium benefits anywhere in the country? Starting pay sure isn’t minimum wage.

    • Scott

      UPS!

  • fred

    Are they going to raise the price of stamps in high cost areas? If the urban areas want higher pay, they should also have to pay more for stamps.

    • Reginald

      No. If they raise stamp prices anymore then they would be higher than your IQ.

  • MrPolarBear

    Both UPS and FED Ex starting pay is more than the USPS. Just ask a CCA. Also….. UPS hourly pay is more than USPS. They make more and have weekends off.

  • KJ

    I’ve worked in small towns in the midwest and large cities throughout my letter carrier career. Small town carriers work much harder than most large city carriers. I believe that the pay scale is as fair as it can be, and just changing things for the sake of saying they are “saving the PO” is what has got us into most of the problems in the first place. But, it seems like liberals in large cities seem to get their way these days, so…

    • BigBob

      Yep, those big city liberals always get there way. Just ask Sean Hannity.

  • John Griffing

    Just give those of us who were TE’s and stayed on as CCA’s our $6/hour back!! Because of this BS pay cut imposed by a BS third party arbitrator [who was fired by Major League Baseball] I now bring home over $1000 less per month!!

  • MtnPostmaster

    The USPS would just use this as an excuse to lower the pay of rural workers and just keep urban workers pay the same! There would be no great “Locality Pay” just an excuse to lower wages for another group of employees. Remember the old saying “Divide and Conquer”!

  • ron

    Thats fine but the IG needs locality pay also!
    I am sick of all these people trying to kiss up but it doesn’t effect them!