Budget Negotiators Reject Saturday Delivery Cut, Unfairly Target Future Federal Employees

Five Day Wrong WayNational Association of Letter Carriers

Dec. 11, 2013—NALC grassroots activists and the American public scored a huge victory on Tuesday when efforts to include elimination of Saturday mail delivery in the emerging budget agreement for 2014 failed.

National Association of Letter Carriers President Fredric Rolando reacted with gratitude and relief. “Thanks to the thousands of dedicated letter carriers, citizens and small-business owners who raised their voices in opposition to this misguided proposal to slash delivery service,” Rolando said, “Congress will not unwisely weaken the Postal Service or undermine our last-mile delivery network. They have not only helped save tens of thousands of good jobs, they have preserved a path for recovery and growth for the USPS in the future. This is a win for tens of millions of Americans and countless businesses throughout the country that rely on the Postal Service for the world’s most affordable delivery service.”

“Congress must continue to reject any legislation that would lead to the elimination of Saturday mail delivery,” he added.

Sen. Patty Murray (D-WA) and Rep. Paul Ryan (R-WI) announced on Dec. 10 that they had reached a deal to partially replace the across-the-board spending cuts, known as sequestration, that were called for by the Budget Control Act of 2011, with a package of alternative spending cuts and revenue raisers. Ryan had proposed the Saturday delivery cut as a measure that would save $20 billion over 10 years, a figure NALC and others strongly contest. Murray stood firm with the nation’s letter carriers and the American public and rejected the proposal.

The budget agreement calls for a combination of higher fees on airline tickets, changes in natural resource programs, measures to reduce “waste, fraud and abuse” in other federal programs, and increased contributions for federal-postal employee pension programs.

In addition, the spending limits in the Budget Control Act of 2011 were modestly increased from the damaging sequestration levels that have slowed the nation’s economic recovery.

Under the budget deal, federal and postal employees hired after Dec. 31, 2013, will be required to contribute 4.4 percent of their basic pay for Federal Employees Retirement System (FERS) pension benefits, 1.3 percent above the 3.1 percent contribution rate for federal employees hired after 2011 and 3.6 percent above those hired before 2012. Benefits will not be raised in return for the higher contributions, since agency contributions will be reduced by the 1.3 percent.

Although totally unjustified and unfair, the increase in pension contributions for new hires was adopted after weeks of negotiations in which Ryan pushed for a proposal included in the House-passed budget: an increase of 5.5 percent in pension contributions for all federal and postal employees (present and future).

President Rolando thanked Murray for seeking to minimize the effect of this, but he criticized the hit on federal employees as unfair and irrational. “Once again, Congress has singled out federal and postal employees for deficit reduction, even though our community has been repeatedly targeted in the past and we have contributed more than our fair share,” Rolando said. “There is now an irrational three-tier pension system for FERS employees, where different groups of employees will pay different amounts in payroll contributions, yet receive the same level of benefits. That’s totally unacceptable.”

Two other provisions affecting federal employees were included in the package. One would authorize the Office of Personnel Management (OPM) to expand the choice of Federal Employees Health Benefit Program (FEHBP) plans to include “self plus one” in addition to the current “self only” and “self & family” plans. NALC is studying this change.

Another provision supported by all federal unions would put a cap on excessive executive salaries for federal contractors: Companies with federal contracts would no longer be able to charge the federal government for salaries that exceed $487,000 annually.

NALC joined an all-out push to save Saturday delivery for the American people and worked to prevent a massive 5.5 percent pay cut for letter carriers. We led a coalition to inform Congress, set up a toll-free phone line to connect letter carriers with their representatives in the House, and used our e-Activist Network to deliver thousands of messages to senators and representatives. We also worked with our allies, organized by Delivering for America and the Federal-Postal Coalition of unions. These allies included the other postal unions—APWU, NRLCA and NPMHU—and thousands of small-business owners, veterans, rural residents and senior citizens.

“I thank all our allies and all of the NALC members who helped,” Rolando said. “I urge members who didn’t do their part this time to do so next time—and believe me, with the fight over postal reform just starting, there will be a next time.”

“We will vigorously oppose any legislation that will lead to the elimination of Saturday mail delivery,” he said.

The budget deal reached by the chairmen of the Senate and House budget committees is expected to face a vote in the House of Representatives on Friday and in the Senate next week. In the days ahead, NALC will work to remove from the proposed deal the increased pension contributions for future employees.

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