The U.S. Postal Service has launched many initiatives to address its financial challenges, including:
- Decreasing the number of headquarters management positions.
- Reducing the number of area and district offices.
- Reducing the number of administrative, executive, and postmaster positions by about 7,500.
- Offering both voluntary and incentivized retirement to employees who qualify under current rules for retirement incentives.
- Planning 146 consolidations of mail processing facilities for fiscal year (FY) 2013 and 114 for FY 2014—an expected savings of $2.1 billion annually.
- Reducing staffing levels by more than 100,000 career employees, with additional scheduled reductions of 155,000 full-time career employees by FY 2016.
Though many of the reductions resulted in savings, workforce reductions caused an increase in the Postal Service’s usage of overtime workhours. Using overtime workhours provides the Postal Service flexibility and allows the agency to meet operational requirements without increasing overall staffing levels. Management has set a 5-percent target rate for usage of overtime hours.
Recently, we looked at the reasons the Postal Service used significant overtime workhours during FYs 2011 and 2012. We also reviewed how the agency managed its usage of overtime workhours. Auditors found that overtime hours accounted for 7.4 and 7.8 percent of total workhours in FYs 2011 and 2012, respectively. They reviewed overtime use in three districts with the highest rates over the past 5 years and one district where employees received the highest overtime dollars. Auditors determined the Postal Service incurred significant overtime workhour use because management did not always align the workforce to workload or provide adequate supervisory oversight. In FY 2012, the Postal Service paid seven mail handlers at one facility between $65,000 and $76,000 each for overtime workhours, which more than doubled their salaries. Auditors found mail did not always arrive at delivery units timely, resulting in carriers waiting to begin their work and having to use overtime to complete deliveries. We estimated the Postal Service paid $2,312,303 in FY 2011 and $4,450,003 in FY 2012 for overtime associated with late trips at three of the four districts we visited.
We’d like to hear your thoughts on the Postal Service’s use of overtime. Is the use of overtime hours a reliable tool for managing workhours? If not, are there better tools and approaches? Let us know on our blog.