Strong customer demand for goods purchased over the Internet has driven growth in the package market despite otherwise declining mail volume. This growing package segment provides the U.S. Postal Service an opportunity to expand services and increase revenue.
With this growth, city carriers and non-career city carrier assistants (CCA) are now delivering more packages and fewer letters to more addresses each year. To accommodate these changes, the Postal Service must adapt to this changing mail mix while maintaining service and efficiency.
The Los Angeles District’s package volume increased from 62.3 million in fiscal year (FY) 2014 to 69 million in FY 2015 – an increase of about 11 percent. This growth is a direct result of eCommerce and initiatives such as Sunday delivery, grocery delivery services, and Ship from Store, a service where the Postal Service picks up and delivers customer orders from local stores. Package deliveries now regularly occur as early as 3 a.m. and as late as 10 p.m.
The Postal Service’s goal is to have 90 percent of city carriers return from street operations before 5 p.m. and 100 percent by 6 p.m. Carriers returning to their units on time helps the Postal Service meet operational goals for mail processing.
In FY 2015, the Los Angeles District’s 4,445 city carriers and CCAs delivered about 2.2 billion mailpieces to over 2 million delivery points on 3,102 routes.
Our objective was to evaluate city carriers returning to the office after 6 p.m. in the Los Angeles District.
What the OIG Found
City carriers and CCAs in the Los Angeles District did not meet the goal of 100 percent returning to the office by 6 p.m. In FY 2015, 82 percent of city carriers and CCAs returned to the office by 6 p.m. in the Los Angeles District. Our analysis of 15 randomly selected delivery units found similar results. Our review showed that only 84 percent of city carriers and CCAs returned by 6 p.m. and some were on the street as late as 10 p.m.
These conditions occurred due to outdated route adjustments and base package volumes, unfilled supervisor vacancies, insufficient supervision at city delivery operations, late mail arrival, and improper mail mix. These conditions were also due to staffing issues that included unfilled city carrier vacancies, the inability to retain CCAs, and incomplete city carrier and CCA complement data.
During our audit, management filled city carrier vacancies at the 15 delivery units we visited and updated incomplete city carrier and CCA authorized complement data; therefore, we will not make recommendations on these issues.
City carriers returning to delivery units after 6 p.m. increased the district’s overtime and penalty overtime workhour costs. The Los Angeles District’s use of additional overtime and penalty overtime workhours resulted in about $31 million in questioned costs annually. Improving staffing and adjusting routes and mail flow could eliminate excess overtime and penalty overtime and help the district realize a cost avoidance averaging $27.3 million annually.
What the OIG Recommended
We recommended management evaluate actual package volume data for city delivery units and modify route base package volume estimates through route adjustments or minor route adjustments. We also recommended management fill supervisor vacancies within 6 months and provide city delivery supervisory training to all promoted and temporary supervisors, where appropriate; properly report and record all instances of late mail arrival and improper mail mix in the Customer Service Daily Reporting System and Delivery Operations Information System; and conduct a study to evaluate the impact and cost of late mail arrival and improper mail mix dispatched to delivery units and take appropriate action.