Embargoes and Redirections at U.S. Postal Service Processing Facilities
Objective
Our objective was to evaluate the operational impacts experienced by the Postal Service before and after the embargoes and redirections at mail processing facilities during the fiscal year (FY) 2021 peak mailing season.
Each year, increased mail volume during peak mailing season — November through January — significantly strains the Postal Service’s processing and distribution network. During the peak mailing season of FY 2021, increased package volume and reduced employee availability resulting from the COVID-19 pandemic added even more strain on the distribution network and led to temporary embargoes of up to 17 days for certain mail types at nine mail processing facilities: the Birmingham, AL Annex; West Valley, AZ processing and distribution center (P&DC); Baltimore, MD P&DC; Detroit, MI network distribution center (NDC); New Jersey (City), NJ NDC; Northwest Rochester, NY NDC; Cleveland, OH P&DC; Springdale, OH Annex; and Philadelphia, PA NDC.
Package volume at these nine facilities increased by a range of 7 to 54 percent during the FY 2021 peak mailing season, which was more than the Postal Service anticipated or had the capacity to process. Facilities that accepted more packages than they could process experienced crowded conditions on the workroom floors which became so congested that employees could not move mail between the processing equipment and loading docks.
The types of mail that were embargoed are usually inducted into the Postal Service’s mailstream through drop shipments, which are discounted mailings transported by a commercial mailer using their own or contracted vehicles at discounted rates.
We reviewed mail processing, employee availability, mail volume, and productivity data from October 1, 2019, through February 28, 2021, at each of the nine processing facilities that imposed embargoes. We conducted in-person observations at the Baltimore, MD P&DC, and performed virtual visits of the remaining eight facilities.
Findings
We found opportunities exist for the Postal Service to address the operational conditions that could result in imposed embargoes and redirections by enhancing communications throughout the agency and with its customers, improving its oversight of operations and conditions at its processing facilities, and strengthening internal controls over employee availability. Specifically, at the nine facilities:
Management was not proactive in assessing the need for embargoes and redirections. The decision to embargo or redirect mail only came after facility conditions became so congested that mail could not be processed efficiently.
Management was inconsistent in communicating to the affected processing facilities that embargoes or redirections had been imposed and did not announce the embargoes or redirections in enough time to allow mailers to make other transportation arrangements.
The Postal Service did not acquire enough additional facility capacity prior to peak mailing season to receive, stage, and process the additional mail volume.
Congested conditions at Postal Service processing facilities led management to direct that packages be processed and dispatched before other mail that arrived sooner. This practice helped clear space on workroom floors to process the backlogged mail volume; however, mail was not processed in first-in-first-out (FIFO) order to meet service standards.
Employee availability was reduced during the FY 2021 peak mailing season even as the Postal Service struggled to hire and train enough temporary employees for peak season. While the COVID-19 pandemic had a major impact on the Postal Service’s employee availability, insufficient internal controls over unscheduled employee absences that existed before the pandemic worsened the problem.
As a result, the Postal Service could not meet the operational demands of the FY 2021 peak mailing season at all locations. If the Postal Service does not address these concerns, it will be challenged with making appropriate business decisions to effectively adjust to major disruptions in the future and prepare for increased package volumes and upcoming peak mailing seasons.
Recommendations
We recommended management:
- Develop, document, and implement standard operating procedures to improve communications about major disruptions in service across the division and processing facility levels of management.
- Develop a plan to promptly communicate information about major service disruptions to mailers so they can adjust their operations as needed.
- Develop a plan to identify facilities at risk of having their volume exceed processing and staging capacity and alleviate those conditions before they affect mail processing during peak season.
- Develop a plan to verify that mail is processed in FIFO order during high volume periods to ensure that it will meet its service standards.
- Strengthen internal controls over employee absences to ensure adequate employee availability during peak season.