On Wednesday, March 14, 2012, postalnews.com reported that a number of Postal Service employees saw a web page that had dead links to VERA and other retirement incentive. This set up a rapid rumor mill in message boards regularly frequented by Postal Service employees. Looking through these posts, it appears clear that an announcement is coming this week about which Postal Service employees will be eligible for early retirement, incentives that will be available, and dates by which employees must make their decisions. The following provides the information from news stories, comments on news stories, and bulletin boards that have the most credibility.
Early Retirement and Retirement Incentives
- The announcement will come on Friday March 16. March 16 appears more likely for four reasons: 1) multiple individuals report that plant managers are meeting on Thursday March 15; 2) It is the last day to announce reassignments over long distances that would happen on May 15; 3) human resources departments tend to prefer to make these announcements on Fridays; 4) and making the announcement on Friday afternoon reduces the public relations impact of the announcement.
- The effective retirement date for those taking early retirement will be Friday, June 1, 2012. FERS employees who are eligible for early retirement should consider retiring on or before Thursday May 31, based on when pension payouts can start.
- Early retirement will be offered to EAS, supervisors, APWU members and Mail Handlers. It is possible that it will be limited to employees affected to efforts to optimize the retail or mail processing networks. However, given how broad the geographic area that the restructurings cover, it would appear that few APWU members, Mail Handlers, supervisors or EAS employees will be exempt. It would seem likely that employees in positions that require skills that are in short supply (mostly EAS employees) will not be eligible for early retirement.
- Incentives will be offered. However, there is disagreement as to what type of incentive is likely. Here are the two possibilities that appear most credible. 1) The Postal Service will offer no added cash but will add 2 years credit for CSRS employees and 5 year credit for FERS. 2) The Postal Service will offer a $20,000 cash incentive divided into two payments, one paid upon retirement and the second paid in October of 2012. Of these two, the non-cash incentive option right now appears more likely
- The Postal Service may offer employees an option of graduated (phased) retirement. This would shift he employee from full to half-time status but they would retain all of their current benefits. Their job supposedly will involve training new full time employees. For management employees, the training requirement may be real. For craft employees, there is less likely to be much of a training component to their part time job. It is possible that this graduated retirement option could be offered to employees that are too young to retire or do not have sufficient service years to retire. (For more information see the story about phased retirement in the Washington Post.)
- The incentives offered this week will be the first of three rounds of incentives that will be offered over the next two years. The size and timing of future incentives will depend on the Postal Service’s finances and acceptance of this first round of incentives. There are some disagreements as to the timing of the three rounds with some seeing them happening over the summer and some believe that they may take as much as two years. Given the logistics of restructuring the network, it seems reasonable that the first round of incentives may have more than one retirement date either different areas will implement restructuring at different times or the Postal Service will want to implement most of restructuring in multiple steps over the summer with a few facilities closing after the new year which will require a smaller and more focused incentive offering in regions where these plants are located.
- Employees are likely to have only 30 days to make a decision regarding whether they will retire early or not. The 30 day time limit is linked to union requirements for reassignments
Reductions in Force (RIF’s)
The Postal Service has been coy about the possibility that Postal Service will have to lay off employees. However, given the scale of the reduction in employees, and its limited financial ability to offer retirement incentives, the Postal Service will likely need to lay off some employees. Confirming this impression, the Queens Chronicle reported that Darleen Reid, Postal Service spokesperson, stated that the Postal Service could not guarantee that no employees would be fired.
Most likely, employees that face the greatest risk of layoffs are EAS employees, supervisors and Mail Handers. EAS employees and supervisors have no layoff protection. Mail Handler layoff protections are linked to the current contract which most likely does not protect any mail handler hired in the last few years. While most APWU have protection from layoffs, APWU members may find that assignments available to them are so unattractive that they decide to leave Postal Service employment without being fired.
On a geographic basis, employees that work in the Eastern, Northeast and Southwest Areas most likely face the greatest risk of layoffs. Information provided the APWU clearly show that the Postal Service is cutting a significantly larger share of jobs in these areas than the other four. Therefore when the music stops there will likely be fewer opportunities for reassignments in these three Areas unless early retirements are much higher in them than in those regions with a lower job loss proportions.
While most of the discussions are focused on early retirements, the Postal Service will clearly need to implement significant reassignments of employees that do not retire. Given that long-distance reassignments require 60 day notice to meet union contract requirements, the Postal Service will likely announce reassignments within a few days after employees must decide whether they will take early retirement incentives. The Postal Service will offer two types of reassignments across crafts (i.e. from clerk to letter carrier) and within craft. These reassignment announcements should come sometime during the week of April 17, 2012 in order for the Postal Service to make its network readjustments in late June, 2012.
The impact of reassignments will likely be greatest in the Eastern, Northeast, and Southwestern areas for the same reason that the risk of layoffs are greatest in those ar