Cost-Cutting USPS Begins Contract Talks

Cost-Cutting USPS Begins Contract Talks

The U.S. Postal Service launched high-stakes contract negotiations with its largest union on Wednesday, the first in a series of talks with labor groups that come as the USPS seeks to cut its costs to match declining demand for mail service.

Contracts with two of the USPS’s four unions are set to expire Nov. 20, including the pact with the American Postal Workers Union that covers some 211,000 workers.

The Postal Service hasn’t detailed any offer it will make to the APWU, but the USPS is trying to cut back its costs with actions including the end of Saturday delivery.

Talks with the National Rural Letter Carriers’ Association are to begin Sept. 13. That contract also expires Nov. 20.

“We have worked successfully with our unions in the past to help transform the Postal Service and we hope to maintain this momentum during these negotiations,” said Anthony Vegliante, chief human resources officer and executive vice president.

The USPS recently reported a $3.5 billion loss in its quarter ending June 30 and warned that it will run out of money over the next year if it does not get relief from its large pension obligations and reduce its cost structure.

Mail volume, meanwhile, has declined 20 percent since 2007 and the USPS recently struck a deal that will put postal services into Office Depot stores, an effort to draw in mail volume without using traditional post offices.

Contracts with the National Association of Letter Carriers and the National Postal Mail Handlers Union have another 14 months.