Copyright 1999 Globe Newspaper Company
The Boston
Globe
December 5, 1999, Sunday ,THIRD EDITION
SECTION: BUSINESS; Pg. E1
LENGTH: 1315 words
HEADLINE:
POSTAL SERVICE LEANS TOWARD OVERHAUL IN E-MAIL ERA NONPROFIT STIRS UNION IRE;
LOOKS TO BECOME PLAYER IN THE PRIVATE SECTOR
BYLINE: By
Diane E. Lewis, Globe Staff
BODY:
BROCKTON - In
this city of 93,000, the United States Postal Service has become another example
of nationwide corporate belt-tightening.
The only problem: The USPS is a
nonprofit government agency. Tom O'Brien, president of the
South Shore-area local of the American Postal Workers Union in Brockton,
contends the USPS, in its eagerness to reduce costs, has taken on the
characteristics of a profit-driven corporation.
"The United States
Postal Service was never supposed to be a Wall Street corporation," O'Brien said
angrily. "It was supposed to be a nonprofit agency and a service."
Twenty-nine years after its first major reform, the
nation's postal system is facing an identity crisis so massive
its future direction is being debated nationwide from urban communities such as
Brockton to Capitol Hill, where Congress is considering a bill that would
require an overhaul of the system.
At issue: the future of the Postal
Service in an era of e-mail and e-commerce.
In all, 30 percent of the
system's revenues, or about $60 billion, is derived from
postage on first-class mail such as bills, payments, and letters. But with
competition from the Internet increasing and more consumers expected to switch
to on-line banking and bill paying, the Postal Service says it could lose up to
$17 billion in market share by 2003.
To deal with these
changes, the Postal Service is undergoing its own transformation, making a push
to compete in a private-sector market by launching ventures that have more to do
with technology and commerce than with delivering mail.
This competitive
drive has brought with it a business philosophy, one that has included
cost-cutting and downsizing through attrition. For the Postal Workers Union,
that has resulted in an onslaught of union grievances.
In Brockton,
under the direction of newly appointed Postmaster Ron Pauline, the Postal
Service has limited light duty for workers injured on the job and has stripped
South Shore letter carriers of their jeeps, citing a rash of curbside accidents.
But the changes prompted a Dec. 1 protest by about 200 union members and their
supporters, and 888 grievances have been filed this year, up from 238 in 1998.
Nationally, since introducing a buyout program seven years ago that
trimmed about 30,000 employees from its rolls, the agency has spent the past
five years automating more than 400 plants around the country and training new
managers and staff in the latest technologies. It also hired
PricewaterhouseCoopers to study ways to make mail delivery more efficient, and
it has developed standards aimed at increasing production and ending waste.
Now, the agency is backing legislation known as the postal modernization
act. Filed by Representative John McHugh, a New York Republican, the bill would
allow USPS to establish private companies that would compete in new and existing
markets.
One example, says spokesman Cesta Ayers: a private firm to set
up relationships with foreign postal services to ensure that first-class mail is
delivered smoothly between countries.
"Yes, we are moving in a different
direction than we used to, and we're making changes," acknowledged Ayers,
manager of field communications at USPS headquarters in Washington. "But if we
stay the same, we will go out of business."
The agency's new outlook
appears to have yielded results. Revenues this year have risen to
$62 billion from $54 billion in 1995. But
although it has made a profit each of the last five years, the agency's net
income continues to drop.
Internally, the Postal Service is moving
aggressively into electronic media. In August it launched PC Postage, which
allows customers to download postage stamps. Using their PCs, customers can also
download postage paid priority mailing labels.
The service also is
testing an electronic postmark that would help consumers verify that an e-mail
message was received and that its contents were secure from prying eyes.
"Our goal is to have mail remain relevant to the American public," said
Judy de Torok, a USPS spokeswoman. "We're also looking at electronic mail boxes
and a whole new range of services. For us the challenge is, how do we continue
to reach customers in the electronic world?"
Under McHugh's bill, which
has generated heated debate in Washington, the Postal Service also could offer
discounts to bulk mailers.
Supporters of the bill say that, without an
an overhaul of some sort, the Postal Service will probably die.
"Unless
we make real changes, the Postal Service will be faced with some pretty unsavory
options," said Dana Johnson, an aide to McHugh. "It will have to raise postal
rates to 50 cents, and it may be forced to close many of its 38,000 postal
offices, especially those in rural areas."
Competitor United Parcel
Service of America Inc. has come out against the measure. It maintains the bill
would give the agency an unfair competitive advantage.
USPS would become
a two-pronged organization. On one side, it would continue to operate with
certain government subsidies not available to private firms, including exemption
from sales and property taxes and from other business expenses such as tolls.
Although private entities established under the McHugh bill would not have
special perks, critics fear the government agency could use cost savings to help
launch the private firms.
The agency's biggest union, the 360,000-member
American Postal Workers Union, has been lobbying against the bill since McHugh
introduced it in the spring. "This bill is a vehicle for the privatization of
the US Postal Service and an attack on the collective bargaining rights of
workers," said spokesman Thomas Fahey. "It would cap postal rate increases and
that would translate into a cap on our wages."
By contrast, the
240,000-member National Association of Letter Carriers says it neither supports
nor opposes the measure. Instead, it has been working on a compromise with the
House subcommittee on the Postal Service, which McHugh chairs. "We'd like to see
the best piece of legislation developed, and hopefully that will be legislation
we can support," said spokesman Drew von Bergen.
In Brockton and several
other urban communities, workers have been up in arms. Von Bergen maintains that
letter carriers, concerned about extra work on delivery routes caused by
automation, took their complaints to an arbitrator and recently won a decision
that will raise wages for letter carriers nationwide.
While the Postal
Service says its changes have nothing to do with recent labor management
problems in urban areas, workers in Brockton don't see it that way. Locally,
postal workers are angry about the loss of light-duty assignments to workers
injured off the job.
"We could not continue to accommodate people on
light indefinitely," said Christine Dugas, a USPS spokeswoman. "In some cases,
we had people in [Brockton] who had been on light duty for years. By law, we
must accommodate people who are injured on the job, and we do. But we can't do
it for everybody."
That's no consolation to Robert Tynan of Brockton.
The 61-year-old mechanic has been out of work for months without pay. He says he
had knee replacements in April, but was hoping to return to work in 90 days. He
said he used up 698 hours of sick time and annual leave and was due to return to
work on Labor Day.
"When I came to work, I was told that the Postal
Service had no work with any accommodations," said Tynan, who is relying on a
savings account. "In fact, they said there was no such thing as light duty."
Tynan claims he was injured on the job several years ago but never
formally filed an accident report on the knee injuries. Under the Postal
Service's new policy on light duty, the absence of a formal report does not
qualify the accident as job related, Dugas said. That technicality, Tynan said,
leaves him in limbo.
GRAPHIC: PHOTO, 1. GLOBE STAFF
PHOTO/JONATHAN WIGGS/Robert Tynan of Brockton has been out of work for months.
2. GLOBE STAFF PHOTO/JONATHAN WIGGS/ Mechanic Robert Tynan says there was no job
for him upon his return from knee surgery.
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December 21, 1999 
