Legislative & Political Dept.
The Need to Block S. 1507
Legislative & Political Department Director
(This article appeared in the September/October 2009 issue of The American Postal Worker magazine.)
An amendment adopted by a Senate committee July 29 rendered unacceptable a bill to provide temporary financial relief to the cash-strapped Postal Service.
The amendment to the Postal Service Retiree Health Benefits Funding Reform Act of 2009 (S. 1507), offered by Sen. Tom Coburn (R-OK), would require arbitrators ruling on postal contracts to take into account the financial health of the Postal Service.
Arbitrators routinely consider the Postal Service’s financial status as part of the context in which negotiations are conducted, but to attach this specific requirement to the law leaves workers at a severe disadvantage during collective bargaining.
Under the Postal Reorganization Act of 1970, we yielded our right to strike in exchange for the promise of free collective bargaining with binding arbitration. We feel that there’s no middle ground, that collective bargaining is either free or it isn’t. Sen. Coburn’s amendment would put a thumb on the scale for management during contract deliberations.
We are deeply disappointed that senators Tom Carper (D-DE) and Joe Lieberman (ID-CT) supported this anti-labor amendment, and voted with committee Republicans for its adoption.
Until the amendment was included, the bill was similar to H.R. 22, which was unanimously approved by the House Oversight and Government Reform Committee on July 10. Both S. 1507 and H.R. 22 would modify a provision of the Postal Accountability and Enhancement Act of 2006 (PAEA) that requires the Postal Service to prefund the healthcare benefits of retirees from its operating budget: Something no other federal agency is asked to do.
The legislation we supported would allow the Postal Service to pay a portion of the retiree healthcare benefits from the Postal Service Health Benefit Fund for Fiscal Years 2009, 2010, and 2011. It was expected that the legislation would save the USPS more than $2 billion per year, and, as supporters of H.R. 22 pointed out, the relief would come without a single dollar of taxpayer money being spent. (With 338 co-sponsors, passage in the House seemed to be a certainty.)
We fully support the original intent of S. 1507, which was to provide desperately needed short-term financial relief to the Postal Service, but the Coburn amendment will have a crippling effect on our collective bargaining process. Adoption of the amendment leaves us no choice but to oppose the bill. We are asking our members to do everything that can be done to defeat this measure. President Burrus has said that we need to generate 50,000 contacts from postal employees to U.S. senators.
FERS Sick-Leave Measure Dies in Senate
The drive to win sick-leave credit for postal and federal workers covered by the Federal Employees Retirement System (FERS) was revived June 25 when the House of Representatives included the benefit in the 2010 Defense Authorization measure. The bill was approved in the House by a vote of 389-22, and was sent to the Senate for consideration.
The measure would have granted FERS employees credit for unused sick leave when calculating their retirement annuity. Employees covered by the Civil Service Retirement System (CSRS) already enjoy this benefit.
When the bill was debated on the Senate side, Sen. Coburn filibustered until the FERS sick-leave provisions and territorial-pay provisions for Alaska, Hawaii, and American possessions were stripped from the bill. After hours of prolonged debate, Sen. Daniel Akaka (D-HI) reluctantly agreed to remove the provisions from the defense bill.
Earlier in the month, these same provisions were stripped from the Senate version of the Family Smoking Prevention and Tobacco Control Act. It is clear that Senate Republicans are determined to prevent FERS employees from getting credit for unused sick leave when they retire as well. Provisions denying territorial pay compensation for postal and other federal workers also were dropped. We are determined, however, to continue to fight for these changes.
Changes to Thrift Savings
The Tobacco Control Act also contains some important benefits that will have positive effects on the Thrift Savings Program (TSP).
The TSP will soon allow its participants to put after-tax money into a Roth option. Since taxes would have already been paid on this money, the effect will be that when the funds are withdrawn, they will be tax free. The current investment option allows people to put pre-tax money into their account, which defers the tax obligation until the money is withdrawn. The new Roth after-tax option is expected to be available to postal, federal and military TSP contributors sometime in 2011.
Another change to the TSP would be the elimination of the six-month waiting period for the government to make matching contributions. Under the new rules, matching TSP contributions begin immediately.
Additionally, survivors of postal and federal employees and retirees will be allowed to keep TSP-account money in 401(k) plans. Under current rules, survivors must move that money out of the TSP into funds that charge higher administrative fees and do not offer the same safety.