USPS to Make First-Class Delivery Cuts in Spring; Could Affect Netflix, Gamefly
December 5, 2011 1:25 PM
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Postmaster General Patrick Donahoe
The U.S. Postal Service plans to slow first-class mail delivery and close 250 mail processing centers come March
The U.S. Postal Service has announced that it will make about $3 billion in reductions next spring in order to climb out of the red, which is expected to affect first-class mail delivery and those who use it such as Netflix and
After five years of being in the red, the U.S. Postal Service is taking action to reduce costs while waiting for Congress to allow it to raise stamp prices, reduce health care/labor costs, and reduce delivery to five days per week.
Despite having to wait on Congress for such larger aspects of authority regarding cost reduction, the U.S. Postal Service is an independent agency of government that does not receive tax money, thus enabling it to make smaller-scale decisions of its own.
U.S. Postal Service
has decided to make its cuts in first-class mail delivery, which will slow delivery and eliminate next-day USPS delivery.
First-class mail is currently delivered to homes and businesses within one to three days in the continental U.S. Forty-two percent of first-class mail arrives the following day while 27 percent arrives in two days and 31 percent arrives in three days. Less than 1 percent arrives in four to five days. With the cuts in progress taking place, 51 percent of first-class mail would arrive in two days while much of the remainder would arrive in three days.
In addition to slowed mail delivery, 250 mail processing centers and 3,700 local post offices will close if the cuts are finalized, which would eliminate about 100,000 postal employees. This would save the U.S. Postal Service $6.5 billion annually.
These changes are currently awaiting advisory opinion from the independent Postal Regulatory Commission in March 2012, but Postmaster General Patrick Donahoe has said that the cuts are urgent and will be put into action come March after the opinion is released.
The U.S. Postal Service is expected to have a loss of $14.1 billion next year. According to Donahoe, it must make $20 billion in cuts by 2015 in order to climb back into the black.
The U.S. Postal Service has already made a few announcements in regards to changes, such as a 1-cent increase in first-class mail to 45 cents starting January 22. It also announced in September the possibility of closing the processing centers, and it received 4,400 public comments where many opposed the idea. State legislators and small-town mayors were on the list of opposition, while companies like AT&T strongly urged the U.S. Postal Service to educate the public about any changes so that there is no confusion or delinquent payments when it sends its monthly billing statements. DVD-by-mail
companies like Netflix and Gamefly
will also be affected, since these services depend on timely DVD delivery. Customers will likely cancel such services if they feel they are not getting their money's worth.
"DVD by mail may not last forever, but we want it to last as long as possible," said Netflix CEO Reed Hastings.
Many who oppose the U.S. Postal Service's approach say that these cuts will likely make its situation worse by pushing customers to internet services instead such as online bill payment.
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RE: Need to make cuts.
12/7/2011 9:13:53 AM
There really are only two choices:
1. Allow sick time to accumulate (basically a reward for not being ill, or a cushion in case of serious injury/illness); or
2. Cap sick time, which limits expenses on that end but guarantees that every employee with 2 brain cells will miraculously get "ill" rather than lose those hours.
My last company had something worse; no sick time limit at all, but part of your pay depended on being "100% billable" which means on the job or using annual. Missing even one hour meant three months of the 'bonus.' Therefore, nobody could afford to take any of their unlimited sick time!
RE: Need to make cuts.
12/7/2011 5:20:32 PM
Those aren't the only two choices.
My employer doesn't offer sick time, or really vacation time for that matter. It's all rolled up into Personal Time Off (PTO). The yearly PTO we get is roughly the going vacation rate + half the going sick time rate, or more specifically, 3 weeks a year for new employs, plus 1 week for every 5 years of employment up to a max 6 weeks a year at 15 years of employment. There's also no annual cutoff, but a cap equal to 1.5 times your anuual accumulation (9 weeks total at 15 years). You accumulate PTO with each paycheck, at a rate that is your yearly PTO divided by 26 (we get paid bi-weekly)
There are no penalties or bonuses associated with anything. If you hit your cap, you stop accumulating until you take some of it off. If you're somebody that gets sick a lot, it may not be an ideal plan for you, but for somebody like me that sometimes goes several years without taking a sick day, it's all just extra vacation time. I keep my accumulated PTO at around 4-5 weeks as well (maybe let it accumulate up to 6-7 weeks if I'm planning a long vacation or multiple near future vacations)
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