Future of USPS Managers Incentive Pay Program Is Uncertain

The future of a controversial pay incentive program for senior U.S. Postal Service managers remains uncertain two days after closed-door discussions by the postal service’s Board of Governors.

Discussions about the controversial program, officially called the Economic-Value -Added (EVA) – Pay-for-Performance Program (PPP), which financially rewards senior managers for meeting productivity and cost-reduction goals, topped the agenda for the board’s private meeting.

According to the office of board secretary, David G. Hunter, “the governors talk about the issue every month and this month was no different.”

Neither the postal governors nor the postal service’s press department could not be reached for comment.

But sources close to the board told DIRECT Newsline that no decision had been reached on the future of the program, which was instituted in 1996 by then-Postmaster General Marvin T. Runyon.

The program drew the ire of postal workers on Internet postal chat rooms following a July 13 DIRECT Newsline report of a memo Postmaster Jack Potter sent to senior managers. The memo said senior managers could receive as much as 25% of their annual pay for meeting or exceeding productivity and money-saving goals.

Since then, some 200-odd angry postal workers have criticized the program and top postal officials on Internet message boards while just a few — less than a dozen — supervisors defended it.

One supervisor said he’d like to see the USPS scrap the EVA program and restore the previous system of cost-of-living adjustments (COLA’s) for managers. Another said he’d like to see a Congressional investigation of the entire program.

The program has also raised the ire of at least two U.S. Senators–Fred Thompson (R-TN) and Jeff Sessions (R-AL), along with Rep. Walter B. Jones (R-NC).

Amid reviews of the program by Thompson and Sessions, who are members of the Senate’s Government Affairs Committee, Jones introduced a non-binding resolution (H.Res. 144) which would prohibit the USPS from paying “productivity bonuses” to senior managers “in any year the USPS anticipates that it will operate at a deficit.” It also prohibits the bonuses in any year in which a “general increase in postal rates has been requested, gone into effect, or is likely to become effective.”

The USPS, which anticipates ending its fiscal year next month with roughly a $1 billion deficit, predicts that deficit will grow to $3 billion in fiscal 2002.

With Congress in recess until after Labor Day, no action on the measure, which has been referred to the House Government Reform Committee, is expected until sometime in the fall.