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USPS Offers Employees Resignation Bonus

By Neetal Parekh on August 26, 2009 | Last updated on March 21, 2019

The U.S. Postal Service announced this week that it is offering up to 30,000 employees a $15,000 resignation bonus to leave their jobs.  The initiative would cost the USPS $450 million but could save another $500 million over the next fiscal year.   

Trimming back and going lean.  It's like the Atkins diet, for the post office. 

And this no-carb plan offers participating employees an initial payment of $10,000 in the coming October followed by $5,000 in October 2010.  Desk clerks, distribution center mail handlers and clerks, and motor vehicle technicians are eligible for the resignation bonus program.  And they have until September 25th 2009 to decide.

The slow economy is not the only factor that has motivated the slimming measures.  With increasing online and electronic communications, the USPS has already been experiencing a steady decline in mail deliveries.  That decline paired with advances in technology, automating more aspects of the postal collection and sorting process, have created the need for fewer employees.  In the current year alone, mail volume has dropped 12.6 percent.  And if a $2.4 billion third-quarter loss wasn't difficult enough news, the projection of $7 billion as the total year's loss gives perspective for the job eliminations.

The resignation bonus is one of several cost-lowering efforts that also involved closing 300 post offices across the country, cutting over 100 million work hours, and mandating hiring and salary freezes for top executives. 

The USPS negotiated the plan with workers unions, American Postal Workers Union and the National Postal Mail Handlers Union. 

The success of the plan will be telling.  If it meets a positive response, it could spark a re-emergence of the USPS---perhaps a leaner, greener machine equipped to adapt to the country's changing needs.  And a best-case scenario for resignation bonuses in the Post Office could serve as a catalyst for other similar incentives in other government agencies.  


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