e-Team Report, March 25, 2015

Pay More, Get Less
Postal Employee Retirements in the Crosshairs

This month, the House and Senate Budget Committees released their budgets for Fiscal Year 2016 and both contain severe hardship for federal and postal employees.  Among other harmful provisions, these recently unveiled budget bills call for significant increases in the amount federal and postal employees must pay into their retirements.  Under plans endorsed in the FY2016 congressional budgets, up to 6% of a postal worker’s wages would go towards retirement payments – reducing wages by thousands of dollars each year for the same benefits. In recent years, employee contirbutions under FERS have risen from 0.8% all the way to 4.4%, with further increases now being considered. 

“This is a blatant pay cut for postal workers,” said APWU Legislative and Political Director John Marcotte, “Congress can’t continue to balance the federal budget on employees’ backs.”  Over the past five years, lawmakers have already cut federal and postal workers pay and benefits by $159 billion – and now they want more.  While workers have seen budget after budget diminish their livelihoods in the name of austerity, these congressional proposals ask nothing of the wealthiest Americans.  Instead, the budget proposals advanced by House and Senate Republicans preserve and protect big tax cuts for America's richest few.

While the House and Senate budgets seek to increase employee retirement contributions, another new piece of legislation aims to cut the amount we receive in retirement benefits.  H.R. 1230, introduced by Rep. Bruce Westerman (R-AK), would “tweak” the way the federal retirement system calculates annuities.  Rather than average the highest three years of an employee’s salary, H.R. 1230 would take the average of the five highest years.  The net effect would be big cuts in how much federal and postal employees receive in retirement benefits.  According to the Congressional Budget Office, over ten years, the bill would take over $3 billion out of the pockets of retired workers.

APWU stands strong with its sisters and brothers in the face of congressional attacks.  “These pay and benefit cuts are the latest disrespect heaped upon the good working-class folks in federal and postal employment,” said APWU President Mark Dimondstein, “we reject these ugly attempts to turn ‘public service’ into dirty words and public servants into piggy banks.”

To read more about the House budget proposal, click here. For the Senate, click here.

To read more about H.R. 1230’s retirement cuts, click here.