A new report from the Office of Inspector General at the Postal Service found that almost half of the agency’s employees had “unauthorized overtime” in fiscal year 2019 to the tune of over $500 million.
During the last fiscal year, the IG found that 263,694 of the Postal Service’s 633,108 career and non-career employees (42%) had what it labeled “unauthorized overtime.” Consequently, the IG estimates that the Postal Service incurred about $521.6 million in questioned overtime costs.
Between fiscal 2014 and fiscal 2019, USPS paid $25.8 billion in total overtime costs, with fiscal 2019 recording the highest payments out of those years. During the same time period, annual overtime costs increased from $3.7 to $5 billion (35%), while overtime hours increased from 98.9
to 129.7 million hours (31%).
The IG also noted in the report that it began its investigation prior to President Trump issuing a national emergency declaration for the COVID-19 coronavirus outbreak on March 13.
The IG said in its report that the problem occurred for a few reasons:
- Management did not always maintain adequate staffing levels
- The Postal Service’s current framework for measuring key performance indicators lacks a direct deterrent that would prevent management from exceeding their overtime budget.
- Headquarters management did not require supervisors and managers in the field to collect information on their reasons for overtime use. This would have provided analytical data to support the causes for exceeding their planned overtime and determine if they need to adjust their employee and operational schedules.
- Management did not provide adequate supervisory oversight of the timekeeping and overtime processes
While some overtime is required to manage workloads, the IG implied in its report that workloads were not necessarily the main cause of the rising amounts of overtime. The report states:
We found that the Postal Service needs to strengthen controls over managing overtime to successfully contain these costs. Although package volume grew, overtime costs and hours trended upward and consistently exceeded their planned overtime budgets from FY 2014 to FY 2019, despite declining mail volume and increased employee levels. Specifically, our audit found that several thousand employees earned more in total overtime than their regular straight time pay, and the Postal Service generally exceeded its planned regular and penalty overtime costs and hours during FY 2014 through FY 2019. In addition, management did not always effectively manage their unauthorized overtime or ensure they had complete, accurate, and reliable employee payroll workhour data.
As for how to solve the problem, the IG made these recommendations:
- Address staffing issues at facilities operating below their authorized complement or with excessive vacancies and identify opportunities for savings at locations with high overtime users by determining the optimal point at which hiring new staff becomes more cost efficient than using overtime.
- Modify current policies and procedures to include performance measures or other oversight controls to hold appropriate management accountable for not reducing overtime use.
- Implement a process to collect and monitor data that identifies the reasons for overtime use to better manage and control overtime costs.
- Develop an action plan, with milestones, to monitor and reduce unauthorized overtime.
- Establish and implement automated processes to update the data file parameters and validate the file for accuracy and completeness
Assessment of Overtime Activity – Report Number: 20-209-R20