WASHINGTON — The U.S. Postal Service and its two largest unions reached a tentative contract settlement Tuesday, giving workers average wage increases totaling between $1,700 and $1,866 over the next 40 months.
The agreement was reached in an all-night bargaining session. The union contract had expired at midnight Monday, but the 580,000 affected workers remained at their jobs as the talks continued.
Postal strikes are banned by federal law, and a complex arbitration process could have followed had no agreement been reached.
The settlement was announced at a joint news conference by Postmaster General Preston R. Tisch and Presidents Moe Biller of the American Postal Workers Union and Vincent R. Sombrotto of the National Assn. of Letter Carriers.
Biller said that the agreement resulted in wage increases totaling about 7% over 40 months, through Nov. 20, 1990, starting with an immediate 2% increase. It contains a cost-of-living clause, giving union members about 60% of the increase in the Consumer Price Index.
In addition, the contract calls for increases of $250, on an annual basis, in July, 1988, and January, 1989, with $300 increases in July, 1989, and January, 1990, and a final $200 raise in July, 1990. Currently, annual pay for postal clerks and letter carriers ranges from $20,094 to $27,089, not including benefits.
Including about $5,000 in annual fringe benefits, the Postal Service estimates average compensation for workers in those groups at about $30,000.
The Postal Service dropped its demand for an increase in the number of so-called casual workers, part-time employees who receive lower pay and benefits and are often used during periods of peak business.
The use of casuals had been a sticking point in the discussions, with the unions fighting to prevent any increase.
Swap Was Proposed
The Postal Service had offered the unions a series of choices in which they could swap pay increases for allowing use of more casuals, in an attempt to stay within its budget.
The government proposal had been based on expected income, including a planned increase in stamp rates next year, raising first-class postage to 25 cents from 22 cents.
When asked who won in the bargaining, Sombrotto responded: "Everybody won, especially the American public."
Tisch added: "We think it's a good contract for the United States Postal Service and the American people."
Sombrotto characterized the marathon bargaining sessions as "long, torturous, burdensome and sometimes very tiresome."
Biller announced in a taped message to his union members Tuesday that an agreement had been reached and was being sent to local leaders for their approval, but the details were not confirmed until several hours later.
Biller and Sombrotto said that their bargaining committees had approved the settlement and that it was being sent to local members for ratification.
Initially, the postal workers and letter carriers unions had sought a 6.8% annual pay hike in a three-year contract. They reduced that request to 4.5% annually on Sunday.
The Postal Service had offered a series of wage and benefit packages that union officials estimated as amounting to pay increases of about 1.6% annually. The offer had provisions for the unions to trade salary gains for trade-offs on the use of casual workers.
The 1.6% hikes would have matched the contract announced last week with the 50,000-member Mail Handlers union, which signed for 36 months.