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Delivery Cost Containment Strategies

USPS. NALC. National Route Adjustment Process. Delivery Cost Containment Strategies. MTAC Meeting April 29, 2009. React to Unprecedented Volume Loss. Background. Ease Rate Pressure Through Aggressive Cost Reductions. DOIS. USPS Delivery Challenge:. Background. Background.

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Delivery Cost Containment Strategies

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  1. USPS NALC National Route Adjustment Process Delivery Cost Containment Strategies MTAC Meeting April 29, 2009

  2. React to Unprecedented Volume Loss Background Ease Rate Pressure Through Aggressive Cost Reductions DOIS USPS Delivery Challenge:

  3. Background

  4. Background

  5. React to Unprecedented Volume Loss Right-Size Our Delivery Route Structure City Carrier Route Adjustment Process National Rural Mail Count Background Ease Rate Pressure Through Aggressive Cost Reductions DOIS USPS Delivery Challenge:

  6. Alternate Adjustment Process USPS NALC Interim Alternate Adjustment Process A Joint USPS/NALC Agreement for an Expedited Route Evaluation and Adjustment Process Allows Swift Reaction to Unprecedented Volume Loss Quick, Simple Less Contentious Process Data Driven Jointly Administered Opportunity to Evaluate the Process & Potential to Continue. Original Interim Alternate Route Adjustment Process

  7. Alternate Adjustment Process USPS 90k Routes Were Jointly Evaluated From Oct thru Feb Adjustments Implemented January - March • Results From Original Process • 2,500 Routes Eliminated (2,700 FTER) • Annual Savings - $243M • Little to No Grievance Activity NALC • IARAP - Post Process Actions • Full Assessment / Evaluation of the Process • Adjust Process to Address Shortcomings • Seek NALC Agreement on Refined Process Original Interim Alternate Route Adjustment Process

  8. Alternate Adjustment Process USPS • Modified Interim Alternate Route Adjustment MOU • Agreement Signed on 04/07/09 • Replaces Original MOU Signed on 10-22-09 NALC Major Issues Addressed in New Agreement Startup Issues (Joint Team Formation) Formal Dispute Resolution Process More Representative Assessment of Street Time Clearance to Fully Utilize Carrier Optimal Routing • Scope of the New Agreement • 90k Routes Evaluated in Original Process • All (160k) Routes to be Evaluated Under the Modified Agreement Modified Interim Alternate Route Adjustment Process

  9. Alternate Adjustment Process USPS • Timeline • Evaluation Period – May Through June • Implement Adjustments – July Through August • Revisit Adjustments – September Through November NALC • Industry Impacts • Potential for Widespread Addressing Changes • Implementation Schedules Posted on RIBBS Website • Need to Refresh Sequence and Route Information Accordingly Modified Interim Alternate Route Adjustment Process

  10. Alternate Adjustment Process USPS SERVICE Greater Consistency of Delivery NALC COSTS Facility Space Delay/Eliminate the Need for Career Hires EMPLOYEE SATISFACTION Employee Morale Easier to Manage REDUCED CARBON FOOTPRINT Vehicle Mileage/Fuel Reductions Residual Benefits of Rt Reductions

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