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Tuesday May 26th, 2015 3:48AM

Postal Service, union wrangle over Staples outlets

By The Associated Press
WASHINGTON (AP) -- The opening of Postal Service retail centers in dozens of Staples stores around the country is being met with threats of protests and boycotts by the agency's unions.

The new outlets are staffed by Staples employees, not postal workers, and labor officials say that move replaces good-paying union jobs with low-wage, nonunion workers.

"It's a direct assault on our jobs and on public postal services," said Mark Dimondstein, president of the 200,000-member American Postal Workers Union.

The dispute comes as the financially struggling Postal Service continues to form partnerships with private companies, and looks to cut costs and boost revenues. The deal with Staples began as a pilot program in November at 84 stores in California, Georgia, Massachusetts and Pennsylvania as a way make it easier for customers to buy stamps, send packages or use Priority and certified mail.

Postmaster General Patrick Donahoe said the program has nothing to do with privatization and everything to do with customer service and driving up demand for the agency's products.

"The privatization discussion is a ruse," Donahoe said in an interview. "We have no interest in privatizing the Postal Service. We are looking to grow our business to provide customer convenience to postal products."

Staples spokeswoman Carrie McElwee referred questions about union concerns to the Postal Service. She said the company "continually tests new products and services to better meet the needs of our customers."

Union leaders fear that if the Staples program is successful, the Postal Service will want to expand it to more than 1,500 of the company's other stores. That could siphon work and customers away from nearby brick-and-mortar post offices, taking jobs from postal workers and even leading traditional post offices to close.

Union leaders have been visiting Staples stores to meet with managers, asking them to share the union's displeasure with upper management.

Dimondstein asked to meet with the Staples CEO Ronald Sargent, who has declined.

The union plans to hold "sustained" protests this month at Staples stores in the San Francisco and San Jose, Calif., area that would be expanded elsewhere. Union officials also are considering how they can exert pressure on Staples shareholders.

"If Staples insists on continuing to refuse to staff those stores with postal workers, we're going to urge people to take their business elsewhere," Dimondstein said.

The union says it's not asking to shut down the program. It wants the counters to be run by postal employees, not workers hired by Staples. The average postal clerk earns about $25 an hour, according to the union, plus a generous package of health and retirement benefits. The Staples post office counters are run by nonunion workers often making little more than the minimum wage.

The Postal Service increasingly has looked to work with the private sector to help increase business. In November, it announced a lucrative deal with Amazon to begin package delivery on Sunday.

The agency has struggled for years with declining mail volume, but the lion's share of its financial plight stems from a 2006 congressional requirement that it make annual $5.6 billion payments to cover expected health care costs for future retirees. It has defaulted on three of those payments. The Postal Service lost $5 billion over the past year, though operating revenue rose 1.2 percent.

So far, the Postal Service has rebuffed the union's demands.

As far as who will staff the counters, "that's Staples' business. They make their own business decisions and it has nothing to do with us," Donahoe said.

Donahoe said he'd like to see post office counters in every Staples store "as soon as possible." But he doesn't see them as replacing any of the 33,000 traditional post offices. He said he sees the program as an opportunity "to grow the business."

James O'Rourke, a professor of management at the University of Notre Dame, said the Postal Service is simply following the trend of other businesses such as banks and medical clinics opening in grocery and drug stores to get more customers and save overhead costs.

"You can't blame the union for looking suspiciously at this move, but from the perspective of postal management and postal customers, this is all good," O'Rourke said.

Donahoe acknowledged that it could save money in employee costs, but insisted that is not the agency's motivating force. Since 2008, the Postal Service has reduced its employees by more than 200,000, mainly through attrition.

"Keeping our expenses down is no different than what any other business would do," he said.

Back in 1988, the Postal Service tried a similar plan to put retail units in Sears stores in Chicago and Madison, Wis. APWU members picketed Sears headquarters in Chicago, mailed thousands of letters of protest to then Sears Chairman Ed Brennan and even cut up their Sears credit cards.

The pressure worked and a year later the program ended, with Sears saying it did not want to be at the center of a dispute between the Postal Service and the union. But the APWU's membership now is almost half of what it was 25 years ago, and unions don't carry the same clout they once did.

Dimondstein, who took the helm of his union in November and pledges a more activist approach, insists his members will bring considerable pressure on Staples.

"I think we have a lot of clout," he said. "We're in every hamlet, town, city and state in the country."
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