Except as otherwise provided in this section, whoever, in any matter within the

jurisdiction of the executive, legislative, or judicial branch of the Government of

the United States, knowingly and willfully - (1) falsifies, conceals, or covers up by any trick, scheme, or device a material fact; (2) makes any materially false, fictitious, or fraudulent statement or representation; or (3) makes or uses any false writing or document knowing

the same to contain any materially false, fictitious, or fraudulent statement or entry; shall

be fined under this title, imprisoned not more than 5 years or, if the offense involves

international or domestic terrorism (as defined in section 2331), imprisoned not more

than 8 years, or both.⁹  
 

On June 11, 2009, a law firm in Texas filed a class action lawsuit against the Postal Service seeking damages under the Federal Fair Labor Actions Acts for the class members who allegedly had: 1) overtime payment disallowed, 2) time changed by a supervisor, 3) worked through their lunch breaks, 4) worked off the clock, 5) and/or worked overtime and were not paid.¹⁰ The lawsuit covered letter carriers working in the state of Texas, Louisiana, Arkansas, Oklahoma, and New Mexico. In the suit, it was further alleged that through policy implemented at postal headquarters and then filtered down through regional vice-presidents and ultimately to postal delivery units, the city letter carriers were routinely and knowingly were refused monetary compensation for actual time worked. In addition to the preceding, prime example of extensive time and attendance fraud, one other significant case is briefly discussed below.  

In Milford, New Hampshire, on December 23, 2009, an arbitrator ruled that city letter carriers were repeatedly and flagrantly victims of time and attendance discrepancies.¹¹ The arbitrator awarded in excess of $25,000 to the grieved city letter carriers. Prior to the arbitration, at the request of U.S. Representative Paul Rhodes, the USPS OIG conducted an investigation and later concluded that three managers at the two postal installations in Milford manipulated time sheets causing employees to be underpaid.  

After the arbitrator’s decision, the NALC Branch 44 president indicated that the managers who committed the time fraud (i.e., altered employees’ clock rings and thereby defrauding them of entitled compensation) were not disciplined and were still supervising employees who were defrauded.¹² He reportedly called the situation a disgrace. The president further noted that the union filed another grievance because after ninety days postal management refused to comply with the arbitrator award and pay for the grieved employees.¹³ The union also said it has filed an unfair labor practice with the Department of Labor because of lack of compliance for requested documentation from postal management.¹⁴ 

Please note these specific examples of time and attendance fraud are by no means inclusive of what has transpired and ostensibly is still transpiring within the Postal Service. These fraudulent practices are not isolated events: They are reported to be occurring across postal facilities throughout the country.  Incidences of time and attendance fraud in New York and North Carolina, for example, have been reported. This nefarious practice of deleting letter carriers’ overtime may have contributed to the suicide in Gastonia, NC in June 2009.¹⁵ These occurrences mixed with other unethical practices and toxic management styles contribute to toxic workplaces and workplace violence.  

It is important to note in virtually all the cases of which I have become aware, regarding the issue of time and attendance fraud, it was reported that USPS OIG did not conduct an investigation unless it specifically was requested by a congressional representative. Similarly, I am aware of no occurrence where a case of time and attendance fraud was treated as a crime or forwarded for criminal prosecution.  In most cases, those postal management officials, who reportedly committed these fraudulent acts, ostensibly were following the tacit directions of their “superiors” and were still allowed to supervise and manage the employees that they defrauded of their due momentary compensation. 

Question: Has the national postal unions’ national representatives, especially the NALC, aggressively cataloged all known and purported instances of fraudulent time practices and then consistently and resolutely addressed them with key top postal management executives, members of the Board of Governors, Secretary of Labor, and key postal congressional committees’ and subcommittees’ members? If not, why?  

If the answer is no, I believe this inaction or failure contributes to the toxic workplace environments festering at postal facilities across the country and to a more violent-prone organization. As national union representatives, they have an obligation and an affirmative duty to it members to stalwartly represent their interest not only in pay and job duties, but in problematic workplace issues that serve to undermine the health and well-being of their members as well. 

Finally, why has not the United States Department of Justice investigated these ostensible systemic illegal and fraudulent time changing practices of postal management and its apparent condoning by top postal management and the USPS OIG?  
 
Example 3:  NAPS and Pay for Performance 

On January 30, 2010, the National Association Postal Supervisor (NAPS) president notified key Senate and congressional leaders that the Postal Service was likely to reduce the agreed upon pay for performance compensation, amounting between $500-$800 for many of the 75,000 affected employees from the ranks of supervisors, managers, and postmasters.¹⁶ The NAPS president indicated that this might have occurred because the Postal Service arbitrarily and unilaterally changed the performance targets of the employees that were agreed upon through the negotiated pay agreement by the three management associations and the Postal Service.¹⁷  

In his communication, the NAPS president indicated that his members were aware and concerned about the financial condition of the Postal Service. He further appropriately noted, however, that this did not prevent top postal management from awarding many of its executive rank salary increases amounting to ten of thousands of dollars for meeting pay-for-performance targets for the past year. 

It is commendable that the NAPS president had taken this important issue to key congressional leaders with postal oversight. However, as you will see in the next example, there appears to be a serious failure of leadership in dealing with a far more serious issue than concerns about pay-for-performance for its members.  

Example 4: Unethical Sales Incentive Program and Immoral Sales Reorganization 

      Unethical Sales Incentives 

The sales unit within the Postal Service is comprised of about six hundred sales employees, and they are dispersed primarily at postal districts and regional areas offices. These sales representatives contribute between 70-80 percent to the generation of yearly commercial revenue of the Postal Service amounting to approximately 70 billion dollars.   

After being brought to USPS OIG’s attention in early 2007 that top executive and managerial leaders of the sales department used unethical sales incentives and practices, they reportedly did not conduct a formal investigation until February 2008.  A NAPS representative informed me that this report was supposed to be available to NAPS in December 2008, but was not released to a NAPS representative until spring of 2009 because of a Congressional request and finally was listed on their website in April 2009.¹⁸ 

The unethical sales incentives investigated by the USPS OIG included the Sales Compensation Incentive Plan (SCIP) for the 600 plus sales representatives from fiscal years 2005 through 2008.¹⁹ The SCIP was in addition to the annual Pay for Performance (PFP) plan for these same employees. It is important to note that both the SCIP and PFP plan were not tied to unit goals or corporate goals as were all other management employees in the Postal Service for the fiscal years 2005-2008.  

In its investigative report, the USPS OIG concluded: “[T]rends for the Postal Service’s performance incentives for Sales employees were not comparable

to . . . trends and incentives at other organizations and did not align with overall business results.  Finally, managers awarded incentives to Sales employees based on revenue that did not result from their sales efforts.”²⁰ Three pertinent questions arise from this conclusion, which include:  

1. What were the differences between performance plan incentives for Sales employees compared to other organizations?
2. What is meant by the performance plan incentives that were not aligned to business results?  
3. What is meant by Sales employees being awarded incentives that were not based on revenue resulting from their sales efforts?

As for question one, the difference between performance plan incentives for USPS Sales employees and that at other organizations was obscenely disproportionate. For example, the USPS OIG noted for the 180 corporations compared to the USPS Sales employees, its employees received a 2 ½ percent increase in incentives bonuses based on a 6 percent increase in revenue. In comparison to these employees in the same four-year time period, the Postal Service Sales employees saw their performance bonuses increase by two hundred and ninety-two percent while revenue growth was flat. Bonuses received by Sales employees (including regional managers), amounted to payouts from 2005-2008 of 3.4 million dispersed in 1,406 individual payouts.²¹ The USPS OIG found that only a small number of the 600 or more Sales employees received these payouts each of the years reviewed. For example they found: 

• 48 employees received payouts in all 4 years. Of these 48 employees,

             only 23 received a total payout greater than $10,000 for all 4 years.

• 173 employees received payouts in 3 of the 4 years.
• 207 employees received payouts in 2 of the 4 years.
• 291 employees received a payout in just 1 of the years.

It is also important to note that payouts to Sales regional managers jumped from $10,000 to 30,000 from fiscal year 2005 to fiscal year 2008, a three hundred per cent increase in potential payouts (see chart below as provided in subject USPS OIG report).²² 
 
Maximum Incentive Payouts for Postal Service Sales Employees 

                         FY 2008  FY 2007  FY 2006  FY 2005

Sales Force    $15,000  $5,000   $5,000   $5,000

Sales Managers   $20,000  $7,500   $7,500   $7,500

Manager, Major Accounts  $25,000  $10,000  $7,500   $7,500

Regional Manager, Sales  $30,000  $15,000  $10,000  $10,000 
 

For FY 2008, the USPS OIG reported specific incentive payouts to sales employees as follows: 

6  payouts totaling   $110,750

9  payouts totaling   $157,250

8  payouts totaling   $120,225

8 payouts totaling   $103,675

12 payouts totaling   $131,850

26 payouts totaling   $234,400

28 payouts totaling   $192,875

62 payouts totaling   $302,475

88 payouts totaling   $264,925

194 payouts totaling $187,300

441 payouts totaling $1,810,325 

Note: The payouts for FY 2008 were well over half of the 3.4 million dollars in incentive payouts for Sales employees from FY 2005 thru FY 2008.²³ 

These obscene payouts are particularly disturbing when viewed in the context that revenue generation was significantly below projections for these years. In fiscal year 2008, for example, there was no increase in commercial revenue despite record incentive payouts to Sales employees.  As such, it is clear that these payouts were not based on or aligned with business results. It is also disturbing, as previously mentioned, that this group of Sales employees also had a separate annual pay for performance system from the incentive payouts that compensated them based on individual results rather than identified unit or corporate results. 

What is most troubling regarding these payouts to Sales employees is that they were based ostensibly on fraudulent accounting practices or, at minimum, highly unethical accounting practices. More specifically, as noted in the USPS OIG report: “[M]anagement awarded performance incentives to Sales employees based on revenue generated by their assigned accounts. The plan did not consider whether there was a correlation between the revenue generated and the Sales employees’ effort.”²⁴ Although the USPS OIG provided several examples to support this conclusion, based on additional information provided to me by a management association member of NAPS, the most egregious accounting practices by Sales employees to inflate sales numbers include the following:

• Double reporting in CF and BCDC
• Moving customers to PC postage and call it a “sale”
• Standing in post office retail lobbies and on postal docks to make a “sale” that would occur without their presence
• Flat Rate "opportunities" encouraged by management to be manually put in on the USPS website by sales employees- providing the ability to "sell" on paper to current users of USPS.
• ‘Customer Connect’ leads inputted manually by Sales employees in BCDC to artificially increase leads, increase “sales”, increase “close/sales” ratio, (rationalizing it is to provide the product breakdown), which makes it impossible to compare to SPLY and other districts, and pads the real numbers. It also provides an erroneous impression of carrier involvement in the program since we are inputting for them in their name, and jeopardizes the relationship of the craft and the union agreement for participation in this national program through this outright forgery of a lead document.

As reported to me, these practices became commonplace and were under the “radar screen” because there was a lack of definition of “core goals” for Sales employees. There were no clear definitions for what was a “visit,” “opportunity,” or “sale,” but compensation was nevertheless tied to these goals. In this light and in context of the four years of a flawed bonus incentive payout plan, one NAPS member noted the following:

This ongoing manipulation of data and outright falsification of information results in the USPS being left with inadequate accurate information to guide it in making necessary management decisions for operations, delivery, employee retention, and plant closings, since revenue and income will be vastly overstated.  The current situation, at a minimum, will result in inefficiencies and additional wasted monies. . . . While other functional areas of operations and delivery get investigated for omissions, mistakes and “fixing” numbers, in Sales they get promoted for fraudulent behavior and falsification. In Retail Operations, if an employee or manager misstates revenue, it can be grounds for seizing paychecks, suspension, or dismissal.  With bonuses paid under the Sales compensation plan, it was tantamount to stealing Postal funds in the same manner as the employee who “borrows” from the till.  Either situation is the same: the employee took Postal funds to which they were not entitled.  

Not only did this ostensible flawed and illegal accounting for determining incentive award payouts create inadequate information for the Postal Service in its management planning efforts and unwarranted compensation to Sales employees, it also created toxic workplace environments for many of the Sales employees dispersed across the country. Sales employees who were not liked by their managers, or who did not go along with “gaming the system” (i.e., a shell game of literally moving the same revenue around to create the impression of new revenue) for incentive payouts, reportedly became targets before and during the Sales reorganization that transpired in 2009. Many of them did not receive any compensation payout either under the Pay for Performance plan or under the bonus incentive driven plan, some for all four years. They also were unfairly targeted for disciplinary actions and thwarted from training opportunities and promotions. Some were demoted or resigned because of the stress. Others developed serious mental and physical health problems and endured the situation because they needed the job to support their families. 

Interestingly, as one NAPS member informed me, the Postal Service utilized a high level manager as its designee to address all EEOs, disciplinary actions and promotional issues for all Sales employees across the country. Reportedly, this designee flew all across the country to handle these issues. It was further explained that this unique process to handle Sales Unit employees concerns and complaints served to keep volatile issues in Sales ‘internal,’ which placed the employee at a disadvantage for standing up for himself or herself, and thereby maintain the status of a covert, and ostensibly fraudulent incentive payout system.    

After consulting with several NAPS members and careful reading of the USPS OIG investigative report²⁵ on the subject flawed bonus incentive program, the OIG did not document purported illegal activities of managers and some of their subordinates, with regard to fraudulently obtained compensation based on nefarious accounting practices. There is no evidence to indicate that they followed-up on this issue subsequent to the investigative report. There is also no evidence that USPS OIG addressed or followed-up on the toxic workplace environment that these practices created for many of the Sales employees. The appropriate congressional committees and subcommittees need to look into this “whitewash” as well as the Department of Justice. Additionally, I believe that NAPS headquarters representatives were woefully inadequate in addressing the issues affecting the Sales employees who they represented during the past several years and this contributed to a toxic workplace environment for some of these employees.    

      Immoral Sales Reorganization 

In 2009, the Postal Service conducted another reorganization of its Sales unit. In doing so, many of the employees who did not fair well under the previous Sales organization in terms of “playing the shell game” and for whistle blowing activities were reportedly denied opportunities for similarly situated positions in the new structure. The interview system utilized reportedly was seriously flawed and this allowed selecting officials unfairly to “weed out” these employees. And to make matters worse, even after NAPs headquarters was assured differently, not all existing Sales employees were placed in the new structure. Some Sales employees ended up taking the early-out retirement opportunity or demotions to new positions under duress because selecting managers reportedly indicated to them that they would not be placed, or it was uncertain if they would be placed,  or it was unknown in what city they would be relocated. 

Sadly, even though NAPS headquarters was advised by top postal management that all Sales employees would be placed into the new structure back in November 2009, in January 2010 some of the “unplaced” Sales employees were placed in a non-duty, non-pay status. This is the first time to my knowledge that postal employees were not placed into positions when there were similarly situated positions available. In addition to the reasons previously noted, there were speculations that some affected employees were not placed because Sales managers were reserving available positions for applicants outside of the Postal Service. In support of this speculation, in January 2010 the Postal Service began advertising sales positions to outside applicants.  

The recent reorganization of the Sales unit is at a minimum an immoral example of change management within an organization that serves to undermine its employees and their families as well as employee commitment to the organization. It has increased the levels of preexisting toxic workplace environments for Sales employees. The consequences of these unnecessary workplace toxins have served to create serious physical and emotional symptoms for the affected employees. These actions also create the context for workplace violence, including job-related suicides. 

Throughout the Sales reorganization, NAPS headquarters appeared to have inadequately represented and demonstrated little concern for these employees. To make matter worse, Sales employees were informed in March 2010 that they no longer had the option of deciding what individual would represent them in a disciplinary action or other career concerns because NAPS and postal headquarters entered an agreement that prevents them to do so. This agreement was purportedly entered voluntarily by NAPS headquarters despite that it is contrary to the USPS’s Employee and Labor Relations Manual (ELM), which specifies all employees have the right to select representatives of their choosing. Accordingly, all NAPS members need to be concerned when gross injustices are inflicted on a sub-group of its population and their national representatives are appearing not to represent them in good faith. 

NAPS needs to be proactive in dealing with congressional committee members who have oversight responsibilities of the Postal Service, especially regarding how the Postal Service continues to create intolerable and toxic working conditions for many of the employees they represent. To not actively and consistently pursue and engage in this targeted action is a clear dereliction of duty and contributes to toxic workplaces for the employees they are obligated to represent.       

Example 5: Violation of Contractual Agreement with NALC 

In an agreement between the National Association of Letter Carriers (NALC) and USPS in 2007, they agreed upon three major points regarding the Delivery Operation Information System (DOIS), including: 1) DOIS is a management tool for estimating a carrier’s workload, 2) DOIS projections are not the sole determinant of a carrier’s leaving or return time, or daily workload, and 3) management is responsible for accurately recording volume and other data in DOIS.²⁶  

Despite the above-noted agreement, on September 24, 2009, an arbitrator sustained grievances filed by the NALC local in Shawnee, Oklahoma. In doing so, the arbitrator ruled that the “Postal Service improperly utilized the Delivery Operations Information System (DOIS) figures to set the carriers’ leave and return times in violation of the national agreement.²⁷ In addition, the arbitrator ruled that the improper use of the DOIS figures created a hostile work environment for the carriers.  

This is just another sad example of postal management taking unilateral action in violation of agreements between the Postal Service and postal unions. It makes one wonder why higher level management did not step in resolve this grievance before it reached arbitration. The agreement between the USPS and the NALC, as noted above is unequivocal. When agreements like this are violated, the morale of the employees is seriously affected. Accordingly, the arbitrator rightly concluded from the testimony and documents submitted that the Postal Service created a hostile workplace by its decision to ignore the DOIS agreement.²⁸  

Example 6: Elimination of Workplace Environment Analyst Positions 

For 15 years, the USPS Workplace Environment Analyst (WEA) was a key player, at the postal district level, in the prevention of workplace violence and overall improvement of the workplace environments at facilities throughout the Postal Service. Sadly, in July of 2009, these positions were eliminated. The history and relevancy of the WEA positions in preventing workplace violence is discussed herein.  

The position of WEA position was created during the massive restructuring of the USPS in 1992-1993. Initially, the position was not planned. The impetus for creating the position was related to the numerous postal workplace shootings in the 1980s and the early 1990s as well as congressional investigations, hearings, and inquiries. According to the information shared with me from a postal headquarters official, immediately after the two-workplace shootings on May 5, 1993, several postal executives and an outside consultant convened to develop a job description to address workplace violence and its prevention, change management, and the postal culture. 

In 1993, the position was titled “EAP Coordinator” and later changed to “Workplace Improvement Analyst”. In the beginning, there were 85 Workplace Improvement Analysts selected, one for each postal district. Interestingly, these new positions were implemented at a time when 36,000 management positions were eliminated. This was part of the commitment from postal management at the time to deal seriously with the issues of workplace violence and its prevention. Beginning in November 2007, the position title was changed to “Workplace Environment Analyst”. Prior to this position title change in November 2007, the position reported directly to the Manager, Human Resources at the District. 

Currently, the Workplace Environment Improvement (WEI) group at Postal Headquarters reports to an executive staff manager under the umbrella of the labor relations department. This is unacceptable because postal labor relations officials historically have been reactive rather than proactive in terms of workplace environment improvements.  Due to the WEI group’s distance from top postal leadership in the current organizational reporting structure, its capacity to address proactively systemic issues of workplace violence and toxic workplace environments is seriously compromised. Further, workplace environment analysts’ reporting structure in the field was changed. Instead of reporting to the district’s manager of humans resources, they began reporting to an area office manager who directly reported to the area office manager of human resources. This structural change did not radically change how WEIs conduct their job duties or responsibilities, nor was there an increased likelihood of improving the postal culture. 

Unfortunately, as previously indicated all the WEA positions in the Postal Service, which included about 55-60 employees domiciled in Postal Districts, were eliminated. With the Postal Service’s history of workplace tragedies, its dramatic increase in toxic workplace environments, and ongoing downsizing initiatives, this does not bode well for its employees. During this time of dramatic change and turmoil, the need for WEAs is more important, not less. Clearly, the USPS has not learned the lessons of the 1980s and 1990s, when the workplace shootings were epidemic at postal facilities. 

Because of this deplorable, unilateral action by the USPS to eliminate the Workplace Environment Analyst positions, important questions arise. In 1993, these positions were considered essential and critical in dealing with the issues of workplace violence and its prevention. So, what has changed for higher-level decision-makers to believe that this was no longer an essential and critical priority? 

Who made the decision to eliminate these positions? Were the postal unions and management organizations informed or consulted on the elimination of the positions, prior to its implementation? Was the Board of Governors aware of this decision? If so, did they support the action? If an escalation of workplace violence occurs because of the elimination of these positions, who can be held responsible? Stated differently: Who is responsible, if there is an escalation of workplace violence (i.e., suicides and homicides) in the Postal Service because of the elimination of these positions?  

When I first became aware of the planned elimination of the Workplace Environment Analyst positions in February 2009, I wrote all the national unions’ and management associations’ presidents informing them of this disastrous decision. I was told by several of the officials that the Postal Service did not consult with them on the decision. Sadly, to the best of my knowledge, none of the postal unions or management associations made a concerted or vigorous effort to dissuade the Postal Service from eliminating these vital positions.

Concluding Remarks

There are many other recent, egregious examples of the Postal Service’s draconian, shameful, and inhumane practices, methods and decisions, including an Area Vice President not honoring the back-pay award decision made by the Merit System Protection Board (MSPB),²⁹ and the placing of video cameras in rural carriers’ vehicles in preparation for contract negotiations.³⁰ These examples and the ones detailed in the preceding provide substantive support to why I have concluded that the postal culture has become even more hardened, coarse, and toxic since the release of my book “Beyond Going Postal.” In order to address these concerns and for the Postal Service to become a healthy and safe organization, the national management organizations and postal unions, U.S. Congress, Department of Labor, and Department of Justice need to hold it accountable for its authoritarian, inhumane, and unethical methods and practices. The unfettered continuation of these methods and practices will only serve to elevate the Postal Service’s status as a violent-prone organization. 

Because of the documentary “Murder by Proxy”³¹ due to feature this summer, another postal documentary due later in the year or 2011, and the tireless championing of a national healthy workplace bill by Gary Namie³² and his associates, I continue to remain hopeful that the postal culture and the inhumane leadership therein will be addressed by the U.S. Congress and the current Obama Administration.