Postal unions' pay raise demands would cost $50 billion over the next three years and raise the price of first-class postage to 43 cents, according to a top Postal Service negotiator.
"We don't take it as a very serious proposal. . . . They're in a fantasy land," Assistant Postmaster General David Charters said Monday, noting that the service's annual budget is $40 billion.The Postal Service and its four largest unions, which together represent 660,000 workers, were working against a deadline of midnight tonight to reach a compromise for a new contract.
Moe Biller, president of the American Postal Workers Union, said Postal Service officials are "the ones who are not in the real world." He said management always predicts huge stamp increases during contract bargaining to win the public's support.
"They predicted a 50-cent stamp in 1981 - it never happened," Biller said. Stamps now cost 25 cents.
If no agreement is reached by midnight tonight, the two sides could agree to continue talks or allow the Federal Mediation and Conciliation Service to appoint a neutral arbitrator.
Under federal law, it is illegal for postal workers to strike.
The Postal Service is offering a two-year contract that provides cash bonuses of $450 the first year and $500 the second year. In addition, the Postal Service would implement a pay incentive plan in which workers could receive bonuses of up to $1,100 a year if their divisions met certain customer satisfaction and budget goals.
Management's plan would provide cost of living increases only if inflation rose more than 4 percent. For instance, if inflation rose 6 percent, workers would get a 2 percent raise. So far this year, the government's inflation gauge has risen 6.7 percent.
Biller said the union would reject the Postal Service's offer of no cost of living increase before a 4 percent inflation rate.