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    Updated July 11, 2003    
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July 9, 2003
CONTACT: Drew Von Bergen  
(202) 662-2489 
      Full Text of Testimony

Letter Carriers Union Backs
Providing Government Retirees With Tax Savings
on Health Insurance Premium Payments

  Washington ~ The head of the 305,000-member National Association of Letter Carriers (NALC) union today urged Congress to provide millions of dollars in out-of-pocket savings to postal, federal and military retirees by allowing them to pay health insurance premiums on a pretax basis like active postal and federal employees.

NALC President William H. Young, testifying on behalf of postal labor at a hearing of the House Government Reform Subcommittee on Civil Service and Agency Reorganization, told subcommittee chair Jo Ann Davis (R-VA) that the union takes pride in having been a leader in establishing "premium conversion" within the federal community.

"Thanks to the collective bargaining process in place for postal employees, we were able to establish premium conversion for our active members nearly a decade before it became available to the rest of the federal workforce," Young said. "Over that time, this bargained-for contractual provision has saved active letter carriers throughout the country millions of dollars."

Young praised full committee chairman Tom Davis (R-VA) and Sen. John Warner (R-VA) for leading the effort to expand this benefit to retirees. Davis' bill, H.R. 1231, already has more than 250 cosponsors.

The NALC leader noted that while letter carriers are generally a healthy group, a full career of walking the streets and battling the elements presents postal retirees with some unique and real physical challenges. He said they also face some difficult financial decisions exasperated by the Windfall Elimination Provision and the Government Pension Offset which deprive civil service retirees of earned benefits.

Using as an example a new NALC retiree with 30 years service under the Civil Service Retirement System and enrolled in the family-coverage NALC Health Benefit Plan, Young showed how H.R. 1231 would save such a retiree $345 yearly.

"That may not sound like a lot, but to people who must live on a modest fixed income in the face of escalating health care costs and rising premiums, such savings are not insignificant," Young added.

The 114-year-old NALC represents city delivery letter carriers employed by the U.S. Postal Service in all 50 states and U.S. jurisdictions. Its membership includes some 86,000 retired letter carriers.


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