Objective

Our objective was to assess the accuracy and reliability of In-Office Cost System (IOCS) telephone readings. The IOCS is the primary probability sampling system used by the U.S. Postal Service to attribute the labor costs of clerks, mail handlers, city carriers, and supervisors related to the handling of mail of all classes and rate categories.

Samples are collected using in-person observations or by telephone readings. Telephone readings are acceptable when it is not possible for a data collector technician (DCT) to reach an employee at his or her work location at the scheduled time of the sample. If an employee is not available for an in-person observation or telephone reading when the sample is scheduled, the sample must be rescheduled according to policy. In fiscal year (FY) 2016, the Postal Service conducted 546,650 IOCS readings: 305,800 (about 56 percent) were performed by telephone, and 240,850 (about 44 percent) were performed in-person.

The Postal Accountability and Enhancement Act of 2006 requires the Postal Service to file an Annual Compliance Report (ACR) with the Postal Regulatory Commission (PRC) within 90 days of the end of each fiscal year. The report analyzes cost, revenue, rates, and quality of service for all products. Further, it reports whether revenue for each mail class and service type covers its attributable costs, which are costs directly or indirectly caused by products.

What the OIG Found

While the DCTs observed by the U.S. Postal Service Office of Inspector General during selected site visits generally followed policies and procedures, opportunities exist to improve sampling procedures and controls to enhance the accuracy and reliability of the data. Specifically:

  • Discrepancies existed between FY 2016 IOCS data set filed with the PRC and the FY 2016 IOCS records contained within the Postal Service’s IOCS data entry system. Specifically, the data set filed with the PRC was missing 14,596 completed readings, 6,298 rescheduled readings, and 121 canceled readings. We also found 17,439 delinquent reading records within the final IOCS data set that were not complete and, therefore, unreadable. Management stated these discrepancies likely occurred because reading records were not transmitted to or approved in the IOCS data entry system by the end of the quarter, or were not properly processed for inclusion in the final IOCS data set. These factors resulted in the exclusion of reading records from the final IOCS data set.
  • Discrepancies existed between IOCS telephone reading data and Time and Attendance Collection System (TACS) data. IOCS telephone reading records indicated 94,929 carrier readings (31 percent) and 771 clerk/mail handler readings (0.25 percent) were not located in the facility or in the immediate area of the facility (“off premise”) during the scheduled reading times. From those identified as “off premise,” we selected a statistical random sample of those readings and determined that an estimated 15 percent of carriers and 59 percent of clerks/mail handlers were clocked into office operations at the facility during the scheduled reading times.

These issues occurred because the Postal Service did not have systems in place sufficient for DCTs to validate employee availability during telephone readings or for management to reconcile discrepancies after the fact between IOCS and TACS. Additionally, supervisors may have miscommunicated the actual location of the sampled employees to DCTs during telephone readings. If employees are potentially misidentified as being “off premise” and unavailable during the sampling process, it hinders data collectors from collecting comprehensive data. The data collected during IOCS readings are used to attribute costs to products. Therefore, if DCTs are missing opportunities to gather data, it could impact the accuracy of cost attribution.

  • Discrepancies existed between FY 2016 IOCS data set filed with the PRC and the FY 2016 IOCS records contained within the Postal Service’s IOCS data entry system. Specifically, the data set filed with the PRC was missing 14,596 completed readings, 6,298 rescheduled readings, and 121 canceled readings. We also found 17,439 delinquent reading records within the final IOCS data set that were not complete and, therefore, unreadable.

Management stated these discrepancies likely occurred because reading records were not transmitted to or approved in the IOCS data entry system by the end of the quarter, or were not properly processed for inclusion in the final IOCS data set. These factors resulted in the exclusion of reading records from the final IOCS data set.

In addition, there were no controls in place to verify completeness of the final data output. The Postal Service uses the final IOCS data set filed with the PRC for cost attribution. Incomplete sampling data impacts the accuracy and reliability of reported costs for mail products and services. This issue resulted in $31 million in misallocated costs among products, representing about 0.09 percent of the total labor costs distributed to FY 2016 products.

What the OIG Recommended

We recommended management:

  • Establish automated controls in the IOCS data entry system that validates IOCS telephone readings are rescheduled according to policy.
  • Verify employees’ activities and location at the time of IOCS telephone readings and report discrepancies with TACS to supervisors if corrections to clock rings are needed.
  • Verify all IOCS readings are transmitted to and approved in the Postal Service’s IOCS data entry system by the end of the quarter.
  • Confirm the completeness of the final IOCS data set filed with the PRC for cost attribution prior to submission to the PRC.

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Comments (2)

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  • anon

    The self service kiosks have the option for international mail. Trying to use them the message is to see a rep. 1 why have it listed & not able to use It? 2 there weeks ago I asked the rep in Evanston Illinois on Main st. I was told sarcastically by her she does not know contact the post office Again why have a feature im not able to use and experience sarcasm from YOUR STAFF

    Nov 04, 2017
  • anon

    To our immediately pig team on labor cost I have not read the complete articles yet but I will i have a very seriously comment on labor cost I may not put everything in the right format and this might not have anything to do with the labor cost you all is talking about but let me just tell you all what have been going on in the pass three month and as aware of your surroundings and people's abused the USPS on behalf when we don't have money in the budget to get only had of the new mail truck and when we still in the old truck which no one can find parts to fix trucks that older then 30 years old it disgrace and shame when you go out on the street and our trucks running so bad you think that the motor is about to drop out I wrote my truck up on several times for my hand brake don't work but you know carrier's get blame for everything no matter what and it's not our fault but just want you to all to know what happen in the city of Memphis tn this pass few weeks if we have a postmaster can anyone find him if not that ok we do know we have an area manager caused that why the city is in bad shape in holiday city this pass week started with Monday coca were told to bring back the cut off plus dps plus the parcel over and over this have been on the table that they are scanner the parcels deliver and bring them back this have went all the way to the tn district human resources mrs.ruth bland but to her we are lying about what going on we are the one in the station not her but we as employees and not only that the customers are the one who been hurt for not received their mail theirs parcel and two day priority mail that we should deliver as mail carriers but because you all have a 38 year old station who calling the shot on delayed mail and caused she godchild of the area manager she do what she pleased but as they stated they are the managers in charge and if they tell the coca to bring back mail it's USPS policy they can make that call they overburdened these routes they lie to human resources say that this matter will be fix it's a joke it were told Saturday's morning on the work room floor how they slandered certain carrier name on the telcomform these are the most unprofessional managers in the state of history they all your personal information out loud on a telcomform labor issues it's cost the USPS between 29.oo to almost 35.oo just to fill one of our mail truck everyday this gas do not last us two days caused the routes are so long if you look at a map it go east.west north and south this our routes every day some carriers are running out of gas caused of bad leaks and malfunction with the gas hand they smoke so bad that some customers stand back to keeps from choke labor's issues gas delayed the mail USPS pay the coca overtime night time and v just to bring that mail back in the station then the next day USPS had to turn around again pay overtime night time and v time just to redelivery that same mail don't take my word ask the customers how many complained they make against holiday city station a day 3715 Winchester road Memphis tn 38118 am quite sure someone can put the customer complained report just for this station what really upset me as a blog employees we sure be moving toward the future I like the idea that customers can track their packages certificate letters and mail so they will stop blaming the carrier's but but that still don't work I come back from one off my off day I got 12 redelivery parcel paper's on my desk I were told no matter what all amazon parcels must be deliver if truck broken down Monday when I pass the coca on Claudette she were rolling fine they used this as a poor excuse it's not first second or third time this done happened just on my route but I am not the only one this station got so much complained from customers who don't received their mail parcels been scan deliver but not been received the sad thing about this caused they are managers 204 b supervisor they makes the usps look so bad they couldn't cover it up that the truck broken down Monday caused the coca drove the truck back to the station which caused thousands of customers who didn't received mail when you do a head counts of how many families who lives in the same house it's add up oig you would be amaze of how many carrier rides some of their mail on the street that morning and bring it's back one thing I can say yes we are bring in revenue but we still loosing customers it don't take nothing but an unannounced drop in just make sure you take your shoes off we got killmaill is a is utf is all on the floor this station you come in you walk on mail return parcel just been sitting there for months customers complained caused they packages have not been returned back to the sender labor cost labor cost it's sad that because you are a black employees they make you work overtime and you not on the list labor cost labor cost thank you

    Oct 22, 2017