A Bit of Help from Big Labor

A stop-the-clock postal pay deal aids the battle against inflation

All across the country, mailmen gathered in their union offices, and as the clock approached midnight the tension began to rise. Would there or would there not be a postal strike in the morning? The answer came shortly after 4 a.m. Washington, D.C., time, when Emmet Andrews, head of the American Postal Workers Union, emerged bleary-eyed from behind closed doors at the offices of the Federal Mediation Service. After a tense, all-night bargaining session that capped 17 weeks of talks between the U.S. Postal Service and its 570,000 unionized employees, agreement had been reached on a new three-year contract.

The deal was bracing news not only for the postal workers, who generally expressed satisfaction with the terms, but also for Jimmy Carter. At long last, the White House could claim its first credible victory in the struggle to curb spiraling wage settlements. Big Labor's earlier successes in winning 10% or more in annual pay increases are threatening to push up still higher the nation's inflation rate, which is once again in double digits.

The postal workers' agreement, for which the Administration had tirelessly lobbied, is a small but significant departure from those egregious gains. It is also a good deal more moderate than what the postal workers had originally demanded, and could well wind up giving them somewhat lower increases than they enjoyed under their last contract.

The old contract provided scheduled wage rises of about 10% over three years, 10% more in cost-of-living increases, and pushed the average pay of postal workers to a level of $7.58 an hour, vs. $5.62 for private nonfarm workers.*

The new deal will hold automatic wage increases to about the same level as under the old contract, but will tighten up considerably on cost-of-living payments, which are made automatically every six months as inflation goes up. Though consumer prices are rising at an alarming 11.4%, Administration officials are hopeful that the rate of increase wi now begin to ease as food prices start to decline, and that inflation will average 7% for the year as a whole. If so, the postal workers should get no more than 6.5% in total pay increases during the contract's first year.

Though the postmen had initially demanded wage increases that would have totaled 14% in the first year alone, the real sticking point in the talks was that the Postal Service wanted to drop the no-layoff clause that was in the old contract. The unions feared that increasing automation in the sorting of mail could put more and more of their members out of work. Finally, at 10 p.m. last Thursday, two hours before the formal expiration of the contract, the Postal Service negotiators agreed to retain the no-layoff clause, and progress on the other issues came almost immediately.

The Administration remained officially silent on the results, perhaps taking a lesson from its inept handling of last winter's coal strike, when Carter went on television to proclaim the strike settled only to have the miners reject the pact in a ratification vote. The postal contract still has to be ratified by the membership of four separate unions in votes that begin next week. Having leaned on the Postal Service to hang tough in the negotiations, the White House was not eager to be seen gloating over the result. Said one Carter adviser: "We want to do anything to complicate the ratification process."

The postal pay deal was the last major union contract on the negotiation calendar this year and the first one to be settled within reasonable limits. Last March, in a peace-at-any-price frenzy, the Administration pressured coal operators into accepting a contract that will increase miners' total compensation by perhaps as much as 39% over the next three years. Two weeks ago, despite considerable White House jawboning, the railroads agreed to raise the wages of 340,000 of their workers by nearly as much. The Administration recognized that unless that pattern were broken with the postal workers, there would be even higher demands by other labor unions in 1979, when the calendar of negotiations is particularly heavy. Beginning next spring, contracts for some of the largest and most powerful unions in the country--including the auto workers, the electrical workers and the Teamsters --come up for renewal.

There could be much trouble, since some labor chieftains seem to be in a battling mood. Last week United Auto Workers President Douglas Fraser, invoking some class-struggle rhetoric that sounded like the 1930s, resigned from the semiofficial Labor-Management Group. That body was set up under Gerald Ford as a forum for corporate and union leaders to meet privately, debate common problems and advise the White House. Said Fraser: "Why pretend that labor and management in this country are sitting down and discussing the great issues of the day and that they have something in common when they don't?" The auto worker boss also declared that labor has become so disenchanted with the Democratic Party that there is talk of bolting and forming a third party.

The union leaders are upset because they turned out the vote for Carter in 1976, but his Administration has failed to push through many of their favorite bills. They have also been infuriated by the repeated charges of Carter's inflation fighters that labor has done nothing to help slow the rise in prices. With the postal settlement, however, both sides have the chance to change their tunes. Labor leaders can say that the postal workers accepted a moderate deal, while Carter can pat them on the back for that--and implore other unions to follow. sb

*Counting overtime and other premium pay, postal workers actually average $8 an hour.

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