Lawmakers want Postal Service bonuses tied to delivery performance

The Postal Service says it has seen steady improvement in service since aligning staffing to workflow, addressing process improvements and retraining at the facility level, and taking other measures in 2025. A renewed focus on reliability coincided with a reorganization of the regional transportation network, which required loosening of some delivery standards in rural areas and led some to complain of slower mail delivery.

Postmaster General David Steiner said Friday, during a board of governors’ meeting, his organization has increased service performance by better leveraging the network.

On-time mail performance continues to slip. The Postal Service missed its on-time target for all eight mail delivery categories, none of which hit the 95% threshold, in fiscal year 2025, according to the agency’s annual report. It delivered 72.7% of single-piece First-class mail, scheduled for three-to-five day delivery on-time. Marketing mail and periodicals, as well as pre-sort First-Class overnight mail had a 93% score.

In fiscal year 2022, the USPS delivered 91% of First-class mail on time and delivered 93.3% of marketing mail on time, according to a progress report on the agency’s 10-year restructuring and modernization plan.

Frustration with late deliveries has mounted along with negative cash flow. The Postal Service has lost $25 billion over the last three years. On Friday, the mail carrier reported a $2.5 billion loss for the third quarter, down from a $3.1 billion loss the prior year. 

Sen. Hawley has been especially aggressive complaining about late mail, taking up the cause for rural citizens who say years of delays and missing mail are creating a financial burden when they don’t receive their bills or paychecks, and jeopardizing their health when prescription medicines are late. In April, a large pile of undelivered mail was discovered in a vacant lot near St. Louis, with many postmarks indicating letters were only going across town, not cross country. 

Hawley challenged Steiner at a June 24 hearing to explain why postmaster generals have received more than $2 million in bonuses over the past 10 years, as delivery and financial performance declined. Steiner, who took office a year ago, has already received a $170,000 bonus.

“Your targets for on time delivery in my state, which were not good to begin with, are just in the 90s, meaning you could miss it 10% of the time and give yourself an A grade. But start looking there in 2024, 2025. You’re hitting your on time delivery targets 76% of the time — maybe. That means fully a quarter of the time, best case scenario, people’s mail in my state is not being delivered to them on time,” Hawley said.

Steiner said those metrics are unacceptable, but countered that the postal operator is producing better service results nationwide.

Hawley has launched an investigation into the systemic delivery failures and abandoned mail in Missouri, suggesting some of the problems could be the result of criminal activity. 

An audit last year by the U.S. Postal Service’s Office of Inspector General found more than 2.5 million delayed mailpieces at the St. Louis Processing and Distribution Center — the largest delayed mail volume ever recorded since it began conducting field operations reviews in 2021. The report blamed systemic issues affecting package scanning, inadequate reporting of delayed mail incidents, and understaffing that caused mail from commercial mailers to not be sorted to the correct route at two processing plants and seven delivery units in the St. Louis area.

Another recent audit for Kansas City found that there were nearly 100,000 delayed pieces of mail over a three-day inspection. 

An October analysis by Postal, a virtual mailbox and compliance service, showed more than 542,000 pieces of mail were reported lost or missing between 2022 and 2024. More than 150,000 reports involved mail going missing “after delivery, nearly 350 incidents per day, suggesting a prevalence of porch piracy.

Steiner tried to head off the anti-bonus bill. “I was fortunate enough to be quite successful in my career in the private sector, so any compensation action you take against me will have little effect,”  but will limit the Postal Service’s ability to attract qualified executives in the future, he wrote in a July 31 letter obtained, and first reported by Axios.

“Picking any single performance metric to punish management would constitute Congress elevating achievement of that metric at the expense of other important metrics. In order to achieve our mandates of providing reliable service in an efficient and cost-effective manner, we must necessarily balance service and cost considerations. In this case service performance is singled out, which would have the near inevitable impact of increasing costs because almost any action to improve service comes with added cost — increasing transportation, work hours, equipment, and people,” Steiner wrote. 

“I would also note that management has a sharp focus on improving service, so the bill is completely unnecessary: our service ‘scores have improved and will continue to improve, and service is already a part of every manager’s annual goals. That said, we are acting prudently to improve service as we leverage the opportunities presented by our new network to not only enhance service reliability, but also our operational precision and efficiency, a process that necessarily takes time,” he explained.

Companion House bill

The PERFORM Act in the House would prohibit a performance-based bonus for the postmaster general if, during the preceding fiscal year, the Postal Service fails to meet nationwide service performance targets, reports a net loss, or receives an adverse opinion or disclaimer in its financial audit.

“The American people don’t get bonuses for failure, and neither should the Postmaster General. The PERFORM Act ends the practice of rewarding poor performance and makes clear that leadership must earn incentive pay by delivering results – not excuses,” said Rep. Dale Strong, R-Alabama, in a news release announcing the proposal.

“If the U.S. Postal Service were a private sector operation, it would have filed for bankruptcy years ago. Further, if a CEO’s tenure saw an average annual net loss of $10 billion while service standards continued to decline, company leadership would be standing in the unemployment line —  not collecting performance bonuses,” Strong added.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.

Write to Eric Kulisch at ekulisch@freightwaves.com.

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