Postal Service Cash Woes Threaten Fed Workers Comp Fund

1 min read

Photo: Alexander Marks

The Labor Department warned Friday that a fund compensating federal employees for work-related injuries could run out of money in the last quarter of fiscal 2012 if the U.S. Postal Service fails to make its scheduled payment in October.

Reuters reports the Labor Department notified Rep. Darrell Issa, chairman of the House Committee on Oversight and Government Reform, of the possibility in a letter dated Aug. 1.

The Postal Service is scheduled to make a $1.2 billion dollar payment in October to a fund covering federal employees under the Federal Employees’ Compensation Act.

USPS spokesman David Partenheimer told Reuters the Postal Service still plans to make the payment. The Postal Service faces no penalty if it does not make the payment, the Labor Department said in the letter.

The Postal Service announced in August it lost $3.1 billion in the third quarter and warned of a potential default if Congress did not intervene.

Issa has proposed legislation to end Saturday mail delivery and establish groups to guide post office closings. Issa’s legislation also proposes increased regulation over the Postal Service.

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