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USPS OIG – Penalty Overtime

September 28, 2023 ,

READ FULL ARTICLE AT » Office of Inspector General OIG


During emergencies or to address service needs, the U.S. Postal Service may require employees to perform work in excess of eight paid hours in a day or 40 paid hours in a week. Generally, hourly employees are entitled to regular overtime (OT) after working 40 hours in one week, while certain eligible employees are entitled to penalty overtime under certain conditions within the collective bargaining agreements. OT is paid at one and a half times the employee’s hourly rate. However, the Postal Service pays penalty overtime to eligible employees at twice the employee’s hourly rate. Workhours are a significant cost to the Postal Service, and management must ensure all hours worked are authorized and accurately recorded to monitor and control their costs.

What We Did

Our objective was to assess the Postal Service’s management of penalty overtime. For this audit, we analyzed nationwide penalty overtime data during fiscal years (FYs) 2020 through 2022. The data included average penalty overtime per employee and the total penalty overtime hours used. We conducted site visits at 22 judgmentally selected facilities where we held interviews to identify underlying causes that contributed to penalty overtime usage at the facilities and the Postal Service as a whole. Additionally, we interviewed headquarters personnel regarding their responsibilities, processes, and procedures on the management of penalty overtime.

What We Found

Opportunities exist for the Postal Service to improve penalty overtime management and reduce unauthorized penalty overtime hours. Specifically, facility management and lead clerks did not always properly identify and categorize penalty overtime transactions in the Time and Attendance Collection System, as authorized or unauthorized, by the end of the pay week as required. Additionally, facility management did not always properly document unauthorized penalty overtime hours.


We recommended management (1) implement consistent oversight procedures to ensure penalty overtime transactions are cleared at each facility; (2) reiterate policy on the use and clearing of the report categorizing penalty overtime hours as authorized or unauthorized; (3) reiterate management responsibilities and provide oversight for recording unauthorized penalty overtime hours; (4) develop and implement a tracking mechanism to monitor unauthorized OT and penalty overtime hours; and (5) determine the feasibility of updating the form used to submit unauthorized OT requests to differentiate between unauthorized OT categories.

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