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Allstate Agents Group Hopes to Affiliate With AFL-CIO

July 19, 2011

A group representing more than 1,000 Allstate Corp. agents will vote later this summer on whether to affiliate with a national union.

The National Association of Professional Allstate Agents Inc., formed more than two decades ago to protest Allstate’s move at the time to shift more overhead costs to agents, will begin soon to solicit votes from its members on joining the Office and Professional Employees International Union as a guild. Votes will be counted Aug. 17.

Joining a larger organization could give a stronger voice to Allstate agents unhappy with the company’s threats to fire them for missing sales goals, which these agents say are increasingly unrealistic as the company steadily raises rates for automobile and home policies, said Jim Fish, executive director.

Northbrook, Illinois-based Allstate considers its agents to be independent contractors rather than employees. Thus the labor group couldn’t become a collective bargaining unit, even if NAPAA votes to join the AFL-CIO-affiliated union, which represents more than 125,000 workers. But it potentially would raise NAPAA’s profile and give it access to more resources for lobbying and court challenges to Allstate policies toward agents.

Agents long have complained that Allstate requires them to finance their own offices as if they are independent contractors but subjects them to changing rules that effectively treats them as if they’re employees.

“Allstate would be put on notice that this is a serious organization, and we would have more clout that way,” said Fish, a former Allstate agent whose contract to sell Allstate policies was taken away by the company nearly 10 years ago after he pointedly questioned then-CEO Edward Liddy at the company’s annual meeting.

Allstate consistently has regarded NAPAA as a group of disgruntled agents who don’t represent the views of the majority of Allstate’s agents. A company spokeswoman declined comment.

“Allstate has never recognized us and may never recognize us,” Fish said. But, referring to the abrupt July 18 departure of Joseph Lacher, president of Allstate’s property and casualty unit, Fish said: “The company is in disarray. We’re trying very hard to get their attention.”

He said he was confident NAPAA members would vote to join the guild.

Fish said about 10 percent of Allstate’s 11,000 agents are members of his group, but many agents who don’t belong to NAPAA have become concerned about their future livelihoods.

In addition to Allstate’s stated plans to reduce its agent force, it has alerted agents to plans to reduce their commissions to 8 percent from 10 percent from renewing their customers’ policies. That was an initiative of Lacher’s, so it’s unclear whether his departure will delay or change those plans.

Allstate shares plunged 5 percent July 18, to close at $28.01, approaching its 52-week low of $27.26 last September.

Filed by Steve Daniels of Crain’s Chicago Business, a sister publication of Workforce Management. To comment, email editors@workforce.com.

 

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