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Letter to the Editor

EEOC Sues Allstate

NEW YORK -- A group of current and former sales agents suing Allstate Corp. for age discrimination will try to combine their case with a similar government lawsuit against the No. 2 U.S. car and home insurer.

The sales agents filed the suit in August, requesting class-action status. On Thursday, the Equal Employment Opportunity Commission, responsible for preventing workplace bias based on race, gender or age, sued Allstate on behalf of 6,400 former and current company agents in a Philadelphia court.

Northbrook, Illinois-based Allstate has filed to get the private class-action suit thrown out. Briefings on both motions are still pending.

The legal actions stem from a restructuring Allstate announced in November 1999. The plan called for the transfer of 6,400 fully employed agents -- about 40 percent of the company's sales force -- to a freelance contract without pension and health care benefits. Allstate terminated all of the employees' contracts by Dec. 31, 2000.

Allstate asked the 6,400 workers to sign releases agreeing not to sue the company. If they signed, workers could either become independent contractors or leave the company and receive higher severance packages and the chance to sell their books of business. The AARP, a non-profit organization for people 50 and over, also joined the case as a co-counsel earlier this month.

The Allstate Corporation announced that it is disappointed with the Equal Employment Opportunity Commission's (EEOC) decision to file a lawsuit against the Allstate Insurance Company following its reorganization of its agency system.

"Allstate values its positive relationship with the EEOC and believes that we are both committed to the same goals of equal opportunity and work force diversity. In fact, Allstate has been recognized on many occasions for this commitment and its employment practices," said Rick Cohen, president, Allstate Property and Casualty.

"Under the Allstate enhanced Exclusive Agency program, agents are economically advantaged through an increased commission structure, commission opportunities from direct channel sales, the ability to purchase agencies, a stock bonus plan, the ability to grow a transferable equity in their business, the ability to run satellite offices, local agency extensions and the ability to run other businesses," said Cohen.

The EEOC maintains that conditioning certain financial benefits, including the opportunity to participate in Allstate's most successful agency program, on the signing of a release constitutes retaliation under various federal employment laws. Allstate denies any allegations of retaliation.

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