Talks between Allstate Corp. and more than 300 of its captive agents to settle a long-running dispute over contractual changes have broken down. The insurer faces complaints regarding its 1999 plan to convert agent positions to independent contractor status.
The move is part of Allstate’s plan to have all 15,000 of its agents operating as independent contractors. The agents’ charges allege that the company’s requirement that they sign a release in order to receive the benefits that went along with becoming an independent contractor was retaliatory. The company disagreed with their allegations.
In October 2000, the EEOC agreed with the agents’ position, and since then has been engaged in conciliation discussions with the company. The dispute will likely be resolved in court. Meanwhile, the company’s fourth quarter profits rose 29 percent. The gains reflect, in part, early success for Allstate’s expansion beyond traditional life insurance into financial and investment products.
The company said growth in both its main auto and home insurance business and its fast-growing financial unit enabled it to offset declining revenues from premiums.
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