EEOC Sees No Merit In Allstate Counterclaim

By Mark E. Ruquet

NU Online News Service, Dec. 20, 4:45 p.m.EST--The exclusive agents engaged in fighting AllstateInsurance Company over its employment practices claimed a smallvictory today after the U.S. Equal Employment OpportunityCommission said the company does not have a basis for filing acounterclaim against them.

The Northbrook, Ill.-based company filed a counterclaim against28 agents who have filed a discrimination complaint with the EEOCagainst Allstate, said Michael J. Wilson, with the Washington, D.C.law firm of Zevnick Horton, LLP, one of the attorneys representingthe agents in the case.

Allstate claimed the agents signed an agreement not to sue thecompany in exchange for a severance package.

In its determination, the EEOC said Allstate's claim had nomerit because the agents brought their suit after the commissiondecided the company had violated the agents' rights, anddiscriminated against them. The commission also noted that thecompany's attorney stated that the agreement did not prevent theagents from challenging the agreement.

Mr. Wilson called Allstate's actions "vindictive," and said itmight have discouraged other agents from filing similar complaintsout of fear of being sued by the company.

"We are disappointed with the EEOC's opinion and believe ourcounterclaim is valid," said Emily Daly, a representative forAllstate.

She said the EEOC's "opinion" had some factual errors, and thatthe company is in the midst of litigation over the EEOC'spronouncement.

The agents' action dates back to 1999, when Allstaterestructured its 6,000 employee-agent workforce by releasing themand re-signing them as independent contractors. Under the newcontract, the exclusive agents can only sell Allstate products.

The agents claim they lost pension and other company benefitsthey had been entitled to while working as direct agents for thecompany, many of whom had long years of service with Allstate.

One outgrowth of the transition is an attempt to unionize theexclusive agents.

On Dec. 2, the National Labor Relations Board in Chicago deniedthe agents the right to form a union. The NLRB found that theagents are independent contractors, not employees of Allstate, anddo not have a right to organize under the law.

John Bryant, president of the United Exclusive Allstate Agents,which is heading the union drive, said the Office and ProfessionalEmployees International Union, AFL-CIO, which is seeking torepresent the agents, would be filing an appeal of the decision inWashington, D.C., on Monday.

"We remain cautiously optimistic," said Mr. Bryant, who is alsoon the board of the National Association of Professional AllstateAgents, adding that the association felt the Chicago decision wasin error.

Additional information on the discrimination suit is availableat www.allstatecase.com.