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Small Group of Allstate Agents Votes to Affiliate With a Union

A small group of Allstate agents who say the insurer controls them like employees rather than as independent contractors has voted to affiliate with a...
August 23, 2011

A small group of Allstate agents who say the insurer controls them like employees rather than as independent contractors has voted to affiliate with a union.

Members of the Gulfport, Miss.-based National Association of Professional Allstate Agents (NAPAA) approved overwhelmingly to affiliate with the Office and Professional Employees International Union (OPEIU), AFL-CIO. Secret ballots were mailed to the NAPAA's 1,200 members and more than 94 percent voted in favor of affiliating with OPEIU, according to the association. The vote was administered by the American Arbitration Association (AAA) and was counted at the AAA's New York office.

NAPAA membership, which represent about 10 percent of Allstate's nationwide agency force, decided to join OPEIU after claiming the insurer has been manipulating its independent contractor rules, terminating long-time agents, cutting agency compensation, and driving down agent morale. Allstate says that courts and the IRS have recognized the independent contractor status of its agents and the company disputes the claims of a high number of terminations and low morale.

What It Means to Agents: Before anyone asks: Under federal antitrust law, PIA members cannot unionize.

Federal and state antitrust law exempt and declare that labor unions and individual purchasing-consumers are not combinations or conspiracies in restraint of trade, and they exempt specific union activities, including secondary picketing and boycotts, from the operation of the antitrust laws. But PIA outside counsel affirms that these antitrust exemptions and exceptions for unions and consumers do not apply to trade or professional association members, because they are competitors with each other. Thus, trade or professional associations may never act as a union or collective bargaining entity, or engage in boycotts or other antitrust behaviors. This is especially true since independent insurance agencies represent multiple carriers.

Agreements to fix commissions or prices, allocate markets or customers, engage in boycotts and to refuse to deal with third parties are automatically or per se illegal under the antitrust laws.  It doesn't matter what the reason for the agreement might be. Therefore, at any PIA meeting discussions of commission rates or product pricing, boycotts or "refusals to deal," allocation of markets or customers, and discussions which may cause a competitor to cease dealing with a third party are at all times strictly prohibited.

Antitrust law and successful enforcement actions comprise a very clear and consistent body of law in this area. These dictate how trade and professional associations and their members may compliantly execute their advocacy activities.

Read more on Allstate agents' unionization: Group of Allstate Agents Votes to Unionize (Insurance Journal 8/18/11)