Agents Seek Intervention By IRS Allstate Independent Contractor Agents Petition IRS for Rights

In 2000, Allstate Insurance adapted the majority of its sales force from agent to absolute architect status. With the change in status, abounding of those agents advancing liberation from the requirements of accepting an Allstate employee. Nine years later, those 12,000+ Allstate agents are still cat-and-mouse for their independence. Having developed weary cat-and-mouse for Allstate to appropriate the situation, they’ve taken their case to the IRS in the anatomy of a address drive.

The petition, accounting by an anonymous abettor and appear nationally by National Association of Professional Allstate Agents (NAPAA), a non-profit apery the rights of Allstate agents, cites a Private Letter Ruling issued by the IRS in 1989. NAPAA contends this letter gave Allstate tax-advantaged cachet by able the IRS that the agents would become accurate absolute contractors and be advised as such. It’s an acceding the agents argue Allstate has far from lived up to its end of the bargain.

“It’s a bearings area Allstate gets to accept its block and eat it, too,” said Jim Fish, NAPAA controlling director. “Agents blade all of the costs and risks associated with operating an absolute business, but are controlled as employees. Meanwhile Allstate enjoys a huge aggressive amount advantage by alienated costs associated with pensions, bloom insurance, 401k’s, Social Security and, a lot of importantly, federal taxes. You would anticipate that abandoned would amount the IRS’s attention, but that’s not been the case.”

Added Fish, “Now that the IRS has appear affairs to analysis 6,000 companies for application tax issues, maybe Allstate agents will assuredly attain the absolute architect cachet they accept continued been denied.”

Some of the restrictions Allstate agents accept begin as “independent contractors” include:
•Mandatory appointment hours.
•Sales quotas.
•Verbal and accounting warnings aggressive accident of arrangement for not affair aggregation quotas.
•A claim to advanced appointment blast calls to aggregation account centers afterwards hours.
•Subjection to a amount of employee-like controls, including anniversary achievement reviews.
•Mandatory affairs and training sessions.
•Submission of articulate or accounting assembly reports.
•Risk of abortion at-will.

In fact, abounding agents feel they’re advised added like advisers today than if they were absolute employees. Said one agent, “Back then, we had a alimony plan and, if the aggregation capital to blaze you, there was an abettor analysis axle in place. Now, they can blaze you with or after reason.”

Allstate agents absolutely aren’t the aboriginal absolute contractors to be advised like advisers after the accompanying benefits. In 2007, afterwards filing a chic action accusation ambitious adequation with agent drivers, accepted and above FedEx absolute architect drivers were animated if Judge Robert Miller of the U.S. District Court in Northern Indiana certified them as a class. This action has opened the aperture to agnate cases involving absolute contractors who are advised like employees.

So why hasn’t the IRS gone afterwards Allstate?
“That’s a acceptable catechism and one we achievement this address gets the IRS and the Obama administering to answer. Especially back this bearings has such a affecting appulse on an agent’s book of business,” said Fish.

The abiding ambition for a lot of allowance agents is to body their book of business and then, if they retire, advertise it to the accomplished bidder. At Allstate, this is not consistently accessible because the aggregation controls who buys these books of business. Said one agent, “Our books of business were declared to alter our pensions, but [Allstate] managers accept started to baffle in the sales process, which has bargain the amount of our agencies. This isn’t fair because for abounding of us, our book of business is the a lot of important retirement asset we have.”

For added advice on the National Association of Professional Allstate Agents, you can appointment their Web website at www.napaausa.org or alarm (877) 269-3474.

About National Association of Professional Allstate Agents (NAPAA)
Based in Gulfport, Mississippi, NAPAA is a non-profit alignment whose associates are predominantly allowance agents beneath arrangement with Allstate. In accession to alms a array of allowances and services, NAPAA added serves its associates by acting on their account and speaking with a audible and able articulation on a advanced ambit of issues. To acquaintance NAPAA, amuse appointment its Website at www.napaausa.org or alarm (877) 269-3474.