For most, Independence Day occurs on July 4. For Allstate agents who believe they’ve been misclassified as ‘independent contractors,’ the hope is that day will come much sooner as dozens, if not hundreds, of Allstate agents file IRS Form SS-8 to determine whether they are independent contractors as Allstate proclaims, or have been misclassified all along.
The filings come on the heels of a recent petition drive started by an unidentified Allstate agent. The National Association of Allstate Agents (NAPAA)—a non-profit group representing the rights of more than 13,000 Allstate agents—published the petition in its most recent quarterly magazine. In the same publication, the group also published a hypothetical, example of the IRS Form SS-8.
“We prepared this hypothetical example based on the information we gathered from Allstate agents over a period of several years,” said Jim Fish, NAPAA’s executive director. “We believe that agents are being deliberately misclassified and we intend to expose this injustice in any way we can.”
In 2000, Allstate Insurance converted the majority of its sales force from employee to independent contractor status. With the change in status, many of those agents anticipated liberation from the requirements of being an Allstate employee. Now, almost a decade later, Allstate agents are still waiting for their independence, hence the interest expressed by a number of Allstate agents in filing an IRS Form SS-8.
“We anticipate the IRS and President Obama will receive thousands of petitions, said Fish, “When the SS-8 forms are filed, we expect that Allstate’s behavior will be heavily scrutinized by the IRS. If nothing else, this intense scrutiny may change Allstate’s behavior for the better.”
Allstate agents certainly aren’t the first independent contractors to be treated like employees without the accompanying benefits. In 2007, after filing a class action lawsuit demanding parity with employee drivers, current and former FedEx independent contractor drivers were elated when Judge Robert Miller of the U.S. District Court in Northern Indiana certified them as a class. This action has opened the door to similar cases involving independent contractors who are treated like employees.
“It was reported that the IRS plans to audit more than 6,000 companies for employment tax issues. We’re hoping the volume of Allstate agents filing SS-8 forms and the simmering discontent among agents over the misclassification issue will help push Allstate to the top of the IRS list, so we can finally resolve this long-standing problem,” added Fish.
For more information on the National Association of Professional Allstate Agents, you can visit their Web site at www.napaausa.org or call (877) 269-3474.
About National Association of Professional Allstate Agents (NAPAA)
Based in Gulfport, Mississippi, NAPAA is a non-profit organization whose members are predominantly insurance agents under contract with Allstate. In addition to offering a variety of benefits and services, NAPAA further serves its members by acting on their behalf and speaking with a distinct and unfettered voice on a wide range of issues. To contact NAPAA, please visit its Website at www.napaausa.org or call (877) 269-3474.