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- W229004032 abstract "Clarence Edison was sitting at his desk trying to understand the implications of the news that he had just received from Allstate's Corporate Office. Allstate had just informed its agents that in 90 days agents would no longer be employees, but would be reclassified to independent contractor status for the company. As he reviewed the paperwork received, he tried to determine exactly what financial changes he would face as a result of this news. Clarence had been employed for over 25 years as an Allstate Insurance Agent. His plan had always been to work for Allstate until he was ready to retire. The letter cited a number of benefits the Agents would receive from this change. These benefits included the opportunity for agents to own their own business; freedom for agents to set their own schedules; the opportunity for agents to run their office with freedom from corporate restrictions. As Clarence thought about the conversion to independent contractor, he wondered what would become of his retirement plan. He wondered what expenses, normally covered by Allstate, would he have to pay now. He was not sure what owning his own business really meant. While he knew that there were pros and cons to owning his own business, he was concerned about the financial implications. He asked himself: Will I really be an independent contractor? and Will I benefit from being self-employed? Allstate Agents: Independent Contractors or Employee Agents In 2000 Allstate converted over 6,000 employee agents to independent contractor status. The agents' 401K plan was canceled and the agents lost other fringe benefits, such as medical insurance, paid vacation and sick leave. However, as Clarence went through the transition he felt that his job description as an independent contractor agent was fundamentally identical to that of the former employee agents. Even after the conversion, he continued to receive correspondence from Allstate. These letters continued to establish policies that addressed how he should run his office and provide service to his assigned areas. His office location had to be approved by Allstate. Allstate set a minimum window for office hours, requiring his office and offices of other agents to be open from 9:00 a.m. to 5:00 p.m., Monday through Friday. Allstate also required all after hour phone calls to be forwarded to its call centers regardless of other contact methods that Clarence had in place. Allstate also had mandatory training sessions for the agents and monitored agents' participation in these sessions. Clarence was assigned monthly and quarterly goals regarding the number and types of policies that he needed to sell. He knew that failure to meet these goals could result in the termination of the contract with Allstate. His performance was routinely monitored by Allstate managers. Due to his growing business Clarence needed to hire an assistant. However, his assistant needed to be trained by Allstate. The cost of this required training had to be covered by Clarence or his assistant and not by Allstate. Allstate offered a number of insurance and financial products. Clarence had no control over which of these products had to be sold because this was determined by Allstate. These multipleproduct lines were ever-changing and Clarence was expected to maintain proficiency in all of the product lines. Clarence was not the only agent impacted by these changes. These changes applied to all of the converted agents who stayed affiliated with Allstate. Background Businesses always tried to increase profit margins and created many strategies that improved the bottom line. …" @default.
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- W229004032 title "Am I Truly Self-Employed" @default.
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