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$80M Verdict for Three Zurich American Workers Fired for Off-the-Record Days Off

$80M Verdict for Three Zurich American Workers Fired for Off-the-Record Days Off

Three former workers in a Northern California office of the Zurich American Insurance Co. who were fired after taking “off-the-record” paid time off were awarded more than $80 million in damages by a Sacramento jury Thursday, Sacramento attorney Lawrance Bohm announced. The case stemmed from a lawsuit originally filed in 2018 that went to trial after Zurich American declined settlement offers starting at $150,000 for each of the three plaintiffs who worked at the insurer’s Gold River offices, Bohm said in an interview. “I’m jubilant,” Bohm said. “It is shocking for an American-based insurance company that provides coverage to 90 percent of the Fortune 500 to have made a zero-dollar offer... This is vindication.” Zurich American spokeswoman Robyn Ziegler said in an email response to The Sacramento Bee that the company does not comment on litigation, “So I have no comment to offer you.” Wednesday’s verdict included damages for economic harm, reputational damages and $25 million in punitive damages for each of the employees — Melinda Brantley, Nicholas Lardie and Daniel Koos — who were part of Zurich American’s workers’ compensation division, Bohm spokesman Daniel Harary said in announcing the $80,252,412 verdict details. Bohm’s spokesman said the three plaintiffs were fired in December 2017 after they followed a supervisor’s policy of taking “off the record” time off as an incentive for hard work. The days off were called “Omen days,” referring to then-Assistant Vice President Chris Omen, court papers say. “Omen offered free paid time off (‘PTO’) based on performance,” court papers say. “Employees in Omen’s department referred to the free paid time off as ‘Omen Days.’ “Omen’s free paid time off was used to reward employees who were performing at a high level or reached certain goals. The free paid time off rewards did not require any requests or entries in the official PTO system. “If an employee used paid time off approved by Omen, the employee was instructed not to use any of Zurich’s official paid time off. On most occasions. Omen instructed the employee to ‘take a day off or delete the time off requests in the system and stated that ‘it’s on me,’ indicating that the employee earned the free paid time off. “The entire Rancho Cordova branch was aware of and benefited from this unofficial rewards program.” The three were fired days before Christmas 2017 after a brief investigation by the company, Bohm said. Zurich American argued in court filings that the employees were fired after “time theft” that resulted in the three being paid a total of more than $100,000 over two years. “Theft is not justified simply because your boss told you to do it,” the company argued. “Plaintiffs are three former managers at Zurich insurance company who were discovered to have under reported paid time off (PTO) at work. “They admitted to engaging in this activity and explained it away by saying that their supervisor told them to do so.” Bohm said Zurich American “maliciously defamed three very good people from our Sacramento community,” and that his clients did not want to be involved in a lawsuit. Bohm initially offered to settle the case for $150,000 for each plaintiff but was rebuffed, he said. In 2021, he tried again, offering to settle for $500,000 each but was turned down. Finally, before trial began in Sacramento Superior Court last month, he offered to settle for $2 million per plaintiff but was told no, he said. “Zurich has had years to prevent this and do right,” Bohm said, adding that company supervisors spent 71 minutes investigating the allegations against the employees before firing them. “For a company that prides itself on fairness, that’s frightening,” he said. “Thousands of us in California have claims being handled by Zurich. “If this is the way it treats its employees what does that mean about what we can expect from them when we need them?”    
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Insurance M&As Slow in Q1 2024: Optis Partners

Insurance M&As Slow in Q1 2024: Optis Partners

Mergers and acquisitions among insurance brokers and agents declined 18% in the first quarter, falling to the lowest level of deals since the beginning of the COVID-19 lockdowns in 2020, according to a report released Friday by Optis Partners LLC. A drop-off in deals by two of the biggest acquirers over the past several years – Acrisure Inc. and PCF Insurance Services – accounted for much of the decline, the Chicago-based investment banking and financial consulting firm said in the report. “On a trailing 12-month basis, we’re back to levels that we last witnessed at the end of 2020,” said Steve Germundson, a partner at Optis. BroadStreet Partners Inc. announced the most deals in the quarter with 29, followed by Hub International Ltd. with 12, Inszone Insurance Services with 10, and Keystone Agency Partners LLC with eight. Private-equity-backed buyers and private firms with significant outside financial support accounted for 71% of deals announced in the quarter. Publicly traded brokers announced 12 deals in the quarter, with Arthur J. Gallagher & Co. accounting for seven of them. Despite the reduction in deals by several previously highly active buyers, demand for agencies remains high, and prices for top-performing companies is strong, said Timothy J. Cunningham, Optis’ managing partner. “We don’t expect this to change any time soon,” he said.    
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Progressive to Sell Office Buildings as Shift to Remote Work Cuts Need for Space

Progressive to Sell Office Buildings as Shift to Remote Work Cuts Need for Space

Progressive Corp. intends to list several of its office buildings across the United States for sale as it consolidates office buildings amid a changing work environment, a company spokesman said. Among those that will be offloaded are its Campus 1 facility in Mayfield, Ohio and the Progressive Home campus in St. Petersburg, Florida, according to an email. Also slated for sale are the Colorado Springs campus in Colorado, the Riverview campus in Riverview, Florida, and Progressive Fleet & Specialty in Carmel, Indiana. "As we continue to grow and reimagine our workforce, Progressive offers flexible work options for many of our employees with most people choosing to work from their homes," a Progressive spokesman said in the email. "Our current office locations have always been a mixture of owned and leased spaces," it said. "As we continue to look for ways to operate as efficiently as possible while providing the best for our employees and customers, our Real Estate team has completed a comprehensive market analysis and will begin marketing efforts for the sale and/or lease of some buildings involved in previously announced consolidations." Progressive first announced last July it would consolidate several of its properties in Northeast Ohio and across the United States, with the company planning to hold the locations within its portfolio until the latest announcement. Progressive said It will continue to monitor and review office utilization in order to make the best decisions for employees and the company.

Progressive Corp. net income climbed more than five-fold to $2.33 billion in the first quarter as its combined ratio improved 12.9 points to 86.1.

A year earlier the company posted net income of $447.9 million. First quarter net premiums written increased 18% to $18.96 billion."

Most operating entities of Progressive Corp. currently have a Best’s Financial Strength Rating of A+ (Superior).

 
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U.S. Designates PFAS Chemicals as Superfund Hazardous Substances

U.S. Designates PFAS Chemicals as Superfund Hazardous Substances

The U.S. Environmental Protection Agency on Friday designated a pair of widely used industrial chemicals as hazardous substances under the country's Superfund program, accelerating a crackdown on toxic compounds known as "forever chemicals." The rule will require companies to report leaks of two of the most commonly used per- and polyfluoroalkyl substances, or PFAS, and help pay to clean up existing contamination. The EPA last week announced its first drinking water standards to guard against PFAS pollution. PFAS are a family of thousands of chemicals used in consumer and commercial products like firefighting foams, nonstick pans and stain resistant fabrics. They have been linked to cancer and other health concerns, and are often called forever chemicals because they do not easily break down in the human body or the environment. The new rule targets contamination from two PFAS known as PFOA and PFOS. It does not ban the chemicals. The Superfund designations will ensure that those responsible "pay for the costs to clean up pollution threatening the health of communities," EPA Administrator Michael Regan said in a statement. The Comprehensive Environmental Response Compensation and Liability Act, known as the Superfund law, allows the EPA and state regulators to undertake or order remediation of hazardous sites and seek reimbursement from site owners, hazardous waste generators, waste transporters and others. The EPA said on Friday it would prioritize enforcement against significant contributors to the release of PFAS, such as federal facilities and manufacturers. The American Chemistry Council, a leading industry trade association, called the rule "severely flawed" on Friday and said the chemicals have not been produced in the United States in nearly a decade. The Superfund program "is an expensive, ineffective and unworkable means to achieve remediation for these chemicals," the group said in a statement. Environmental groups praised the EPA's move. "These designations will give PFAS-contaminated sites the attention they deserve," Earthjustice attorney Jonathan Kalmuss-Katz said in a statement. The new rule, one of the most aggressive moves yet by the Biden administration to regulate PFAS, also makes public funds available for remediation. The regulation could spur additional litigation over liability for PFAS cleanup efforts. Lawsuits filed by public water systems and others accusing major chemical companies of polluting U.S. drinking water with PFAS chemicals led to more than $11 billion in settlements last year.    
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