More than a year after Geico employees kicked off a campaign to unionize, leaders say the workplace culture has not improved.
The “Geico United” effort is believed to be the first attempt to unionize an insurance company workforce. Lonnie Konikoff, a 15-year Geico employee in Amherst, N.Y., said the union effort has “many, many hundreds” of signatories. While Geico is headquartered in Chevy Chase, Md., the Amherst office is leading the union effort.
The second-largest private passenger auto insurer in the United States, Geico said it employs more than 43,000 people. Known for its comical commercials starring a gecko, Geico is owned by Berkshire Hathaway, headed by investing legend Warren Buffett.
According to the National Labor Relations Board, employees can unionize in one of two ways:
If at least 30% of workers sign cards or a petition saying they want a union, the NLRB will conduct an election. If a majority of those who vote choose the union, the NLRB will certify the union as your representative for collective bargaining. An election is not the only way a union can become your representative. Your employer may voluntarily recognize a union based on evidence – typically signed union-authorization cards – that a majority of employees want it to represent them.
Geico is opposed to the employee union effort, Konikoff said. The NLRB continues to investigate a complaint filed on Feb. 23, 2023 alleging that Geico fired an employee last year for engaging in a Section 7 “protected concerted activity.”
According to Section 7 of the National Labor Relations Act a protected concerted activity “only requires two or more employees acting together (‘in concert’) to improve their hours, pay, working conditions or other aspects of their job.”
Geico sent out emails to employees against unionizing, Konikoff said, at one point advising employees to call the police on union activists going door to door.
“They kept emphasizing how people are going to have to pay dues,” Konikoff said, “and they kept calling us a ‘third party,’ even though are all of us who were working on this, we’re all Geico employees. And once we establish a union, the entire negotiating team and the divisions within the union are going to be Geico employees.”
Christine Tasher, director of public relations for Geico, did not return numerous emails and phone messages seeking comment. Michael Young, Geico public relation specialist, also did not return several messages.
A September letter from New York legislators warned Geico to refrain from “union-busting activities.”
Profit sharing an issue
Geico union activists say the company culture changed when Todd Combs was elevated to CEO in January 2020. Said to be Buffett’s protege, Combs is a former hedge fund manager and Columbia Business School graduate.
Combs first year was marred by the COVID-19 emergency. But once the pandemic receded, “we started noticing a number of changes,” recalled Konikoff, who handles auto underwriting. “Things weren’t the same. People were treated very poorly. They started letting people go and we started piling up losses, and you could see that the people that Todd put in place around him … have a very different vision of Geico than what many of us have seen for all these years.”
Still, the union push did not take shape until Geico suddenly replaced a profit-sharing plan with a cash bonus in February 2022, he added. The company eventually settled on a 6% 401(k) match in January 2023, Konikoff said. Employees were stunned by loss of significant compensation, he said.
“One of the things that people always kind of compromised on is they felt maybe in a lot of areas GEICO didn’t pay as much as as other insurers,” he explained. “But what compensated for that was a very sizable profit sharing. We averaged roughly about 18%. Every year that’s 18% of your entire salary, and they had a method in which a portion of it would go into your 401(k) and the rest as a cash bonus.”
In addition, Geico forced many employees into new positions, Konikoff said, as the company suffered enormous underwriting losses.
Geico suffered a $1.9 billion pretax underwriting loss last year, although things seemed to turn around in the first quarter of this year.
The company reported $703 million in earnings as higher average premiums and lower advertising spending contributed to the gain even as claim frequencies fell, Berkshire said in a statement reporting first-quarter earnings.
After an initial burst of union activity and publicity last summer into the early fall, Geico activists appear to have lost momentum. The group’s website lists events and news from last year. Social media accounts created for the effort show no recent activity.
But Konikoff said activists are pressing ahead, holding events and reaching new Geico supporters.
“We’re still recruiting other people,” he said. “We just had a very successful meeting where a number of people are going to be participating with us.”
Geico has not backed down from its hard line with employees, union activists say. Employees were recently told to return to the office two days a week beginning July 10, Konikoff said, breaking an earlier promise to continue remote work if certain goals were met.
Melissa Miller was fired from Geico earlier this year. A claims service representative, Miller spent most of her day on the phone, she said, trying to meet work goals that kept increasing. Geico contested Miller’s unemployment claim, which left her without income for months. Miller recently won an appeal for unemployment benefits.
“I explained to the judge that I have never been coached,” said Miller, who worked at Geico for five-and-a-half years. “I have never been warned. No written warning, no issues. I’m entitled to 20 minutes, 20 to 30 minutes of coaching every week. I have not received that. I’ve never received that.”
Weekly departmental meetings were often spent on anti-union discussion, she recalled. Miller joined the union effort a few weeks before she was fired.
“I remember speaking to my supervisor in one of the meetings and saying, ‘For a company who is trying to convince me and trying to reassure me that I don’t need a union, you’re jamming this anti-union stuff so far down my throat it’s concerning me,'” said Miller, of Tonawanda, N.Y. “‘It’s making me feel like I actually need one because it’s actually making me feel insecure in my position.'”
Miller has since found another position with a top auto insurer. Meanwhile, Konikoff remains hopeful of changing Geico for the better.
“You just reach a point in life where you feel that you want to contribute something and you feel it’s the risks are worth it,” he said. “[I’ve] never been like this before, but there comes a time when you see that certain issues are so important, and are affecting so many people, that you have to stand up and take a position on it.”
InsuranceNewsNet Senior Editor John Hilton covered business and other beats in more than 20 years of daily journalism. John may be reached at email@example.com. Follow him on Twitter @INNJohnH.
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