Allstate Insurance Company and the Equal Employment Opportunity Commission (EEOC) have settled litigation over age discrimination by the insurer brought by 90 affected employees. As a result, Allstate will fork over $4.5 million to settle all claims in the class-action suit.

The judgment arises from Allstate’s having instituted a rehiring freeze at the same time that it transitioned from sales agents to independent contractors. As a result, its laid-off agents were unable to apply for other positions within the company. The majority of these agents was 40 or older and thus protected by the Age Discrimination in Employment Act (ADEA).

“We at the EEOC are now bringing more and more lawsuits like this one to challenge company-wide policies or practices which discriminate against a large number of workers,” said EEOC Acting Chairman Stuart J. Ishimaru. “Make no mistake: As this settlement shows, we will insist on significant compensation and meaningful injunctive relief to resolve these cases.”

As provided in the Stipulated Order resolving the EEOC litigation (Civil Action No. 4:04CV01359 ERW), Allstate will pay former older employees who sought employment–or would have sought employment with the company in the absence of its policy–a total of $4.5 million to be divided among the class via a settlement fund. The order also provides for discrimination prevention training, posting of notices, reporting and monitoring, and other relief designed to educate Allstate managers in order to prevent future violations of the ADEA.

Employers, make sure you’re in compliance with the ADEA in every facet of your operation. Get a copy of Personnel Concepts’ ADEA Age Discrimination Compliance Kit today.