GRAND RAPIDS, Mich. — A day after California-based Farmers Insurance Group announced it had laid off some 2,400 workers, including an unknown number in West Michigan, a group of affected employees has shared several concerns regarding the firings with 13 ON YOUR SIDE.
The company suggested the decision coincided with a corporate reorganization and related austerity initiatives.
The employees terminated this week accounted for roughly 11 percent of the insurance giant’s workforce.
Farmers, leaders suggested, had taken "strategic actions" to ensure a profitable future and create a "more simplified and streamlined organizational structure and a new approach to how it delivers insurance products to its agents and customers."
One of the workers affected told 13 ON YOUR SIDE via Zoom Tuesday that she had been notified following a brief video message from Farmers Group CEO Raul Vargas, wherein Vargas announced the reorganization and resulting terminations.
The email, she explained, included information regarding a severance package. She claimed she and her co-workers had not been allowed to finish their shifts.
Characterizing it as “ruthless,” the firing, she related, couldn’t have been less personal or come at a worse time.
“I thought it was insane, that they're just dropping all of us,” they related. “We have kids… school just started. It seemed like a really like inhumane thing to do to just say, hey, you're terminated and it just be so random.”
“We were just easily thrown-away and it was not personal at all.”
A second employee, who requested anonymity, told 13 ON YOUR SIDE she had also been terminated Monday, suggesting the insurance group “couldn’t have handled it worse.”
“We were all waiting in a panic. Then… the first wave of emails came out. These were the 'safe' emails. My husband got one, and I hadn’t received my email yet. A few moments later I got the email.”
The employee included a transcription of the email she said she received from corporate leadership:
"As shared earlier today in our town hall, current industry and economic trends have negatively impacted our performance, and unfortunately, we have to take difficult but necessary steps to reduce our costs and better position the organization for future success. This was not an easy decision, but it is crucial to a future of long-term profitability and growth.
I regret to inform you that your employment has been impacted.
I know you likely have many questions, and we’d like to provide support and information to you in a variety of ways.”
A third employee claimed during a conversation with 13 ON YOUR SIDE that their access to the Farmers system had been revoked so rapidly they had been unable to utilize the resources to which the email had alluded.
Farmers Insurance declined to answer our emailed question, concerning how many employees had been terminated from Grand Rapids-area locations.
A company spokesperson provided the following statement in response:
“Given the existing conditions of the insurance industry and the impact they are having on our business, we need to take decisive actions today to better position Farmers for future success,” said Raul Vargas, President & Chief Executive Officer of Farmers Group, Inc. “Decisions like these are never easy, and we are committed to doing our best to support those impacted by these changes in the days and weeks to come.”
Farmers is executing a new strategy to reinvent how insurance is delivered, simplifying systems and introducing innovation that supports the success of its employees and agents, while offering comprehensive protection for customers. Farmers will share additional details about how it is supporting exclusive agents and independent agents with better systems, tools and data to help their businesses succeed, and meeting target customers’ broad insurance needs with an industry-leading range of products.
Vargas continued: “As our industry continues to face macroeconomic challenges, we must carefully manage risk and prudently align our costs with our strategic plans for sustainable profitability. Our leaner structure will make us more nimble and better able to pursue opportunities for growth and ultimately make Farmers more responsive to the needs of our insured customers and agents. There is a bright future – for Farmers and for our industry – and it necessarily will look different than the past.”
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