By Lori Ehde
Employees at Tri-State and Berkley Information Services found out last week how their jobs will be affected by the latest round of corporate layoffs.
W.R. Berkley Corporation, which owns Tri-State and Berkley Information Services in Luverne, announced last month it will discontinue personal insurance services in all of its property casualty insurance companies nationwide.
In the Luverne Tri-State Insurance office, that means more than 20 jobs will be eliminated by the end of next year.
The impact on BIS, however, was more significant. Roughly a third of its employees from offices in Luverne and Sioux Falls will be laid off in the coming year.
The plan is for the remaining Luverne staff to eventually move to the Sioux Falls office to share space with Tri-State employees when they move.
"It's a significant reduction in force," said BIS vice president Joel Christensen. BIS currently employs more than 100 people in Luverne and Sioux Falls, and the layoffs affect both locations equally.
Christensen said BIS is affected by corporate-wide trimming in information services.
"It's driven by a move to more common systems within the entire Berkley Corporation," he said. "Previously we developed a lot of our own products, but now we'll be integrating more vendor, third-party products."
Also, he said they will leverage other information technology resources outside of BIS within W.R. Berkley Corporation.
"The staff that remains here will continue to have a critical role in the new structure," Christensen said.
The staff reduction will occur during 2002, and the move will likely follow sometime in 2003, depending on Tri-State's move. "The idea is to be closer to the customers we support and minimize administrative overhead," Christensen said.
BIS has been leasing its building from the Luverne Economic Development Corporation, and the 10-year lease is due to expire Dec. 31, 2004.
W.R. Berkley Corporation announced two years ago Luverne operations would move to Sioux Falls by the summer of 2001.
Due to the latest corporate reorganizing, that won't happen until 2003.
While the news is hard on affected employees, the community as a whole feels the economic impact of Berkley decisions.
Tri-State currently lists 147 employees on its payroll, including 20 in the Sioux Falls office and more than 20 traveling representatives.
With an annual payroll of $4.8 million (including Sioux Falls employees and field reps) Luverne's economic health would be affected by Tri-State's absence.
Tri-State, now known as "Continental Western Group, Tri-State Region," owns the 33,000-square-foot building in Luverne and paid nearly $47,000 in property taxes this year.