Mackinac Center Legal Foundation

Home Help Providers Saved From Illegal Dues

The Foundation sued to end the SEIU-HM and MQCCC's illegal diversion of so-called "union dues" from federal Medicaid checks received by home help providers, who are often tending disabled family members. The over-$6 million in "dues" are funneled to the SEIU, which purports to represent more than 55,000 of Michigan's home help providers.

Result: The case is currently under review.

The Issue

Rob and Pat Haynes of Michigan’s Macomb Township have adult children, but will never be “empty nesters.” Around the clock, in their home, and probably for life, they care for their children, Melissa and Kevin, who suffer from cerebral palsy.

Medicaid was meant to help people like the Hayneses, who face heavy health care burdens through no fault of their own. But the Hayneses’ decision to care for their children at home and accept Medicaid payments to offset the costs caused them to be labeled “government employees” who are subject to “union dues” — a violation of their rights and a corruption of public assistance for them and nearly 60,000 other home health care providers.

Isabella County's Steven Glossop has been providing care for his 71-year-old mother Linda Glossop for the last four years. Linda had heart surgery and suffered a stroke while recovering at the hospital, which limits her mobility.

Steven noticed money was being taken out of their Medicaid payments and going to a union. He contacted the Service International Employees Union asking to be released from the union. That did not happen.

"It's like I had no rights. I had no choice. You are part of this union," Steven said. Steven says he is not "anti-union." He was a Teamster in the early 1980s while working for a beverage company. "It negotiated our insurance. They did us good there."

Linda and Steven wonder why a union is dipping into a tax-payer supported program for disabled people and keeping it for its own benefits, not theirs.

"It sounds crazy to me," says Linda. "He doesn't have anything to do with the union."

Chain of Events

In 2004, the Service Employees International Union moved to unionize the tens of thousands of home health aides in Michigan. Many are family members who care for disabled loved ones who receive Medicaid subsidies. The Department of Community Health, which oversees the subsidies, could not be considered the employer of these home-based caregivers because that would have initiated hearings before the state Civil Service Commission. That, in turn, would have caught the attention of reporters and the public, given that the attempt would increase the state payroll by 40,000 “employees.” Instead, a shell corporation, the Michigan Quality Community Care Council, was created by the Granholm administration via an interlocal agreement between the DCH and the Tri-County Aging Consortium. A union attorney certified that the MQC3 was the employer of about 40,000 home health aides at the time. The Michigan Bureau of Employment Relations reportedly sent out about 43,000 ballots to home health aides to vote on the unionization question, but fewer than 20 percent were returned. The Hayneses, for example, say they never received a ballot or did not recognize what it was, since it would not have occurred to them that the government and the SEIU could enter their home and declare them public employees. The Legislature, in fact, is the only entity empowered by Michigan law to make such a decision.

The DCH began skimming a percentage of the Medicaid payments and funneling them as “dues” to the SEIU in late 2006. To date, the union has skimmed more than $30 million from the state’s most vulnerable residents. State legislators in the 2011-2012 budget voted to defund the MQC3, but in October 2011 it was still be operating. More recently, Michigan Capitol Confidential reported that the organization was receiving money from the SEIU to remain operational, even though its director was running the organization out of her basement in Okemos, Mich., working just three hours a week in order to draw unemployment benefits.

The Legislature and Gov. Rick Snyder sought to end this scheme through legislation. Gov. Snyder signed Senate Bill 1018 into law on April 9, 2012. The bill clearly defines home health caregivers as private individuals, rather than government employees, and thus not subject to mandatory collective bargaining. The Michigan House had passed a similar measure nine months earlier, though the SEIU was able to skim an additional $4 million in dues before the Senate acted. Even after Gov. Snyder signed the bill into law, DCH continued to allow the SEIU dues skim to proceed, stating that it had to meet the terms of the existing contract set to expire in September. The SEIU and MQC3, however, signed an extension of that contract on April 9, 2012 — the same day Gov. Snyder signed SB 1018 — extending its terms through February 2013.

On May 25, Attorney General Bill Schuette issued an opinion directing the dues skim to end immediately. The SEIU sued in federal court, seeking an injunction against the new law. In June, Judge Nancy G. Edmunds of the U.S. District Court of Eastern Michigan handed down the order allowing for the dues to continue to be withheld, citing the contract between the MQC3 and the union. In a July statement, the Attorney General announced he will appeal the federal court ruling.

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