News Story

BREAKING NEWS: State to Stop Illegal ‘Union Dues’ Withdrawals From Day Care Providers

For Immediate Release
Tuesday, March 1, 2011
Contact: Patrick Wright
Director, Mackinac Center Legal Foundation
Kathy Hoekstra

Communications Specialist

Mackinac Center for Public Policy

State of Michigan to Stop Illegal ‘Union Dues’ Withdrawals From Checks to Home-Based Day Care Providers

‘Fantastic news’ needs to be coupled with legislative action to prevent similar schemes in the future, says Mackinac Center attorney

MIDLAND — A spokesperson for the Michigan Department of Human Services today told the Mackinac Center for Public Policy that on March 18 the department will stop withdrawing so-called “union dues” from subsidy checks to home-based day care providers who supply child care services to low-income families. The Mackinac Center Legal Foundation filed suit against the DHS in 2009 to stop the illegal withdrawals.

 “This is fantastic news,” said MCLF Director Patrick J. Wright, who sued the DHS on behalf of Sherry Loar of Petoskey, Michelle Berry of Flint and Paulette Silverson of Brighton. “Our clients took a courageous stand against powerful interests and overwhelming odds. The idea that millions of dollars could be diverted annually from the subsidy checks of low-income families to fatten union coffers was bad enough. The fact that the government was a party to this scheme and was willing to call private employers ‘public employees’ made it all the more egregious. It is commendable that new DHS Director Maura D. Corrigan has just publicly affirmed in a news release, ‘[T]hese providers are not state employees.’”

Loar, who first brought the dubious “public employee union” scheme to the attention of the Center, stated: “I’m thrilled. But this lawsuit should not have been necessary in the first place. My government attacked the sanctity of my home just to benefit its political allies. I’m so happy to know that I’m no longer responsible to a union inside the walls of my own house.”

The lawsuit was filed in September 2009 after the discovery that the DHS and Mott Community College had entered into a so-called “interlocal agreement” to create a shell employer, the Michigan Home Based Child Care Council, solely to shanghai private business owners into a public employee union. The union, Child Care Providers Together Michigan, is a subsidiary of the United Auto Workers and the American Federation of State, County and Municipal Employees. E-mails obtained through the Freedom of Information Act show that the unions brought this idea to the Granholm administration, which helped them implement it.

A spokesman for Mott Community College today told Mackinac Center Communications Specialist Kathy Hoekstra that the college’s Board of Trustees had voted unanimously Monday night to dissolve the so-called “interlocal agreement” that had created the MHBCCC. The DHS spokesperson likewise confirmed that the agreement was terminated, saying the termination would take effect on March 7.

 “Tens of thousands of Michiganders were targeted and millions of dollars were misappropriated in order to help political allies of former Gov. Granholm,” said Wright. “This was shameful, and we are glad to see it end.”

But more needs to be done to prevent home-based day care providers and those in comparable situations from similar partisan efforts, Wright added. “The Legislature needs to make certain that this cannot happen to anyone else. Will doctors, landlords and grocers be the next victims of opportunistic public employee unions?”

Wright also indicated that his clients’ legal options are now being reviewed. In addition to the lawsuit filed by Mackinac Center Legal Foundation, the illegal arrangement also prompted an ongoing federal lawsuit by the National Right-to-Work Legal Defense Foundation on behalf of several Michigan clients.


Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.