News Story

DHS Finishes Off Forced Unionization Experiment

After repeated efforts to kill it in the Legislature and in court, the “stealth unionization” movement in Michigan was knocked down decisively on Tuesday when the Michigan Department of Human Services put an end to the Michigan Home Based Child Care Council. DHS Director Maura Corrigan, recently appointed by Gov. Rick Snyder, said the department will no longer fund the MHBCCC or collect union dues from child care providers.

The DHS began the stealth unionization of child care providers in 2006 when the department was under the control of the administration of then-Gov. Jennifer Granholm. Granholm boasted at a union convention that the organization had netted the state 45,000 more AFSCME union members. E-mails sent by union officials described the MHBCCC as an “experiment” with the support of Michigan AFSCME, the UAW and the governor’s executive office.

That experiment came to an end on Tuesday.

“[We] will stop all funding and, because these providers are not state employees, will also cease collecting union dues,” Corrigan said in a news release, effectively ending the dispute over whether many otherwise private day care business owners were part of a government employee union.

The far-reaching implications of the stealth unionization plan were revealed this past summer when a union lawyer told a judge that Michigan could even unionize doctors if the physicians took payment via state subsidies. The admission came from attorney John West when questioned by U.S. District Court Judge Robert Jonker in a case involving the stealth unionization of the home-based day care providers. The case was filed by the National Right to Work Legal Defense Foundation.

West’s response raised concerns that the state could conceivably unionize and then extract dues from everyone from doctors that accept Medicaid to grocers that take food stamps to landlords that take housing assistance.

The Mackinac Center filed the original lawsuit against the Department of Human Services after some of the forcibly unionized child care providers complained that they were unionized against their will.

The MHBCCC was created in 2006 as the result of a convoluted interlocal agreement between DHS and Mott Community College. The MHBCCC was set up to serve as the “employer” of 40,000 home-based day care providers in the state, many of whom are otherwise private business owners. Only 6,300 members participated in the vote for unionizing and many day care providers didn’t even know they were in the union until notified after the vote had concluded. The state took about $2.5 million in dues each year from the home-based day care providers who received payment in the form of state subsidies on behalf of their low-income clients.

But Tuesday’s news release from new DHS Director Maura Corrigan said the MHBCCC had failed to enhance or improve the delivery of quality care for children.

“This is fantastic news,” said Mackinac Center Legal Foundation Director Patrick J. Wright in a press release. The Mackinac Center Legal Foundation represented 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.”

Loar was the first to bring the “stealth unionization” to the attention of the Mackinac Center.

“I’m thrilled,” Loar said in the press release. “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.”

A phone message and e-mail left at the Michigan Home Based Child Care Council offices were not returned.

The current saga of forced unionization appears to be at an end because of the administrative reversal of course at DHS due to the new leadership of Corrigan, less than two months after she was appointed by Gov. Rick Snyder. However, absent an explicit legal prohibition, another DHS director appointed by a future governor could conceivably reverse course yet again and attempt to reinstate the policy. Numerous legislative attempts to kill the MHBCCC failed during the final years of the Granholm administration.

Two bills that have been introduced in the Legislature appear aimed at putting a legal roadblock in the path of future forced unionization efforts.

State Rep. Paul Opsommer, R-Dewitt, introduced 2011 House Bill 4003; and state Sen. Mark Jansen, R-Gaines, introduced 2011 Senate Bill 11. According to, both bills would “establish that a person whose private employment compensation comes from a direct or indirect government subsidy is not considered a government employee, and so is not subject be being inducted into a government employee union.”

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.