News Story

SEIU Sues State, Governor to Keep Home Health Care 'Dues Skim' Money Flowing

The union that was taking money from the state subsidy checks of 60,000 home health care workers has sued Gov. Rick Snyder and the state Department of Community Health a few days after the Attorney General ordered an end to the practice.

The Service Employees International Union Healthcare Michigan lawsuit claims the state is ending an existing collective bargaining agreement and is in violation of the contract clause of the U.S. Constitution. The SEIU has taken more than $30.4 million from the home health care aides since late 2006.

A judge has put disputed union dues of $500,000 — the amount taken since Attorney General Bill Schuette ordered an end to the scam — in an escrow account, said Patrick Wright, the Mackinac Center for Public Policy’s senior legal analyst.

"It is not surprising that the union wants to keep its skim running,” Wright said. “The key to this case will be showing the court that the home health workers are not now and have not ever been public employees."

Attorney General Schuette issued a binding opinion letter May 25 that stopped state agencies from withholding money from Medicaid checks and handing it over to the SEIU. Earlier, the legislature passed Senate Bill 1018 which became Public Act 76 of 2012 that stated that a person whose private employment compensation comes from a direct or indirect government subsidy can’t be considered a government employee.

The SEIU was taking dues under a complicated scheme started under the administration of Gov. Jennifer Granholm. An interlocal agreement was created between the Department of Community Health and the Tri-County Aging Consortium. Then the Michigan Quality Community Care Council was created. The MQCCC served as the shell employer for self-employed independent contractors. Many of the individual contractors were family members caring for loved ones.

The SEIU Healthcare Michigan Union representatives didn’t return a message left at their office. Gov. Rick Snyder’s Spokeswoman Joy Yearout declined comment.

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.