News Story

Union Omits $12K From Disclosure Form That Was Paid to Keep Health Care 'Dues Skim' Alive

If payment made in 2011 and not reported, it’s ‘very serious,’ labor expert says

(Editor’s note: The story below has been edited to represent new information received since publication. Because the SEIU did not respond to requests for comment, additional FOIAs were submitted for information about payments the union made to the MQC3. Records subsequently showed that the MQC3 recorded a $12,000 payment from the SEIU in February 2012. The date this payment was made is unclear. Further information requests have been made to get more information on the accounting of the money the union paid to the MQC3.)

Something appears to be missing from the 2011 disclosure report filed by the union that profits from the "home health care dues skim," which has taken more than $30 million that could directly benefit homebound residents in Michigan.

The report fails to mention the $12,000 the Service Employees International Union gave to the dummy employer to allow it to keep operating and to keep the "skim" from ending last year.

"Not reporting income or expenditures on union finances is very serious," said Vincent Vernuccio, director of labor policy at the Mackinac Center for Public Policy. "Workers forced to pay labor organizations simply to keep their jobs and taxpayers compelled to subsidize them have a right to know where the money comes from and where it goes. Failure to report can result in criminal penalties for responsible union officers.

"If the SEIU failed to report expenditures to the MQC3 (Michigan Quality Community Care Council), the Department of Labor should commence an immediate investigation to see what else has not been reported," Vernuccio said.

Under a scheme crafted in 2005 while Jennifer Granholm was governor, tens of thousands of so-called home health care workers were forced into the SEIU after a vote most were unaware was even happening. As a result, dues from the taxpayer-provided checks of those who care for homebound patients continues to be sent to the union.

In 2011, Michigan's Legislature de-funded the Michigan Quality Community Care Council, which should have ended the scheme. However, the SEIU gave it at least $12,000 to keep it operating. According to emails obtained through Freedom of Information Act requests, Susan Steinke, executive director of MQC3, informed the MQC3 board of directors of the $12,000 donation from the SEIU.

The SEIU and its affiliates are required to file annual disclosure reports with the federal Office of Labor Management Standards, which are known as LM-2s and are available online.

It should be noted that these reports are specific. Everything is supposed to be reported, from the $38,330 the union paid to the Doherty Hotel in Clare for example to the $6,008 it spent for rental of office machines in Muskegon. Even the cost of office furniture appears in the LM-2 reports.

However, the $12,000 donation to MQC3 Steinke reported is absent from the 2011 LM-2 report filed by SEIU Healthcare Michigan, the affiliate that is sent dues from the “skim.”

Zac Altefogt, communications director for SEIU Healthcare Michigan, did not return a phone call seeking 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.