MERC Mistake Stands – SEIU Keeps $34M

Michigan Employment Relations Commission Fails to Correct Its Own Mistake in Unionization of Home-Based Caregivers

SEIU allowed to keep $34 million in forced dues after MERC dismisses administrative action

mac-logoMIDLAND — After inappropriately setting up and administering a union certification election for home-based caregivers in 2005 — despite them not being public employees — the state agency responsible for that action, the Michigan Employment Relations Commission, today claimed itself unable to rectify its own error, thereby allowing the Service Employees International Union to keep some $34 million it improperly received in dues. MERC dismissed an administrative action brought by the Mackinac Center Legal Foundation on behalf of Patricia Haynes and Steven Glossop that sought to have the 2005 union certification declared illegal and have a portion of the dues returned.

“All of this could have been avoided if MERC had acted competently in 2005 by addressing whether the caregivers were public employees,” noted Patrick J. Wright, director of the MCLF.  “In today’s order, MERC does not contend that these home-based caregivers were public employees in 2005 because it cannot do so. Instead, MERC attempts to mask its previous failure by setting forth a disappointing order that incorrectly cites statute of limitations and other procedural hurdles and fails to address the central issue of whether our clients were ever public employees.”

The Mackinac Center Legal Foundation last September asked MERC for a declaratory ruling to reverse its 2005 decision that allowed the forced unionization of some 40,000 home-based caregivers. Most of those who were caught up in the SEIU’s scheme were family members and friends caring for the state’s most vulnerable residents.

“It was apparent at the time that there was an exceedingly strong legal argument that these caregivers were not public employees under Michigan’s public-sector labor law,” Wright added. “When such jurisdictional matters occur, there are centuries of cases indicating that MERC must address the question, even though the Granholm administration and the SEIU tried to downplay it.”

The stealth unionization scheme began during the administration of former Gov. Jennifer Granholm when a shell corporation, the Michigan Quality Community Care Council, was created by an interlocal agreement between the Michigan Department of Community Health and the Tri-County Aging Consortium. Gov. Rick Snyder signed legislation in April 2012 making it clear that these home-based caregivers were not public employees and therefore could not be forced into a government union. That was later upheld by an opinion from Attorney General Bill Schuette.

The dues skim, however, was allowed to continue after a federal judge granted an injunction against the law. The SEIU at the time argued that cutting off the money would hamper the union during the 2012 election. Voters last November overwhelmingly rejected Proposal 4, which would have enshrined the forced unionization scheme in the Michigan Constitution.

The dues skim funneled more than $34 million to the SEIU before it came to an end last month.

“We’ll review MERC’s order before deciding what legal options to pursue,” Wright said. “Unfortunately, a lot of money that was supposed to go toward the medical care of sick and developmentally disabled people ended up being spent on politics.”


The Mackinac Center for Public Policy is a research and educational institute headquartered in Midland, Mich. The largest state-based free-market think tank in the country celebrates its 25th anniversary this year.

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