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Latest News - April 2012

April 10, 2012
Money no longer being diverted from the disabled to unions
Source: Marquette Public Policy Examiner
By: Pete Makin

A deal that funneled millions from the caregivers of the developmentally disabled to union coffers is over. Those receiving funds to care for children or family members will no longer have funds taken from their Medicaid payments go toward union dues.

Today Gov. Rick Snyder signed Senate Bill 1018, sponsored by Sen. Dave Hildenbrand, R-Lowell, creating Public Act 76. The Act amends the Public Employment Relations Act (PERA) to clarify that those simply receiving a government subsidy are not to be considered public employees.

"Those employed by private individuals cannot become public employees simply by receiving government dollars," Snyder said at the signing. "I am pleased this bill will return the interpretation of the law to its initial intent."

In 2005, the Michigan Quality Community Care Council (created by a Lansing-area aging consortium and the Department of Community Health) voted to recognize the SEIU as the bargaining representative of home healthcare providers. The home caregivers are supported by funding channeled through the Department of Community Health, but are actually individually employed.

Sen. Hildenbrand thanked the governor for signing the legislation he spearheaded to eliminate what he called a "back-room deal".

"We exposed a back-room deal that allowed money to be taken from home health workers; mostly private people caring for a loved one; to go to public employee union dues," Hildenbrand said. "(The Department of Community Health) was collecting union dues from subsidy payments. That would be like pulling union dues from payments to hospitals and any other group that receives government subsidies."

The Mackinac Center for Public Policy alleges that as much as $29.6 million has been "skimmed" from home care subsidies since 2007. According to Patrick Wright, director of the Mackinac Center Legal Foundation, that amounts to more money going directly to Michigan's roughly 60,000 home health care aides to provide services to needy Medicaid recipients.

“Ending this lucrative charade is terrific news for Michigan’s home health care providers who have seen nearly $30 million skimmed from their payments over the last six years,” said Wright. “The designation of these private contractors and family members as government employees was illegal from the beginning.

Wright charges that collecting union dues for the Service Employees International Union (SEIU) was unconstitutional.

"Michigan’s Constitution explicitly states that only the Legislature can define government employees," Wright said. "No political arrangement or interlocal agreement can change that. Now that the law has been clarified, the dues skim must end."

A telephone call and email request to the SEIU's media spokesperson were not returned today.

The Mackinac Center in a release today explained that there is no actual employer of the thousands of home health providers. Up until the Granholm administration made changes in 2007, they were considered self-employed, independent contractors. Most of those receiving subsidies are family members caring for disabled children, parents or grand parents.

This is the third time the Snyder administration has addressed what critics call "stealth unionization". On March 1, Snyder issued an executive order directing union dues to no longer be deducted from home-based daycare providers. On March 13, the Governor signed a law directing that graduate student research funding does not make those students state employees eligible for unionization.

The strategy varied slightly in each case, but was generally the same: An entity like the Michigan Quality Community Care Council, created by a small interest group, would then claim to represent a much larger group receiving state funding. Mailers would go out announcing a vote to unionize, and in each case a large number of mail received back would favor unionization, while the vast majority would not communicate either way.

In the case of the home health providers, the SEIU conducted a vote in 2007. 7,900 voted on the proposal with 6,900 voting in favor of it. Still, a little over 36,000 providers did not weigh in either way. The Mackinac Center Legal Foundation represented a number of people in each of the three categories who felt they were unionized against their will.

“Government-sector unions are clearly trying to expand the definition of government employees in order to grow their membership and direct taxpayer money into their coffers,” said Wright. “If business owners, the self-employed, family members and students can be roped into such schemes, then grocers, doctors, landlords and anyone else who receives a direct or indirect payment from the government can’t be far behind.”

Under Article IV, Section 48 of the Michigan Constitution, only the state Legislature can create state employees. In 1965, the Legislature adopted PA 379, the Public Employment Relations Act, which gives the Legislature alone the power to "enact laws providing for the resolution of disputes concerning public employees".

Officials now say that what remains now is to go over, and perhaps even audit, the budget of the Department of Community Health to ensure millions of tax-dollars go to the needy families of the developmentally disabled.

"It amounts to a lot of money being diverted away from its original intent," Hildenbrand said. "But I don't care if it was $100 dollars or $100,000 dollars. It's just wrong."




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