SEIU Healthcare Michigan is under trusteeship once again

SEIU Healthcare Michigan is under a trusteeship for the second time in five years over claims of financial mismanagement, according to a letter from its international parent organization, which has installed new overseers.

The letter, available on SEIU’s website, says that new trustees were appointed effective April 27. Their job, SEIU International President Mary Kay Henry writes, is “to provide the leadership and resources necessary to investigate and correct possible financial malpractice.” The new trustees are also to make sure that the Michigan local’s fund are not misappropriated. SEIU Healthcare Michigan was also placed in trusteeship in 2017 due to financial malpractice.

In the early 2000s, SEIU locals across the country, including its Michigan affiliate, took millions of dollars from people who were getting paid by Medicaid to care for their disabled family members in their own home. The union did this by enrolling these caregivers as members, usually without their consent, in a tactic widely known as a ”dues skim.” In Michigan, this diversion came to an end in 2012 when the state amended Michigan’s Public Employment Relations Act. The law now prohibits unions to force home-based day care providers and home health caregivers to sign up and pay union dues.

Henry wrote in her letter that the current trusteeship is made necessary by “substantiated allegations of serious financial malpractice.” She said there is strong evidence that the Michigan local lacks internal financial controls and has inadequate accounting systems. The SEIU International president also says it is not clear whether leaders of SEIU Michigan Healthcare formally adopted a budget for the last three years. All the union’s officers, executive board members, trustees and representatives were removed from their positions, according to the letter.

The trustees, according to Henry, are “to provide the leadership and resources necessary to investigate and correct possible financial malpractice.”

SEIU Healthcare Michigan had a record high of 57,239 members in 2010. It had 55,265 in 2011, but that number plummeted to 10,918 members by 2014, two years after Michigan amended its public relations labor act. The union had 5,917 members as of March 30, about a tenth of what it had in 2010.

The decline in membership has meant a significant decrease in its finances. The Michigan union had $3.2 million in assets as of Aug. 13, 2009, but it now has $722,252. It had $15 million in receipts for 2009 and disbursements of $15.6 million. As of March 30, 2002, it has $3.8 million in receipts and $3.9 million in disbursements.

SEIU did not respond to a CapCon request for comment.

Jamie A. Hope is assistant managing editor of Michigan Capitol Confidential. Email her at hope@mackinac.org.