The next major labor dispute in Michigan won't be about wages or workplace safety. It will center on a single question: should state and local governments need union permission before using artificial intelligence?
The Michigan Civil Service Commission formed a task force on May 13 to review its contracting practices. The resolution creating the group did not mention AI. Union leaders immediately pushed to change that.
"When an AI system performs work that would otherwise be done by a classified employee, that is subcontracting," said Joseph Bellgowan, a labor relations specialist with SEIU Local 517M. Bellgowan argued that AI should fall under existing contracting rules and called on the task force to evaluate how state departments use it.
The Commission oversees rules and working conditions for roughly 50,000 state employees across agencies like corrections, health and human services, and transportation. It negotiates collective bargaining agreements with several unions and manages regulations that determine when agencies can outsource work instead of using government personnel.
Who sits at the table
State personnel director John Gnodtke will chair the new contracting task force. Each union will appoint a member. The Office of the State Employer, which handles negotiations with unions, will select five additional participants. The group will summarize the history of state contracting, weigh its benefits and tradeoffs, and recommend regulatory changes.
State and local governments are testing AI tools to see if they improve efficiency. The logic is straightforward: if an agency adopts AI, it might need fewer public employees for certain tasks. Whether agencies would actually shrink as much as unions fear remains unclear.
A familiar script
Unions across the country are raising alarms about AI's effect on the public workforce. Washington state lawmakers are considering a bill that would require state and local governments to bargain over AI adoption. The American Federation of Teachers published a report in August 2025 recommending that unions negotiate over a range of AI-related issues.
"Without strong labor protections and union involvement in decision-making," the AFT report said, "AI can become a tool for cost-cutting at the expense of jobs, wages and working conditions."
The debate echoes an earlier technological shift - the standardized shipping container. Before the 1950s, longshoremen at major U.S. ports unloaded cargo crate by crate. Then trucking company owner Malcom McLean pushed for a standardized container that could be loaded onto a ship, stacked with identical units, and moved by crane to a train or truck. The innovation slashed shipping times and costs. It also roiled labor tensions. The International Longshoremen's Association and the International Brotherhood of Teamsters saw the container as a job-killer and resisted its adoption. The innovation eventually prevailed because it served consumers and the broader economy.
The policy choice ahead
AI for Government use is expanding, and the Michigan task force will face a core tension. Policymakers can judge technology by whether it preserves existing government jobs, or by whether it helps the state deliver better services at lower cost. Union demands, the argument goes, should not block tools that serve the public.
For government professionals watching this unfold, the Michigan case is not an isolated skirmish. It previews a structural fight that will reach statehouses, city councils, and agency offices nationwide.
Why this matters for government employees
The task force's recommendations could set a precedent for how public-sector unions influence technology adoption. If the Commission decides AI tools count as subcontracting, agency leaders may need union approval before deploying even routine automation. That adds a layer of negotiation to every efficiency effort. Government managers and staff should track the task force's work - and consider how their own agencies classify AI-driven tasks under existing labor agreements. Proactive clarity now avoids gridlock later. For those shaping these decisions, an AI Learning Path for Policy Makers offers grounding in what the technology actually does before bargaining positions harden.
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