The state of Michigan says it will stop deducting union dues from thousands of people who provide day care at home.

The head of the Department of Human Services says at-home providers are private businesses, not state employees. The decision means two unions will lose millions of dollars, an arrangement that was created under former Gov. Jennifer Granholm, a Democrat and union ally.

Human Services chief Maura Corrigan, a Republican, says the state also is ending its relationship with the Michigan Home-Based Child Care Council, which was affiliated with Mott Community College.

In a statement Tuesday, Corrigan said the council has not improved the quality of day care.

More than 16,000 at-home day care providers paid union dues if they received state subsidies for watching kids from low-income families.