July 10 update: The daycare will remain open thanks to interim financial support from the City of Vancouver and the Central City Foundation.

Parents and union officials are raising questions about a prominent East Vancouver daycare's decision to close its doors just days after its workers applied to join a union.

The Vancouver Native Health Society, which runs the Phil Bouvier Family Centre daycare, sent a letter Monday citing "problems and hardships" for the closure.

"As a not-for-profit society, there is only so much we can do with the funding we are given and unfortunately the daycare has proved to be incapable of running at a sustainable financial level," the letter read. "This has led to an untenable situation where we are not providing you with the level of service originally contemplated when the daycare opened."

For parents relying on the centre, the news was devastating.

"I was shaking. I was ready to cry," said Angela Giannoulis, whose son, Nikolas, attends the daycare. "I just didn't know what to do. I really was beside myself."

Located in the city's Strathcona neighbourhood, the high-profile, non-profit centre bills itself as one of two in the city that focus on Indigenous children.

But Giannoulis said she and other parents have been expressing concerns over how the daycare was being run for the past year and a half.

On May 29, Giannoulis sent the society a letter drafted by a group of parents, outlining their concerns, including "reduced hours causing extreme hardship to families," "children not receiving meaningful development and education" and staff who are "tried and stressed."

That same day, daycare employees took action of their own, going to the British Columbia Government and Service Employees' Union.

"There are about 37 employees and they came to us at the BCGEU and indicated that they were interested in organizing and having union representation, so we filed an application at the labour board," said union president Stephanie Smith.

"Honestly, they saw us an advocacy organization, helping them provide quality service to the families that they support."

On May 30, just a day later, the VNHS's board met and voted to close the daycare.

"I don’t understand the timing of this,” Smith said. “If you were to look at what throwing out babies with the bathwater would look like, this would be an example,”

"The fees are in-line with other centres in Vancouver,” Giannoulis said. “How is it that other centres are able to work with the same amount of spaces?"

So far the Vancouver Native Health Society hasn’t commented on parents’ concerns or its decision to close the centre.

Smith said the BCGEU is now looking at legal options and the application is set to go before the labour board Friday.

In the meantime, Giannoulis and other parents are worried they'll be left scrambling to find child care in a city where families can be forced to wait years for a space to open up.

"At the bottom of the letter it says that their focus is going to turn into an Aboriginal drop-in centre," said parent Lorea Ytterberg, whose two-year-old Charlie attends full-time. "Immediately, I was like well what about the Aboriginal children and families that are going to the daycare?"

Giannoulis said the shutdown might even force her husband to take a leave of absence from work in order to care for their son.

"It's so hard right now," she said." You go in there and everyone is so defeated and the morale is terrible. The kids are suffering, the teachers are suffering, the families are suffering."

Officials at both the local and provincial levels weighed in Wednesday, but offered no clear solution to the situation.

"The Province and City share parents’ concerns over the closure notice of Vancouver Native Health Society’s (VNHS) Phil Bouvier Family Centre and are working with all partners to explore community-based options for keeping the 49 valuable childcare spaces available to families who need them most," the City of Vancouver and the Ministry of Children and Family Development said in a joint statement.

"We are hopeful all parties can come to a resolution that allows this childcare centre to continue operating as the Province and City continue to support the need for adequate and culturally safe early care and learning supports for urban Indigenous families in keeping with a commitment to reconciliation."

According to the statement, the centre has received $900,000 in provincial funding since 2004-05. The city contributed another $350,000 during the same period.

In 2007, the local government also approved a $200,000 grant for renovations to the space.

But no matter what happens to the centre, the parents say they won't stop fighting to save what matters most.

"We have to fight for this," Ytterberg said. "We're not going backwards."

With files from CTV Vancouver's David Molko