Michigan Civil Rights Act and Employee Benefits
How the Elliott-Larsen Civil Rights Act, including the 2024 additions for sexual orientation and gender identity, touches eligibility, contributions and plan design for Michigan employers.
What the Michigan Civil Rights Act Means for Benefits
The Elliott-Larsen Civil Rights Act is not a benefits law, but it governs how an employer treats people in compensation and the terms and privileges of employment, and benefits are part of that.
What the Act Is
Elliott-Larsen Civil Rights Act (1976 PA 453, MCL 37.2101 and following) is Michigan’s main civil rights statute. For employers it prohibits discrimination in hiring, firing, compensation and the terms, conditions and privileges of employment. Benefits are part of compensation and employment terms, so plan rules fall within the Act.
Who Is an Employer
The Act defines an employer as a person that has 1 or more employees. Unlike many federal employment laws, there is no 15-employee or 50-employee threshold, so it reaches small Michigan employers. Employers with only a handful of employees should not assume the federal thresholds apply to them.
Why It Touches Benefits
Section 202 bars discrimination in compensation and in the terms, conditions or privileges of employment. It also addresses sex discrimination in terms of employment, including a benefit plan or system. Eligibility, contribution and plan-design choices are therefore in scope. Counsel can help test specific plan designs.
What Changed in 2024
Public Act 6 of 2023, effective February 13, 2024, added sexual orientation and gender identity or expression to the classes the Act protects, alongside religion, race, sex and the other existing classes. Review handbooks, plan definitions and enrollment forms for language that has not been updated since then.
How the Act Defines the New Classes
Sexual orientation covers an orientation for heterosexuality, homosexuality or bisexuality, a history of one, or being identified with one. Gender identity or expression means having or being perceived as having a gender-related self-identity or expression, whether or not it matches sex assigned at birth.
Pregnancy and Childbirth
The Act defines sex to include pregnancy, childbirth and related conditions, and requires that an employee affected by them be treated the same for employment purposes as others similarly able or unable to work. Review leave, disability and medical benefit rules to confirm they treat pregnancy-related conditions consistently with other temporary conditions, and ask counsel about specifics.
Where This Shows Up in Your Benefits Program
These are the places we see the Act matter in practice. None of this replaces advice from your employment attorney.
Eligibility Definitions
Look at how your plan documents define dependents, spouse and domestic partner, and at waiting periods and class definitions. Apply the written terms the same way to every employee. Document who decided each definition and why, so the rules can be explained if questioned.
Contribution Strategy
Employer contribution tiers should rest on job class, hours or another documented, neutral basis. Examples include a class defined by role, a minimum number of scheduled hours, or a union group. Write the basis down, apply it the same way to everyone in the class, and have counsel review any tier that varies by a personal characteristic.
Fully Insured vs. Self-Funded Plans
A carrier’s plan exclusions in a fully insured plan are set by the carrier and filed with the state. In a self-funded plan the employer designs the exclusions and carries more of the decision, so counsel review matters more. Ask counsel to review exclusions in either case before they are communicated to employees.
Leave and Pay Practices
Pregnancy-related leave, sick time and short-term disability practices should treat pregnancy like other temporary conditions. See our earned sick time guide.
Applicant Screening Questions
Interview and onboarding forms should not ask about the protected classes. Benefits enrollment forms are collected after hire and should only collect what the plan needs. Keep benefits questions on a separate form from anything used to evaluate candidates, and limit who can see the answers.
Federal Overlay
Federal law, including Title VII for employers with 15 or more employees, covers similar ground. A Michigan employer can be subject to both, so treat the stricter standard as your working rule. Compare your handbook and plan rules against both standards and ask counsel where they differ.
Remedies and What We Have Not Confirmed
We confirmed the points below against the Act’s text. Anything not listed here, such as filing deadlines, belongs with your attorney.
Civil Action
Section 801 lets a person alleging a violation bring a civil action for appropriate injunctive relief or damages, or both. Damages include injury or loss caused by each violation, including reasonable attorney fees. A claim of this kind is a legal matter, so involve counsel early rather than after a demand arrives.
Costs
Section 802 lets a court award costs, including attorney and witness fees, to the complainant where appropriate. Fee shifting adds to the cost of defending a claim even when the plan design was well intended, which is one more reason to review plan rules and keep clear records.
Filing Deadlines
Michigan Department of Civil Rights guidance says a complaint generally must be filed within 180 days after the alleged act of discrimination. The same guidance indicates a court lawsuit may generally be filed within three years, and that a court case can proceed without first filing with the department. Deadlines can vary by claim, so confirm the timing with your employment attorney.
Exemptions
The Act includes limited exemptions, such as a bona fide occupational qualification that an employer may request from the commission. Other exceptions can apply to particular employers or situations. How any exemption applies to a benefit plan design or eligibility rule is a legal question, so take specific situations to your employment attorney before relying on one.
Who Handles Complaints
The Michigan Department of Civil Rights handles formal complaints under the Act. Route any complaint to your attorney promptly and do not respond to it as an HR matter alone. Keep any notices or letters you receive in one file so your attorney has the full picture.
What We Do and Do Not Do
We are benefits advisors, not attorneys. We can help you review plan definitions and carrier exclusions and can bring in the attorneys available to our clients for the legal read. Raising a question early is usually easier than correcting a problem after an employee has raised it.
Questions Michigan Employers Ask
Does the Michigan Civil Rights Act Apply to Small Employers?
Yes. The Act defines an employer as a person with 1 or more employees, so there is no minimum headcount.
When Did Sexual Orientation and Gender Identity Become Protected?
February 13, 2024, the effective date of Public Act 6 of 2023.
Does the Act Require My Plan to Cover Specific Treatments?
The Act is a nondiscrimination law, not a coverage mandate. Coverage mandates for fully insured plans sit in the Insurance Code. Whether a particular exclusion creates exposure is a question for your attorney.
Can I Offer Different Contributions to Different Employees?
Contribution differences should rest on documented, neutral classes such as job category or hours.
Do Dependent and Spouse Definitions Matter?
Yes. Review the written definitions and apply them uniformly. Have counsel review any definition that treats employees differently by a protected class.
Does the Act Affect Short-Term Disability and Leave?
It requires that pregnancy and childbirth be treated like other temporary conditions for employment purposes. Check your short-term disability and sick time policies against that standard.
What Is the Deadline to File a Claim?
The Department of Civil Rights says a complaint generally must be filed within 180 days of the alleged discrimination, and a court lawsuit may generally be filed within three years. Exceptions and different federal deadlines can apply, so check the timing with your employment attorney.
Is This Legal Advice?
No. This guide is for general information from benefits advisors. Consult an employment attorney for your situation.
Related Guides
Related reading: Michigan Benefits Compliance Hub · Michigan Earned Sick Time Act · Payment of Wages and Fringe Benefits Act · Mental Health Parity Law · PWFA and PUMP Act Rules for Employers · Cannabis and Drug Testing Policies for Michigan Employers · Gender-Affirming Care Coverage in Employer Health Plans
The rules in one place.
Michigan Employer Benefit Laws
Wages, sick time, civil rights and coverage mandates, in one place.
Where the Rules Come From.
The laws and rules named on this page link to the statute or regulation they come from. This is general information, not legal or tax advice, and rules change, so check the current text.
Mental Health Parity (29 U.S.C. 1185a)
Parity rules for mental health and substance use disorder benefits in group health plans.
Title VII of the Civil Rights Act (42 U.S.C. 2000e)
Prohibits employment discrimination, including pregnancy-related discrimination in benefits.
Michigan Earned Sick Time Act (MCL 408.961)
Michigan law on paid sick time accrual, use and notice.
Elliott-Larsen Civil Rights Act (MCL 37.2101)
Michigan’s civil rights law covering employment discrimination.
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