AI Laws in Michigan (MI)

What HB 5891 requires

Michigan has enacted HB 5891 — AI in Employment. Employers using AI for screening must disclose to candidates and provide appeal process. This page explains what the law requires in plain language, who is in scope, the penalty for non-compliance, and what your business needs to do before the 2027 deadline.

Who is in scope

The law covers any business in Michigan that uses algorithmic tools to screen job applications, score interviews, rank candidates, evaluate employee performance, or make promotion and termination decisions. Company size does not determine whether you are in scope — a startup with ten employees using an off-the-shelf AI hiring tool has the same disclosure obligations as an enterprise running a custom-built model. What matters is whether the AI system makes or substantially informs a decision that affects a Michigan resident in a consequential way. Notably, the obligation extends to vendors: if your company deploys an AI tool built by a third party, you — as the deployer — are responsible for ensuring it meets Michigan's requirements, even if you did not build it.

Key compliance requirements

Michigan's employment AI rules create concrete pre-deployment and ongoing obligations. Before any AI tool enters the hiring or performance-management pipeline, employers must be able to document what data the system uses, how it reaches a decision, and what steps have been taken to detect and mitigate bias. Affected candidates and employees are entitled to notice that AI is involved — that notice must be provided before the AI evaluation takes place, not after an adverse decision has already been issued. Many employment AI statutes also require that a human reviewer be available to consider any appeal of an AI-assisted adverse action, preventing a loop where an algorithm's decision becomes final with no meaningful override path.

Penalties for non-compliance

Michigan's AI law gives the state attorney general authority to investigate violations and seek civil relief. While statutory penalty amounts are still being finalized by implementing regulations, enforcement precedent from early AI cases in other states suggests regulators will prioritize companies with the widest reach and the most significant consumer impact. Employment AI violations often trigger parallel exposure: an employer who fails to provide required notice faces state penalties AND increased litigation risk under federal equal-employment law, because documented failure to audit for bias can be used as evidence of disparate-impact intent in private lawsuits.

What to do now

Build your AI inventory first. You cannot comply with Michigan's requirements if you do not know which systems are in scope. Map every AI or automated decision system your company uses that touches Michigan residents — including third-party vendor tools integrated into your product.

Audit hiring tools before the deadline. Commission or conduct a bias audit on any resume screener, interview scorer, or performance-management AI. Document the methodology, the demographic breakdown of outcomes, and the steps taken to mitigate any identified disparities.

Implement candidate and employee notice. Update job postings, onboarding materials, and performance-review workflows to include required disclosures. Verify that the notice is delivered before the AI evaluation occurs.

Assign a compliance owner. Designate someone — legal counsel, a privacy officer, or a dedicated AI governance lead — to track regulatory developments, own the audit documentation, and respond if an enforcement inquiry arrives. The compliance deadline is 2027. Don't wait until the deadline to start.

Michigan AI law in the broader regulatory landscape

Michigan's law does not exist in isolation. The trend across the United States is toward more regulation, not less: at least 20 states enacted or proposed AI-specific legislation in 2025 alone, and federal enforcement agencies — the FTC, EEOC, CFPB, and HHS — have all issued guidance making clear that existing laws apply to AI systems even where no AI-specific statute exists. Companies doing business across state lines must track each state's requirements independently — there is no federal preemption that would allow a company to satisfy Michigan's law and automatically comply with requirements in Illinois, Colorado, or New York.

The EU AI Act applies to any company serving EU customers, even if you're based in Michigan. Penalties reach €35M or 7% of global revenue. Deadline: August 2, 2026.