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Under current Michigan law this is an interesting question without a clear-cut answer at the present time – ultimately, I think that sexual harassment claims could potentially fall under the Workers’ Compensation Act, though there are lots of caveats. We have case law precedent in Michigan regarding physical assaults that are non-sexual in nature, where the holding has been that if the assault is connected to the employment in some manner, the victim could recover workers’ compensation benefits, but if the assault is “motivated by personal reasons” (Devault v GMC, 149 Mich App 765, 386 NW2d 671 (1986)), it would not be considered to be a workers’ compensation claim due to the fact that the activity would not be considered to “arise out of employment,” as required by the Michigan Workers’ Disability Compensation Act. I suspect that the facts would vary on a case-by-case basis to determine whether the requirement of “arising out of employment” is met, but that sexual assault/harassment cases would be analyzed the same way. The harassment would also have to cause disability to the general labor market, since Michigan is a wage-loss state, in order to be fully compensable – in other words, the individual would have to be restricted from working in ALL labor settings, and not just with restrictions to avoid a certain boss or co-workers who fostered and/or caused the harassment.
There could also be a potential issue with the exclusive remedy provision of the Act – if it’s not a workers’ compensation case, obviously the employer is opened up to general tort liability – previous cases involving allegations of false imprisonment and intentional infliction of emotional distress have proceeded in civil courts outside of the WC system on the basis that there are (were – cases were from 1971 and 1984) no remedies for those specific claims under the WDCA. In the latter case, Schutt v Lado, 138 Mich App 433, 360 NW2d 214 (1984), there were other alleged torts of assault and battery dismissed from the civil suit on the basis that those aspects of the claim WERE covered by WC. So, it looks like it could go either way based on the specific facts of a specific case according to those holdings as well.