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Employers Have Leeway on Marijuana Policies

Companies struggle to understand changing state laws on marijuana and related workplace policies.


Michelle Ustaszeski-Hutchinson was ready to start her job as a resident care assistant at a personalized senior care community in Richland, Pa., when the position went up in smoke.

Ustaszeski-Hutchinson said that during her pre-employment screening, which included a drug test, she presented her employers with her state medical marijuana card and sent a copy of it to the company's medical review officer, explaining that she uses marijuana to treat her post-traumatic stress and anxiety disorders. (Pennsylvania has a comprehensive medical marijuana program.) Two weeks later, she received an e-mail explaining that her conditional offer of employment had been rescinded.

After Ustaszeski-Hutchinson sued the company seeking lost pay and benefits, lost future pay, and compensatory damages, she settled for an undisclosed amount, according to Law360.

Nearly half of Americans live in states where marijuana is legal., and companies are struggling to understand what they're allowed to accept within the confines of the office.

Can an employer ban the drug, even if someone is using marijuana for medical purposes as prescribed by a doctor, such as to ease a migraine or the side effects of chemotherapy? Can employees take a puff whenever they feel the need? Should employers be barred from drug testing?

Answers to these questions, along with seemingly everything else cannabis-related, can be murky. But some facts are crystal clear: Marijuana is still a federally banned substance, and states are making their own marijuana laws. So, before employers start firing employees who fail drug tests or who appear to be hazy-eyed and sleepy, business leaders need to know the laws—and then determine how their organizations view the use of cannabis by employees.

"In general, each workplace environment is entitled to have and enforce its own policies, especially when it comes to private employers," says Michael O'Brien, CEO and general counsel at Sonoran Roots Craft Cannabis and a member of the Arizona Dispensaries Association board.

Widespread Legalization

Despite the federal ban, states are making their own laws on usage. Currently, recreational use of cannabis is legal in 21 states along with Washington, D.C., and Guam. Additionally, medical marijuana programs are sanctioned in 37 states, plus D.C., Guam, the Northern Mariana Islands, Puerto Rico and the Virgin Islands.

In the November elections, residents of Maryland and Missouri voted to legalize recreational marijuana. Voters in Arkansas, North Dakota and South Dakota rejected legalization proposals.

A recent survey found that most people agree that marijuana should be totally legalized. Nearly 9 out of 10 adults in the U.S. say that weed should be legal for recreational and/or medical use, according to the Pew Research Center.

Despite growing public acceptance of marijuana, employers have latitude on how to approach the issue. Most state laws give businesses the ability to maintain a drug-free workplace and prohibit the consumption of cannabis while at work, says Jennifer Fisher, partner and co-chair of law firm Goodwin's cannabis practice in San Francisco.

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Drug Testing

In 1986, President Ronald Reagan instituted drug testing for federal employees. By 1990, an estimated 43 percent of the largest U.S. employers (those with more than 1,000 employees) were mandating drug testing. Today, that number has dropped significantly. Just 16 percent of private sector employers of all sizes test for drugs and/or alcohol, according to a 2022 report by the Bureau of Labor Statistics. But if marijuana has been legalized in your state, can you legally fire someone for failing or refusing to take a drug test?

Employers are generally allowed to test employees for the presence of drugs, though in most cases they aren't required to administer tests at all. Most states impose some restrictions on testing, such as allowing it only when there is suspicion of substance use or following a workplace accident. The testing of employees in safety-sensitive jobs is commonly authorized, as well.

In Florida, former state correctional officer Samuel Velez Ortiz was dismissed after failing a random drug test last year, according to local news reports. At the time, he had a state medical marijuana card issued as part of the treatment for his post-traumatic stress disorder.

Attorneys for Ortiz wrote in a brief, "The [employer] attempts to cloud the main issue of this case by ignoring the fact that appellant was terminated for being a legal medical marijuana user."

But Ortiz lost his case. Maybe he should have checked his state's laws prior to taking the drug test. In Florida, employers are allowed to require job applicants to submit to random drug tests, and they are allowed to fire employees at will for failing those drug tests—even if workers have a valid medical marijuana card.

Indulging at Work?

Employers may choose to treat marijuana like alcohol and allow employees with medical marijuana cards to consume cannabis when they aren't working, so long as they aren't under the influence when they clock in to work. But the issue isn't always clear-cut, as demonstrated by a recent court case.

In Washington, D.C., where testing for marijuana use is allowed when there is a reasonable suspicion of drug use, the court nonetheless reversed the firing of a government employee who was suspected of being intoxicated on the job. The employee, who tested positive for marijuana but had a medical card, told her employer she hadn't used cannabis at the time of her testing but had consumed it over the weekend.

"Because [the] employee was allowed to perform her duties and did in fact adequately do so after being observed by her supervisors, I find that [the supervisors] did not reasonably believe that the employee's ability to perform her job was impaired," the municipal judge wrote in the ruling. "As such, I further conclude that a reasonable suspicion referral was unwarranted."

Employers generally are allowed to mandate a drug-free workplace during working hours. But "generally" is the key word.

It's tricky to determine whether an employee is actually under the influence of marijuana, because the drug can stay in a person's system for longer than 30 days. There isn't currently a test available to determine if someone is feeling the effects of the drug, and therefore, workplaces aren't able to accurately determine whether someone is totally sober at work.

"My hope is that, as things progress, there'll be a technological fix that will allow us to determine if a worker is under the influence, the way that we're able to do that with alcohol," said Douglas Parker, assistant secretary of labor for occupational safety and health, during Bloomberg Law's Leadership Forum in 2022.

Don't Be Hasty

Absent such a technological fix, employers should be slow to jump to conclusions.

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"A company needs to be careful when disciplining medical marijuana users," says employment attorney David Reischer, CEO of LegalAdvice.com. Many states have laws protecting medical cannabis patients from employment discrimination, though those laws are limited. For example, in Rhode Island, employers can't refuse to hire medical marijuana patients who don't pass a drug test. But the state doesn't allow anyone to undertake tasks when they are under the influence of marijuana if doing so would constitute negligence or professional malpractice. Plus, the law says, "nothing in this chapter shall be construed to require an employer to accommodate the medical use of marijuana in any workplace."

Confused?

"There is the legal answer, and then there is the practical answer," says Laura Bianchi, a partner with law firm Bianchi & Brandt in Scottsdale, Ariz.

Because marijuana remains illegal from a federal perspective, even with state protections, there are many nuances and exceptions to the laws, Bianchi says. Employers are within their rights to prohibit consumption while at work. If employees are impaired at work and consumption poses a safety risk or impairs their ability to perform the required functions of their job, an employer can terminate the employees for violating the policies, Bianchi says.

Translation: The laws are subjective, so employers need to clearly explain in their handbooks what they will and will not tolerate when it comes to marijuana use at work.

Employers should be slow to jump to conclusions regarding marijuana use.

These rules, however, must fall within the legalities of individual states.

If the employer is in Arizona, for example, it must understand that medical marijuana card holders are allowed to possess medical marijuana within the allowable limit. "However, the statutory protections do not extend to possession or consumption at the workplace during business hours," Bianchi says. "In these situations, the policies of the employer will likely dictate whether or not you may possess medical marijuana at your place of work."

If your company has offices in multiple states with differing drug laws, you can establish policies of your own—again, just make sure your employees understand those policies.

"Depending on the size of the company, the industry and those setting the policies at the company, this could vary from complete prohibition of employee use to a hands-off policy," O'Brien says. "If and when cannabis becomes federally legal, there will likely be overarching legal guidance that will apply for specific workplace issues, similar to how such laws and policies developed related to COVID." But that time has not arrived yet.

So, to be clear: Don't memorize the current rules or advice. "It's a constantly changing and evolving area of the law," Bianchi says, "so for most of our clients, it's an ongoing discussion."

Danielle Braff is a freelance writer based in Chicago.


Explore Further

SHRM provides resources and information to help business leaders stay informed about changing marijuana laws and their implications for the workplace.

 
California Law Will Protect Employees' Use of Marijuana Outside Work
A new state law will take effect in 2024 prohibiting California employers from penalizing workers for using marijuana during their off-work hours.

President Pardons Americans Convicted of Marijuana Possession
President Joe Biden on Oct. 6 pardoned all people convicted of simple marijuana possession under federal law. Employers may want to examine how this could impact their hiring and drug-testing policies.

HR Q&A: How Does California Law Regarding Medical Marijuana Use Affect Hiring?While California has legalized the use of both medical and recreational marijuana, employers may still refuse to hire an applicant or choose to terminate an employee who tests positive for the drug.

SHRM Resource Hub Page: Marijuana and the Workplace
The legal landscape surrounding marijuana is dynamic and changing quickly. Employers can use these resources to keep up with the newest developments

SHRM How-to Guide: How to Document Reasonable Suspicion
What should employers do if they suspect an employee is under the influence of drugs or alcohol at work? This guide presents the steps management should take under a drug and alcohol testing policy.

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