Four questions employers need to ask themselves about their Marijuana and drug testing policies

Posted November 24, 2022 on The Business Journals

Voters in two more states approved the legalization of recreational marijuana on Nov. 8, further complicating an evolving landscape for employers.

But even before Missouri and Maryland joined 19 others and the District of Columbia on the list of states with recreational marijuana, experts say many employers were already rethinking their stance on marijuana due to changing laws, evolving sentiments and the tight hiring market.

Greta Bauer Reyes, an associate at Stinson LLP, said many employers are altering their testing policies as the legal landscape shifts.

With more states legalizing marijuana use for medicinal or recreational use, Reyes said some employers find it arbitrary to exclude employees from employment based on a positive drug test for cannabis.

“Some employers have begun relaxing their drug-testing policies to account for the current reality that a positive cannabis test may not be indicative of illegal drug use or other employment-disqualifying actions,” Reyes said.

Here’s a look at some questions businesses should ask themselves about their marijuana policies in light of the evolving landscape.

Should our company’s drug-testing policy change?

Experts say there are several factors that will play into that question — and the increasing number of states that have legalized recreational marijuana is only adding to the confusion.

Some states, New York and New Jersey for example, have essentially outlawed testing employees for cannabis use in many cases. That’s leading some businesses to give up their traditional drug-testing programs.

"Some states believe a worker’s employment shouldn’t be at risk if they used cannabis over the weekend but will invariably test positive days or even weeks later," said Mark Neuberger, of counsel with Foley & Lardner LLP's cannabis industry team. "The law on this issue varies widely among the states and is rapidly changing, so many employers are just giving up on cannabis testing."

What should businesses with locations in multiple states do?

Reyes said a one-size-fits-all approach won’t work when employers operate in different jurisdictions.

Aside from the growing number of states that have legalized marijuana, Reyes said state laws sometimes include affirmative protections for employees.

For example, Nevada state law prohibits employers from refusing to hire an employee because they tested positive for cannabis on a pre-employment drug test. Other states still allow those employees to be excluded.

Joseph Jeziorkowski, partner at Valiant Law, said legislation taking effect in California in 2024 will protect workers from discrimination based on cannabis use outside work or a failed drug test, but there are exceptions for those in building and construction, as well as employees requiring a federal background investigation or clearance.

The variance between states and municipalities means employers with large footprints will need to navigate a complex patchwork of quickly evolving regulations.

The impact? Employers can no longer have a generalized drug-testing policy and need to work with their attorneys to review and adapt their policies as laws change in the jurisdictions where they operate.

How does medicinal marijuana factor in to how businesses approach the issue?

Reyes said medical marijuana plays a significant role in employer policies — especially in states with built-in protections for employees who are registered users of medical marijuana.

For example, Minnesota has a law prohibiting employers from discriminating against employees or applicants due to their medical cannabis use.

Reyes said the same law prohibits employers from taking an adverse action against an employee who is a qualified patient for having a positive test for cannabis, unless the employee actually used, possessed, or is impaired by cannabis on the premises or during work hours.

“Employers must be conscious of these built-in protections in each jurisdiction in which they operate, so that they do not inadvertently violate the law when applying their policies and procedures on employee drug testing,” she said.

Kathryn Russo, a principal at Jackson Lewis PC, said medical marijuana users are presumably classified as "disabled" for purposes of state anti-discrimination laws, she said, so employers must be careful that their employment actions do not constitute disability discrimination.

Russo said employers in states where recreational use of marijuana is legal are starting to view it similarly to alcohol — an approach she said employers will need to take if marijuana is eventually legalized at the federal level.

How is the labor climate affecting marijuana policies?

Reyes said the hiring market could be a driving factor behind the relaxation of drug-testing policies — although some industries or specific jobs have regulatory or legal rules that require a negative drug test.

Outside of those regulated industries, attorneys say labor challenges are forcing the hand of many employers.

“The tight labor market provides a reason for employers to hire applicants who tested positive for cannabis, when the employer may not have made that hire in the past,” she said.

Reyes said the combination of the labor shortage and legalization efforts have given employers an objectively reasonable basis for determining that an employee or applicant’s use of cannabis does not necessarily indicate whether they will be a successful employee.

Region: North America