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Risk in Context

Four Ways Employers Can Manage Marijuana Legalization Risks

Posted by Kelly Thoerig January 04, 2017

As marijuana has been legalized or decriminalized for recreational or medical purposes across 44 US states, its detection in workplace drug testing has increased, raising significant questions for employers. Chief among them: How can we balance our employees’ legal rights with the goal of maintaining a drug-free workplace?

Challenges for Employers

Courts have generally sided with employers that discipline employees for workplace drug use. But with marijuana becoming increasingly legal at the state level, employers could face challenges. For example:

  • Employers generally cannot discriminate in hiring and other terms of employment based on an employee’s status as a medical-marijuana patient. In fact, four states — Arizona, Delaware, Minnesota, and New York — expressly protect medical marijuana users by requiring employers to prove that an employee was impaired while on the job if usage is cited as part of the reason for termination.
  • Marijuana can stay in a person’s system for months, so employees who use marijuana legally could test positive for the drug even if they were not impaired at work. Terminating an employee solely for a positive drug test — without evidence of actual impairment at work — could give rise to a discrimination claim.

Managing Risk

Employers seeking to keep drugs out of their workplaces should consider these four steps:

  1. Review employee handbooks and personnel policies with legal counsel. These policies should clearly communicate expectations regarding medical marijuana use to employees and others and set forth the circumstances under which uniform, nondiscriminatory drug testing may be performed.
  2. Ensure that human resources personnel and others involved in employment decisions understand federal and state marijuana laws. For example, observing and documenting any objective factors that support a good-faith belief that an employee was impaired at work before terminating an employee for violating drug-free workplace policies may be critical.
  3. Avoid asking job applicants and employees about their prescription drug use, unless it’s job-related or legally necessary. These questions could elicit information about disabilities and potentially violate the Americans with Disabilities Act or other laws.
  4. Review insurance coverage. Employment practices liability insurance could provide coverage for wrongful termination, failure to hire, discrimination, invasion of privacy, and other claims related to a job applicant’s or employee’s use of medical or recreational marijuana.

Taking these steps can help you enforce anti-drug policies while respecting employees’ rights, even as the trend toward marijuana legalization continues.

For more on this topic, read Insurance and Risk Management Implications of Marijuana Legalization Following 2016 Elections.

Kelly Thoerig

Managing Director, Employment Practices Liability Coverage Leader