Utah County PB&L Employment Law Seminar - August 28, 2019

1. Utah County Employment Law Seminar
Wednesday, August 28, 2019
PA R S O N S B E H L E . C O MN AT I O N A L E X P E R T I S E . R E G I O N A L L AW F I R M .
Weed and the Workplace:
Navigating New Marijuana Laws
Mark A. Wagner
801.536.6776 | mwagner@parsonsbehle.com

2. OVERVIEW

3. 3
Agenda
History of Marijuana Laws
o Federal Law
o State Laws
Workplace Marijuana Issues
o Applicant Screening and Employee Testing
o Hiring and Termination Decisions
o Disability Accommodation
Recommendations for Employers

4. 4
Disclaimer
 Licensed to practice law in only Utah (and federal).
Comments about other states’ laws is for information only.
Consult with an employment attorney licensed in the
specific state of concern.
 Information is current as of August 2019.

5. History of Marijuana Laws

6. 6
Federal Law – Statutory Treatment
 1937 Marihuana Tax Act
o Held unconstitutional in 1969 by Leary v. United States
 1970 Federal Controlled Substances Act (CSA)
o Marijuana – Schedule I Drug
• High potential for abuse
• No currently accepted medical use in treatments in U.S.
• Lack of accepted safety for the use of the drug under medical supervision

7. 7
Federal Law – Enforcement
 Federal government could crack down but has not.
o Gonzales v. Raich (2005) – CSA may validly be applied to individuals’
cultivation, distribution, and possession for personal, medical use.
o Ogden (2009), Cole (2013) Memos gave some protections
(although the Cole Memo was rescinded in 2018 by Jeff Sessions).
o Rohrabacher-Blumenauer Amendment (2014) gave some more.
o These preclude only law enforcement action; they don’t legalize.

8. 8
(cont.)
 Weakening of Federal Prohibition
o Epidolex (CBD-based Drug) Moved to Schedule V
o 2018 Farm Bill
• Removes cannabis plants with less than 0.3% THC from the CSA
• Lets states permit the cultivation of industrial hemp
• Provides for interstate transport, even through states prohibiting production
 However CSA Is Still the Law

9. 9
Federal Illegality Consequences
 Banking
o Money Laundering Provisions
o FinCEN Memo tried to loosen restrictions, but to no avail.
 Tax
o 280E -- No Deductions Except Cost of Goods Sold
 Access to Lawyers
o MRPC Rule 1.2(d) “A lawyer shall not counsel a client to engage,
or assist a client, in conduct that the lawyer knows is criminal or
fraudulent”
 Loss of benefits/privileges.
o Parental rights, government benefits, employment

10. 10
State Cannabis Laws

11. 11
Medical Marijuana Laws
 Marijuana Use for Medical Purposes
o Varying qualifying medical conditions
• See Utah Code § 26-61a-104(2) - 16 conditions listed
o Varying registration and verification requirements
o Varying oversight
o Varying job protection
• Utah – medical care or government employment

12. 12
Recent Developments - National
 NYC ban on employer preemployment drug testing, April 2019.
 Only Half of CO Employers Will Fire for a Single Pot Test,
Denver Post, March 2019.
 Quest Diagnostics Study, April 11, 2019:
o Workforce drug testing positivity climbs to highest rate since 2004.
o 2.8% of workers test positive for marijuana nationwide, up from
2.4% in 2014.

13. 13
(cont.)
 Pew Research Study Sept. 2018
o Trend continues to rise for those
believing use should be legalized.
o All numbers are up from similar
study in 2017, only Gen X and
Boomers saw drops in
percentages.

14. Workplace Marijuana Issues

15. 15
Issues
 OSHA/DOT
 Zero-Tolerance Policies
o Federal Contractors and Grant Recipients
o Non-Federally Regulated Businesses
• Safety Sensitive Positions
 Antidiscrimination Laws – Federal, State, and Local
 Workplace Enforcement Concerns
o Public Policy
o Outside-of-Work Activities

16. 16
(cont.)
o At-Will v. Just Cause
o Workers’ Compensation
o Unemployment Benefits
o Drug Testing
o Pre- v. Post-Employment
o Random
o Suspicion of Impairment
o Urinalysis
o Blood
o Saliva
o Hair

17. 17
OSHA/DOT
 OSHA
o Off-duty use is not a violation of the OSHA general duty clause.
o Employers can still expect employees to work to the required standards.
• Marijuana laws do not diminish need for a safe, productive workplace.
o Post-incident drug testing policies are not prohibited–must be consistent.
 DOT
o DOT-regulated drug testing is not changed by state laws permitting medical
marijuana.
o Medical Review Officers will still treat as positive test.

18. 18
Zero-Tolerance Policies
 Drug Free Workplace Act
o Required for many federal contractors and all federal grant recipients.
• Develop and publish a written policy and ensure that employees read and
consent to it as condition to employment (should clearly prohibit the
manufacture, use, and distribution of controlled substances in the workplace
and spell out the consequences of violating the policy).
• Establish a drug-free awareness program to educate employees of the
dangers of drug abuse, the workplace policy, and any available drug counseling,
rehabilitation programs, and employee assistance programs.
• Require notifications from employees within 5 days of a criminal drug conviction.
• Notify the federal contracting agency within 10 days of any covered violation.
• Take action against an employee convicted of a workplace drug violation; e.g.,
impose a penalty or require participation in rehabilitation or counseling program.
• Make an ongoing good faith effort to maintain a drug-free workplace.
o NOTE: The Act does not require mandatory drug tests.

19. 19
(cont.)
 Non-Covered Employers
o Can still enforce zero-tolerance policies for safety-sensitive positions.
• Generally where one is responsible for safety of themselves or others
– Driving or use of machinery
• CDL
– Omnibus Transportation Employee Safety Act requires drug testing.
o Challenges rise in application of many laws and changing legal
landscape

20. 20
Discrimination/Retaliation Laws
 Do not require employers to tolerate on-duty (or in-workplace) use.
 Do not prohibit workplace drug testing (except for alcohol).
 Adverse Employment Actions
o Challenges
• Accommodation
• Hiring, firing, and discipline
• Drug testing
• Employees’ theories on the protections of the law
• Off-duty conduct

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Challenges – Accommodations
 ADA
o The ADA does not require accommodation of illegal drug use, and
marijuana is still illegal under the CSA.
 State Statutes – it depends on the wording of the specific statute.
o Statute specifically requires accommodation of medical marijuana use:
• NY: a certified patient “shall be deemed to be having a ‘disability’ under the
state’s human rights law.”
o Statute has specific provisions on nondiscrimination-in-employment.
• AZ, AK, CN, DE, IL, MA, ME, MN, ND, NM, NV, PA, RI, WV

22. 22
(cont.)
o Specific NO-accommodation provisions.
• AL, FL, OH, NJ, MT: employers NOT required to accommodate medical
marijuana. (But see below how the NJ statute is handled by a court.)
o Statute refers to obligations it does NOT impose on an employer, but
does not clearly state no obligation to accommodate.
• HI, LA, MD, MI, NH, VT
o Statue is silent as to affect on employment.
• CA, CO, DC, MO, NM, OR, UT, WA

23. 23
(cont.)
• CA (2008):
• Ross v. RagingWire Telecommunications, Inc.
• Plaintiff had back spasms prom previous injury and physician recommendation. Failed pre-
employment drug test. had provided copy of recommendation.
• Court held law exempted from criminal liability. No claims for discrimination under disability
discrimination statute or public policy violation, and no requirement to accommodate
employee’s use of medical marijuana.
• Court found no implicit requirement to accommodate, no right to use free of inconvenience.
• MT (2009):
• Johnson v. Columbia Falls Aluminum Company
• Plaintiff sustained injuries on the job, under physician supervision, failed fitness-for-duty test.
• Court held employer was not required to accommodate employee’s use of medical marijuana
under the federal ADA or the Montana Human Rights Act.
• CBA controlled; state rights not considered.

24. 24
(cont.)
• OR (2010):
• Emerald Steel Fabricators, Inc. v. Bureau of Labor & Industries.
• Plaintiff suffered from severe anxiety and stomach cramps; had registry ID card; condition for
permanent employment, presented ID card (no failed test).
• Court held employer not required to accommodate medical marijuana user, applicant under
the Oregon Medical Marijuana Act. Federal Controlled Substances Act preempted Oregon
statute authorizing use of medical marijuana.
• WA (2011):
• Roe v. Teletech Customer Care Mgmt. LLC
• Plaintiff suffered from debilitating migraines, had doctor’s authorization, and notified
employer prior to preemployment drug test.
• Court held no public policy right to require employers to accommodate marijuana use under
the Medical Use of Marijuana Act (even outside workplace).

25. 25
(cont.)
• MA (2017):
• Barbuto v. Advantage Sales & Marketing, LLC.
• Plaintiff with Crohn’s disease, characterized as debilitating medical condition under the
medical marijuana act, and other allegations showing she had physical impairment
substantially limiting a major life activity, was a handicapped person under state statute.
• Plaintiff sought accommodation of continued use of medical marijuana, but employer argued
that it was a federal crime; thus, unreasonable. Employer did not engage in accommodation
interactive process.
• Court found in employee’s favor. Law states patients shall not be denied “any right or
privilege” on basis of authorized use.

26. 26
(cont.)
• NJ (2019)
• Wild v Carriage Funeral Holdings, Inc
• Plaintiff (funeral director) was authorized to use medical marijuana to treat chronic pain as
part of his cancer treatment. Plaintiff was required to submit to a post-accident (driving) drug
test. He informed employer that he would test positive because of his authorized use. Was
required to test anyway, and was terminated after his test (presumably) came back positive.
• New Jersey Compassionate Use Act provides: “Nothing in this act shall be construed to
require . . . an employer to accommodate the medical use of marijuana in any workplace.”
• Court held this was irrelevant to whether plaintiff had a cause of action under the existing
New Jersey Law Against Discrimination (LAD). “In short, like the first law of
thermodynamics, that provision – beyond its own limited criminal and regulatory context –
neither creates nor destroys rights and obligations.”
• Under this court’s reasoning, no medical marijuana statute that grants employer protections
with the language “nothing in this act [prohibits] [restricts] [requires] . . .” would shield an
employer from obligations that arguably come from another statute – like a state
nondiscrimination statute.

27. 27
Challenges – Adverse Employment Actions
 Many courts have held that employers may refuse to hire,
terminate, or discipline an employee for marijuana use,
many specifically based on preemption of federal law.
 But Connecticut has found that a specific state statute
would not be preempted by federal law.
 No right to employment
o Montana Cannabis Industry Ass’n v. State (2012) – updated MMJ
law prohibiting right to sell medical marijuana – previous providers
under previous law had no fundamental right to pursue
employment free of state regulation.

28. 28
(cont.)
 Casias v. Wal-Mart Stores, Inc. (2011)
 Michigan federal district court, Western Division
o No claim for wrongful discharge for employee who tested positive
for validly obtained medical marijuana. Michigan’s medical
marijuana law does not regulate private employment. Rather it
gives potential affirmative defense to prosecution.
o Affirmed by 6th Circuit 2012

29. 29
(cont.)
 Coats v. Dish Network, LLC (2015)
 Supreme Court of Colorado
o No wrongful termination claim when wheelchair bound quadriplegic
was fired for medical use of marijuana properly licensed under
Colorado law. Court found in split decision that medical marijuana
use, which is unlawful under federal law, is not “lawful” activity
under Colorado law.

30. 30
(cont.)
 Noffsinger v. SSC Niantic (2018)
 Connecticut Federal district court
o CT statute explicitly prohibits discrimination against patients by
schools, landlords, and employers.
o Fed. Dist. Court finds this statute is not preempted by federal law
and grants summary judgment on her discrimination claim

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Challenges – Drug Testing
 District of Columbia
o Pre-Employment Marijuana Testing Act of 2015
• Prohibited from testing prior to offer of employment
 Maine
o Department of Labor
• No pre-employment marijuana drug testing
 Under Influence/Impaired at work
o No objective testing standard of impairment (AZ, AK, DE)
o Drug test alone is not sufficient to establish impairment (ME)

32. 32
Challenges – Off Duty Conduct
 Many states have Legal Off Duty Conduct Laws
o CA, CO, NV, NY, ME, TN
o Application will come down to specific language in statute.
• i.e., “legal conduct” in Colorado law (Coats)
o Maine
• A school, employer, or landlord may not refuse to enroll, employ, or lease to
or otherwise penalize a person 21 years-of-age or older solely for that
person’s consuming marijuana outside of the school’s, employer’s, or
landlord’s property.

33. 33
Additional Issues
 Workers’ Compensation
o Medical marijuana – reimbursable prescription/treatment in some
states
• Yes - CT, ME, NM; Limited – MI, OH, OK, VT; No – CO, MT, OR
o Accidents caused by use – AK, NM
 Unemployment Benefits
o Discharged for lawful medical marijuana use
o Discharged for illegal use
• On-Duty: No
• Off-Duty: Maybe

34. 34
(cont.)
 Vialpando v. Ben’s Automotive Services (2014)
 New Mexico Court of Appeals
 Requirement under Workers’ Compensation Act to provide
reasonable and necessary health care services from a
health care provider includes doctor’s medical certification
for use of medical marijuana under the Compassionate Use
Act.

35. 35
(cont.)
 Braska v. Challenge Manufacturing Company (2014)
 Michigan Court of Appeals
o Michigan Medical Marijuana Act (MMMA) prohibits penalties for
legal use of medical marijuana. Therefore, workers fired for testing
positive for marijuana could not be barred from collecting
unemployment benefits where use was legal under the MMMA.

36. 36
(cont.)
 Beinor v. Industrial Claim Appeals (2011)
 Colorado Court of Appeals
o Employee terminated after testing positive for marijuana in
violation of zero-tolerance policy could be denied unemployment
insurance benefits.
o Use was for authorized medical use outside work hours.
o Statute disqualifies individuals for unemployment benefits after use
that was not medically prescribed – here the program only requires
certification.
o Law created exception to criminal prosecution, not a grant of
unlimited constitutional rights to use in any place or in any manner.

37. 37
(cont.)
 Eastham v. Housing Authority of Jefferson County (2014)
 Illinois Appellate Court
o Plaintiff took a random drug test at work a few weeks after returning from
vacation and admitted to his employer that he has smoked marijuana
during his time off. Based on his admission, plaintiff was terminated by
his employer in accordance with policy of a having a drug-free and
alcohol-free workplace.
o Applied for unemployment insurance benefits. His application was
denied on the basis that his choice to use drugs constituted willful
misconduct. Reversed on appeal, finding plaintiff was entitled to
unemployment insurance benefits because the policy only prohibited use
of controlled substances while in the course of employment.

38. Recommendations for Employers

39. 39
Evolving Law - Looking Ahead
 Greater scrutiny of drug testing of applicants and employees
o THC in the blood and impairment don’t match up very closely.
o Employment actions (like impaired driving prosecutions) should be
based on impairment and testing should be evidence of that.
 States are more clearly specifying the scope of employer
protections.
o Where underlying conduct is legal under state law, it should be
clear that employers must permit employee use up to their
obligations under federal law.
 Litigation will be over what federal law requires.

40. 40
Recommendations
 Consider business needs/culture – drivers, operators, safety.
 Keep up to date on new developments in your state (and
neighboring states if multi-state employer).
 Keep drug and alcohol policy updated.
o Be specific; e.g., clarify federal and state law, not just “legally prescribed.”
o Define impairment based on observable characteristics.
 Know handbook and policies.
o Apply uniformly
o Publicize your policy and train supervisors
 Consider accommodation process.

41. 41
(cont.)
 Consider drug testing process.
 Consider whether drug testing for other drugs (but not
reading for marijuana) in states that have legalized
marijuana is an appropriate middle ground.

42. 42
Thank You
 Mark A. Wagner
801.536.6776
mwagner@parsonsbehle.com