Cannabis Use in the Workplace: A Sensible Legal Approach

September 25, 2021

By Rebecca Byars, MSHR and Timothy Byars, President, Radicle Health

Which states have the most progressive laws regarding legal cannabis use in the workplace?

You might guess California, Colorado, and Oregon. After all, California has had a legal medical cannabis program since 1996 and a legal adult-use program since 2018. Oregon and Colorado both have mature, legal adult-use programs, as well.

None of these states, however, have passed laws protecting employment for those who engage in the legal use of medical cannabis. Workers who are lawfully engaging in a legal activity outside of the workplace—who might be using cannabis at the instruction of their doctor—can be terminated from their employment for using cannabis.

In this article, we dispel some popular misconceptions about cannabis and federal employment law, discuss the federal requirements that impact workplace policies of organizations that receive Medicare subsidies, and examine the legal trends that can prevent employers from discriminating against medical cannabis users.

Current Legislation

Since Congress passed the Controlled Substances Act in 1970, cannabis has been listed as a Schedule I drug. Drugs in this most restrictive category (which includes heroin, LSD, and ecstasy) are considered to have a high potential for abuse and no currently accepted medical use. It should be noted that the federal government’s own U.S. Department of Health and Human Services has a patent—number 6,630,507—on the medical efficacy of cannabis to protect the brain from damage and degeneration. And, the National Academies of Sciences, Engineering, and Medicine (funded largely by the U.S. federal government) reported that conclusive evidence exists that cannabis can treat chronic pain, nausea and vomiting, and spasticity from multiple sclerosis.

Despite the federal government’s bizarrely conflicted position on cannabis scheduling, all but three states in the U.S. have now accepted that there are medical uses for cannabis and they have instituted their state laws permitting its use.

Cannabis and Employer Policies: A Sensible Approach


However, because cannabis remains illegal at the federal level, there are no federal workplace protections for patients who rely on cannabis medications for their health. Many patients have lost their jobs, or have been disqualified from or discouraged from pursuing employment opportunities due to overly broad and unfair workplace policies prohibiting cannabis use.

woIn 1996, California became the first state in the nation to enact the legal use of medical cannabis when California residents voted to pass Proposition 215, the Compassionate Use Act. This law specifically permitted residents to use cannabis for medical purposes. Unfortunately, no language in Prop 215 required employers to accommodate cannabis patients and no provisions to protect a patient’s right to employment.

On January 1, 2018, California enacted Proposition 64, which permits the lawful use of cannabis for anyone over the age of 21 (Prop 64 does not require a medical necessity).  Consequently, all California adults can now legally use cannabis. But just as Prop 215 failed to address workplace protections, Prop 64 failed here, as well. Prop 64 explicitly states that the law does not require an employer to permit or accommodate cannabis use in the workplace.

Anti-Cannabis Policies: Workplace Impact

The confusion and collision of laws permitting legal adult-use without any workplace protections for employees have resulted in serious consequences for employers and employees. For example, a recent survey of 500 California residents conducted by California NORML (National Organization for the Reform of Marijuana Law) revealed that:

  • 25% had been denied employment because of their cannabis use
  • 14% had their employment terminated because of cannabis use
  • 50% are fearful of missing job opportunities because they use cannabis
  • 40% have stopped using cannabis because they are subject to employer drug testing
  • 25% have increased their use of opioids or other medications because they are subject to employer drug testing

The conflict between state and federal law has created an employment environment where employers can refuse employment to and terminate the employment of state residents who are participating in a lawful activity. The consequences are predictable: the current employment environment prevents cannabis users from access to positions for which they would be otherwise eligible and qualified. And, it encourages cannabis patients to switch to opioids and other addictive medications with severe adverse effects.

Moreover, the environment is beginning to expose employers to claims of workplace discrimination. Until recently, employers had the autonomy to enforce broadly written, zero-tolerance policies that prohibited the use of cannabis, and employers could faithfully rely on federal laws to support and defend these policies. However, as legal cannabis access has expanded throughout the country, employees and job applicants who have been negatively impacted are starting to challenge these policies. Consequently, there are a growing number of state courts that have ruled that workplace policies prohibiting the lawful use of medical cannabis is discriminatory.   

There are now 15 states (and the District of Columbia) that have enacted laws protecting an employee’s right to use medical cannabis:

  • Arizona
  • Arkansas
  • Connecticut
  • Delaware
  • District of Columbia (pending 30-day congressional review)
  • Illinois
  • Maine
  • Massachusetts
  • Minnesota
  • Nevada
  • New Jersey
  • New Mexico
  • New York
  • Oklahoma
  • Pennsylvania
  • Rhode Island
  • West Virginia

In 2019 alone, eight states (those shown in bold) have enacted or strengthened these laws. Employees are fighting back and the courts are agreeing with them.  We expect this trend to continue.

In addition to the mounting number of lawsuits and new state laws, other trends and considerations are favoring cannabis patient rights. With expanding access to cannabis education combined with the lowest unemployment rates in the U.S. since the 1960s,  employers with policies prohibiting any cannabis use are not able to compete with companies with more progressive and relaxed pre-employment drug test screening policies.

Of course, some employers insist that these drug-testing policies are required because the employer receives federal contracts, grants, or subsidized payments from the Centers for Medicare & Medicaid Services (Medicare or Medicaid). Many employers will defend zero-tolerance cannabis policies by citing the potential loss of federal funding, licensure, accreditation, and subsidies.

However, zero-tolerance cannabis policies typically exceed the intent of federal law.

Federal Drug-Free Workplace Laws

Human resource officers and company executives often cite federal contracts or federal grants as reasons to deny employment to anyone who tests positive for cannabis.

However, there are no laws that require organizations that receive federal funding to deny employment to cannabis patients. Rather, there are laws that direct those organizations to establish policies and procedures regarding cannabis use policies in the workplace.

Two federal laws address cannabis in the workplace:

  • The Drug-Free Workplace Act of 1988 (DFWA), which applies to organizations that hold federal contracts over $100,000 or who receive federal grants of any size.
  • The Omnibus Transportation Employee Testing Act of 1991, which applies to safety-sensitive transportation employees: pilots, school bus drivers, truck drivers, train engineers, subway operators, aircraft maintenance personnel, transit fire-armed security personnel, ship captains, and pipeline emergency response personnel, among others.

Both of these laws apply only to narrowly defined organizations and, by definition, most employers are not subject to statutes defined in these laws. Moreover, even those organizations that are subject to these laws are not required to enact blanket policies prohibiting employment of candidates or employees who test positive for cannabis. 

Drug-Free Workplace Act of 1988 (DFWA)

Consider the DFWA (this is the law to which most employers refer to justify their drug-free workplace policies).

The DFWA requires the following:

  • Covered employers must develop a drug-free workplace policy that prohibits the unlawful manufacturing, distribution, dispensation, possession, or use of a controlled substance in the workplace and specifies the actions that will be taken against employees for violations of the prohibition.
  • Covered employers must establish a drug-free awareness program to inform employees about the dangers of drug abuse in the workplace, a review of the drug-free workplace policy, available counseling, rehabilitation, employee assistance programs, and penalties for violating the drug-free workplace policy.
  • Covered employers must notify their employees of the drug-free policy in writing and require their confirmation that they will abide by the terms of the policy and that they will also notify their employer of any criminal drug conviction for a violation occurring in the workplace no later than five days after the conviction.
  • If an employee is convicted of criminal drug use violation in the workplace, the covered employer must:
    • Notify the contracting federal agency within ten days after receiving such notice of the conviction.
    • Impose a sanction on, or require the employee to undergo a drug-abuse assistance or a rehabilitation program.
    • Make a good faith effort to continue promoting and enforcing the drug-free workplace policy.

The DFWA does not require:

  • Employers to conduct pre-employment, reasonable suspicion, post-accident, or random drug testing.
  • Employers to monitor or punish employees for activities performed outside of the workplace.
  • Employers to terminate the employment of employees who violate DFWA requirements (employers are required only to address the situation, per the employer policy. For example, a proper response can include a reassignment of duties to remove the employee from projects that are directly impacted by the federal contract or grant).
  • The termination of a contract or grant as a result of an employee’s violation of a drug-free workplace policy. 

Moreover, the Office of Federal Contracts and Compliance Programs (OFCCP) has determined that Medicare and Medicaid are not considered government contracts, thereby determining that organizations who receive these third-party payments are not subject to DFWA requirements.

Omnibus Transportation Employee Testing Act (1991)

The second federal law that governs workplace drug-free policies is the Omnibus Transportation Employee Testing Act of 1991, which applies primarily to individuals working in the transportation industry and to those who work for agencies under the purview of the Department of Transportation (DOT), including: 

  • Federal Motor Carrier Safety Administration (FMCSA)
  • Federal Railroad Administration (FRA)
  • Federal Aviation Administration (FAA)
  • Federal Transit Administration (FTA)
  • Pipeline and Hazardous Materials Safety Administration (PHMSA)
  • United States Coast Guard (USCG)

The Omnibus Transportation Employee Testing Act requires the following:

  • Pre-employment, reasonable suspicion, post-accident, and random testing of employees responsible for safety-sensitive functions (as determined by the administrator) for use of alcohol or a controlled substance in violation of laws or Federal regulation. Each industry has its definition of duties deemed safety-sensitive, but the term generally describes a position in which an alcohol or drug impairment constitutes a direct threat to public safety. Generally, employees performing operations in a commercial capacity are subject to testing.
  • Comprehensive policies that describe how and when tests are conducted and by whom. Also, these policies must be made accessible to all parties impacted by the policy.

The Omnibus Transportation Employee Testing Act does not require:

  • Ineligibility for employment if a candidate fails a pre-employment drug test.  The law applies only to the safety-sensitive functions within the organization.
  • Termination of employment for testing positive. The DOT requires that employees who test positive for restricted substances or refuse a test be immediately removed from safety-sensitive functions.
  • DOT requires that these employees be given a list of qualified substance abuse programs. The employer can pay for the service or require the employee to pay for the service. The DOT also requires that any employee who requests to return to a safety-sensitive position must complete the return-to-duty process as specified by their employer and complete a substance abuse program.

In summary, the policies required by the DFWA and by the Omnibus Transportation Employee Testing Act apply to narrowly-defined employers, and that subset of organizations are not required to create or enforce policies preventing employment for individuals who test positive for cannabis. Rather, these employers are directed to enact policies and procedures that address cannabis use in the workplace.

Impairment Testing vs. Drug Testing

Drug-free workplace policies are intended to ensure workplace safety and performance quality and employers should craft policies that specifically address those issues. While most companies have opted to use urine testing (or drug testing) to ensure workplace safety, there exists a much better—and logically sound—tool: impairment testing. 

Impairment testing determines whether employees put themselves or others at risk by directly measuring their current fitness for a task. Drug testing, however, determines whether an employee has used—at some point in the past—specific substances that can potentially cause impairment.

Impairment testing is a better option than drug testing because of impairment testing:

  • Measures an employee’s condition at the workplace at the time that the employee is required to perform work.
    Drug testing measures only whether an employee used some substance in the past, does not measure impairment, and has no relevance to the employee’s current physical state. For example, testing positive for cannabis is not an indicator of impairment in the workspace. Individuals can consume cannabis and fail a drug test weeks later.
  • Measures impairment from any substance or situation.
    For example, impairment testing can measure impairment from illicit substances, legal substances, from hangovers, impairment from illness or chronic pain, and so forth. In one study, fatigue was listed by employers as the most common cause of workplace impairment.
  • It is less invasive than drug testing and better protects employee privacy.
    Impairment testing is not physically intrusive and does not disclose an employee’s medically sensitive information.

Impairment testing tools vary, but they all measure employee performance based on the accumulated data recorded and stored for every employee. These software programs typically use touchscreens or video game technology, they can be accessed from any device, and employees can complete these tests in fewer than two minutes.

During initial testing periods, the software records and saves employee responses measures the speed and accuracy of these responses and creates a baseline performance score. Each subsequent test measures the employee’s score against the baseline average. If the current score is outside of a normal range, the software alerts a designated contact.

Unfortunately, there are very few companies that use impairment testing and fewer still that create products that measure impairment. However, in one study completed by the National Workrights Institute, researchers collected information about impairment testing from 14 different employers. That data included the following results: 

  • 100% of the employers considered impairment testing successful
  • 82% of employers stated that it improved safety
  • 90% of employees approved of impairment testing
  • 87% of employers stated that impairment testing was a better tool than drug testing.


Neither employers nor employees are well served by broadly written drug-free workplace policies. These policies can prevent employers from finding the best-qualified candidates for available positions and can expose employers to discriminatory litigation.

Federal drug-free laws were written specifically to create safe and effective workplaces, and we should all strive to enact procedures to ensure that these standards are upheld. Impairment in the workplace is a serious issue that requires policies that actually address impairment.

Many legal substances can produce impairment—alcohol, prescription medications, over-the-counter medications, and cannabis. Banning the use of one of these substances—especially the most benign of these substances—is simply illogical.

Pain, chronic discomfort, and lack of sleep can also cause impairment. Preventing employees from treating these issues safely and effectively outside of the workspace using a legal substance is counter-intuitive and can compromise the overall health of the workforce, while potentially discriminating against employees who need to treat with cannabis medications.

Employers can provide a safer work environment, hire and retain the most qualified staff, and minimize their exposure to discrimination claims if they start enacting sensible workplace policies regarding cannabis use.

Share HR West 2018 Details! > HR in the most innovative place on earth! #HRWest18
Posted in Workplace Law and tagged , .

Leave a Reply