Reed Smith Article: New marijuana laws and court cases continue to provide inconsistent guidance for employers: a summary of recent developments in Illinois, Nevada, New Jersey and Michigan

Reed Smith Article: New marijuana laws and court cases continue to provide inconsistent guidance for employers: a summary of recent developments in Illinois, Nevada, New Jersey and Michigan

Over the past few years, 31 states have legalized some form of medical or recreational marijuana use and this wave of legalization continues to grow. Since there has been no consistent approach taken related to the intersection of legalized use and employment, employers must stay vigilant about recent developments in each location in which they operate.

To assist in navigating these waters, below is a summary of the recent enactments in Illinois and Nevada, as well as an update as to newly published judicial interpretations of the medical marijuana laws in New Jersey and Michigan.

Illinois

On June 4, 2019, Illinois became the 11th state in the nation to legalize the recreational use of marijuana when it passed the Cannabis Regulation and Tax Act (HB 1438). While the Act, which goes into effect on January 1, 2020, decriminalizes marijuana use, it maintains an employer’s right to prohibit such use in several respects. Specifically, the Act provides the following:

  • Explicit preservation of an employer’s rights to maintain a drug-free work place, conduct drug tests, and discipline or fire employees for failure to abide by employment or workplace policies.
  • No requirement for employers to ignore their obligations under federal law (i.e. Department of Transportation regulations), nor take any action that would jeopardize government contracts or funding.
  • No private cause of action against employers who discipline (including termination) an employee based upon a good faith belief the employee was in violation of an employment or workplace policy.

While the law gives employers great latitude to prohibit marijuana use by employees, and permits reasonable, non-discriminatory drug testing to accomplish that goal, it is less clear whether employers have the power to prohibit employees from using marijuana outside the workplace when such use does not interfere with employee job performance. If an employer intends to prohibit non-workplace cannabis use, then that should be clearly spelled out in an employment policy. Conversely, if an employer does not intend to explicitly prohibit that use, then it may be unreasonable to discipline or fire an employee based solely on the results of a failed drug test. Either way, in anticipation of the January 1 deadline, employers in Illinois should carefully consider their marijuana policies and make any expectations clear to their employees.

Nevada

In Nevada, the legislature recently passed the first statewide law preventing employers from rejecting potential job applicants based on a failed drug test for marijuana (AB 132). Although employers remain free to administer drug tests, in light of the prohibitions in this Act, employers should consider whether it is worthwhile to test for marijuana given the limitations on adverse actions based on a failed test. The Nevada law, which exempts most jobs in public safety, follows a similar law passed in New York City this April. These laws create unprecedented protections for job applicants based on marijuana use, unique even among the 31 states that have so far legalized some form of medical or recreational cannabis. The Nevada law becomes effective on January 1, 2020.

New Jersey

In Wild v. Carriage Funeral Holdings, Inc., the Superior Court of New Jersey Appellate Division recently ruled that the disability discrimination protections in the New Jersey Law Against Discrimination (NJLAD) applied to a medical marijuana user. Although the New Jersey Compassionate Use Medical Marijuana Act (CUMMA) explicitly states that “nothing” in the law “requires” an employer to accommodate medical marijuana use, the court reasoned that CUMMA “neither creates nor destroys rights and obligations.” Under its reasoning, employers remain bound by the requirements of the NJLAD even when an employee has violated their drug policies. The Appellate Division, therefore, reinstated the complaint that the Superior Court initially dismissed.

The Wild court made no mention of the District Court of New Jersey’s decision in Cotto v. Ardagh Glass Packing, Inc., which dismissed a medical marijuana user’s NJLAD disability discrimination and failure to accommodate claims when his employer refused to reinstate him to full duty until he passed a drug test.

Michigan

In 2008, Michigan passed its Medical Marihuana Act (MMA), protecting medical marijuana users from criminal prosecution or other adverse acts by the state or a licensing board or bureau. The law does not specifically regulate private employment and contains no language to undermine or limit private employers’ decisions regarding their employees’ medical marijuana use. Thus, it has been left to the courts to ascertain whether any such limits exist. In Eplee v. City of Lansing, an unpublished decision issued earlier this year, the Michigan Court of Appeals clarified that the MMA “does not provide an independent right protecting the medical use of marijuana in all circumstances, nor does it create a protected class of users of medical marijuana.” The MMA mandates that no person be denied “any right or privilege” because of their medical marijuana use; however, the court held that this did not prohibit the firing of an at-will employee who had no right to employment. Less clear is how the MMA would apply to a different set of facts, such as where an employee’s contract specified that they could only be fired for cause. The Eplee decision is consistent with the Sixth Circuit’s 2012 ruling in Casias v. Wal-Mart Stores, Inc., which similarly upheld the dismissal of a Michigan employee’s medical marijuana employment discrimination claim.

As various jurisdictions continue to relax the laws regarding marijuana use, employers should stay up to date as to the effects of any such laws in jurisdictions in which they have employees.

*Research and drafting assistance for this post was provided by Reed Smith Summer Associate Jake Ziering.

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