Medical cannabis is on the move, and on the minds of employers everywhere – and not for their personal use. There are numerous employment law implications for state-sanctioned cannabis use. Scenarios range widely, from states such as Washington and Colorado (which have legalized recreational cannabis), to Kentucky, which  limits use very specifically to only non-smokable Cannabidiol (CBD) oils for adults with intractable epilepsy who are participating in a clinical trial. Regardless of the particulars, it is crucial for employers everywhere to understand how their employment policies and practices should be modified to account for these new statutes.

Right now there is little guidance about what the new laws mean for employers, raising questions such as: What does the law require of employers, and what are the risks? How do you respond to job candidates who disclose that they are medical cannabis cardholders? What can you do about employees who ask for a cannabis accommodation? Should employees be disciplined if they fail a drug test or show up to work impaired? Are companies required to expand employee benefit offerings to cover cannabis use? How do the new laws affect businesses that value creative employees and are worried about losing prospects who may be recreational cannabis users?

Also see: The top employment issues of 2015

Not surprisingly, the answer to each of these questions is: "It depends." 

Drug-free workplace still OK

The good news is, despite the wide range of cannabis program laws, consistent themes have begun to emerge. Aside from the basic notion that the federal government continues to view cannabis as a Schedule 1 controlled substance and, therefore, illegal for possession or consumption, state regulations do offer some additional clarity for employers. At this time, courts across all jurisdictions have consistently ruled in favor of employers' rights to implement and enforce zero-tolerance, drug-free workplace policies. 

The Colorado Supreme Court surprised observers in Coats vs. Dish Network when it ruled in favor of Dish Network. Dish had fired Brandon Coats, an individual with quadriplegia and registered medical cannabis patient under Colorado law, after he tested positive for tetrahydrocannabinol (THC) during a random drug test. Mr. Coats disclosed his state medical cannabis registration to Dish, and conceded using cannabis only outside of the workplace. The courts found in favor of Dish, noting cannabis use is not "lawful activity" under state law giving rise to a discrimination cause of action – even in a recreational cannabis state like Colorado. 

Also see: Colorado, Washington laws don’t send employer drug policies up in smoke

Don't fire first, ask questions later

The nuances surface when an employee discloses that he or she is a medical cannabis patient registered with the state. Unless your profession falls under the umbrella of public health and safety, you should think twice before taking an adverse employment action against an employee based solely on this information. Nearly all cannabis industry states have a nondiscrimination-in-the-workplace clause, and disciplining an employee who is licensed by the state to use cannabis has limitations in the majority of these states. Some exceptions exist on a state-by-state basis with regards to traditional health care, labor, transportation and law enforcement jobs.

Pot accommodations are usually discretionary

If an employee discloses a disability and claims to require cannabis for treatment purposes, are employers required to accommodate that employee by allowing cannabis use that is detectable in a drug test? Most states do not require an employer to allow cannabis in the workplace for a "disability accommodation," but there are certain exceptions in Arizona, Nevada and New York. Though a particular state may not require such an accommodation, the employer may nonetheless need to accommodate the underlying disability and medical condition. 

Also see: Review workplace drug policies in light of new state laws

How to handle impaired employees

Employers should consider protocols for responding to employees who come to work impaired. Whether an employee is visibly impaired in the workplace or a drug test shows the presence of THC weeks after use, employers should have an established plan to respond appropriately. Many employers already have policies for impaired employees, and instances surrounding state-legalized cannabis can be handled in the same manner as long as employers remain consistent in their approach. 

For example, if an employer regularly provides counseling or warnings to employees impaired by alcohol, the employer should follow the same steps when confronting cannabis impairment. Also, keep in mind that employees who use medically prescribed cannabis are often suffering from constant pain, nausea, or even worse conditions. Treating such employees with compassion may reduce the likelihood of workplace discrimination claims and will reinforce that the “human” aspect of human resources is important to the company.

Insurance considerations

Employee benefits packages are unlikely to change regardless of the scope of cannabis legalization. Health insurance companies do not cover medical or recreational cannabis, so a company’s insurance rates should not change due to employees who use cannabis. Substance abuse benefits and employee assistance programs already exist in benefits portfolios, and use of such coverage may increase in recreational cannabis states. Although cannabis is commonly understood to have no physically addictive properties in adults, psychological addictions may develop. Lastly, although cannabis generally is not covered for treatment of a workplace injury, case law rulings are still percolating.

Some companies embrace a cannabis culture

A one-size-fits-all approach to cannabis use not only fails to account for the tangled web of cannabis laws, it falls short in supporting different corporate cultures. Companies that focus on sourcing creative employees or millennials are only the first to come around on cannabis-friendly work environments. As public opinion rapidly shifts to support medical and even recreational cannabis, employers are taking notice. For example, drug-free workplaces simply may not be practical for a start-up technology company with young and creative employees. Creating an environment where cannabis users are comfortable and feel safe in their employment will encourage loyalty and may even attract more candidates in target demographics.

Also see: 7 signs of a toxic workplace culture

Employers will increasingly encounter workplace challenges due to medical and recreational cannabis legalization. Now is the time to review current policies to ensure they align with state regulations in order to minimize claims brought by employees. 

Bob Morgan is a health care attorney and cannabis industry consultant at Chicago-based law firm Much Shelist. He served as the first statewide project coordinator for the Illinois Medical Cannabis Pilot Program, managing implementation of its highly regulated medical cannabis industry. He advises businesses across the country on health care compliance and the impact of the cannabis industry. He can be reached at

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