Decriminalizing Cannabis – How Employers Will Adapt To Evolving Marijuana Laws

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OVERVIEW

Over the past couple of years, governments around the world have loosened the legislation surrounding the cultivation, processing and sale of marijuana. At the moment, some 60 countries have either decriminalized recreational or medical use of cannabis or are turning a blind eye to its consumption.

Canada hit the headlines in 2018 with its countrywide legalization of recreational cannabis. In 2019, Sydney became Australia’s first jurisdiction to legalize recreational marijuana. As of January 1, 2020, in the U.S., 11 states and the District of Columbia will have legalized recreational cannabis use by adults. In one estimate, by 2024, legal licensed cannabis sales will reach $40.6 billion annually worldwide.

Along with recreational cannabis, the medical marijuana market is also growing significantly. A survey commissioned by the American Society of Anesthesiologists found that more than two-thirds of those surveyed have used or would consider using cannabinoid compounds such as CBD or marijuana to manage pain. The global medical marijuana market is expected to grow by more than $25 billion from 2018 to 2022. In the U.S., 35 states have already passed medicinal cannabis regulations.

“When entirely new industries are formed, frameworks – from regulations to workplace policies – are critical,” says Stéphane Lespérance, president of commercial risk and health for Aon Canada. Indeed, with increased recreational and medical personal use, many employers in Canada, the U.S. and elsewhere are being forced to reconsider their policies when it comes to marijuana use among employees. As they do so, these companies, especially those in the U.S., must also navigate a patchwork of state laws governing drug testing in hiring and terminating employment decisions. A tight labor market adds further complication, with companies often struggling to find qualified candidates for various positions.

“As they respond to cannabis legalization, the top concerns for employers revolve around safety. From identifying an impaired employee to addressing behavior, employers have an obligation to maintain safety standards,” says Carol Zeneberg, vice president and claims consultant for Aon. “As cannabis use becomes more widespread, policies are critical to address impairment on the job.”

IN DEPTH

More than a year into the countrywide Cannabis Act in Canada, Lespérance says, “Employers have been establishing and refining robust cannabis-use policies and procedures, as well as reviewing any existing policies related to drug and alcohol use and disability and accommodation.”

The landscape is slightly more complicated to navigate in the U.S., as states have varying laws concerning the legality of cannabis and workers’ rights, and approaches to policies vary.

The Challenge Of Getting Workplace Drug Policies Right

Most U.S. state laws legalizing marijuana use allow employers to discipline employees for violating company drug policies or being impaired in the workplace. As recreational cannabis becomes more commonplace, businesses should review their workplace drug policies and ensure that they share those policies and any changes with employees.

“It’s key that employers have a policy in place, whether they’re going to allow medicinal or recreational marijuana,” says Zeneberg. “If they’re not going to allow it, they have to clearly specify that.”

Faced with a tight labor market, some employers are eliminating marijuana from the panel of drugs included in preemployment testing. “A lot of employers feel that if they continue preemployment testing for marijuana, they may eliminate good job candidates,” says Zeneberg.

But eliminating the testing isn’t an option for companies with federal contracts or grants. Federal law requires those workers be drug tested, including for marijuana. State and local laws can be another factor. For example, Nevada is poised to become the first state to restrict preemployment marijuana testing, and New York City has passed a bill prohibiting employers from forcing job applicants to take tests for marijuana use.

Policies Should Fit The Nature Of The Work

With more and more countries and states legalizing marijuana use, the right approach to workplace drug policies depends on the nature of the business, the tasks workers perform and the risks involved.

The risks posed to coffee shop baristas, for example, are far less serious than those to drivers or construction workers. Zeneberg encourages companies to consider the work at hand to craft the appropriate policy.

In addition, policies must be detailed and distributed to all employees, and supervisors and managers must receive regular training on the policy. Companies must also establish methods for employees to challenge any discipline for drug-policy violations.

Ultimately, employers’ approaches to alcohol use in the workplace could provide a useful model for recreational cannabis policies. The solution, however, might not be like for like just yet, as current tests merely detect the presence of THC – the major psychoactive substance present in cannabis, which remains in the body for three to 30 days – as opposed to the amount. More accurate tests are in the works; University of Pittsburgh researchers recently announced a prototype similar to an alcohol breathalyzer that would more accurately measure the presence of THC.

New Cannabis Laws, New Business Challenges

As cannabis laws evolve and the industry grows, businesses must determine how to operate in the new environment.

As new industries emerge, their growth can be faster than the pace of regulations. In today’s evolving climate, it’s imperative that organizations understand the broader implications and plan accordingly. The U.S. will face challenges similar to those Canada has encountered as it has moved to legalize marijuana: How must today’s policies evolve to reflect the current environment? How can various safety and workplace standards be maintained, and in some instances, enhanced?

“The answers to these questions will vary across industries,” says Richard Golz, cannabis and hemp consultant for Aon’s commercial risk solutions. “It’s critical that organizations understand their risk profiles within various scenarios to best plan and prepare for a new normal – whatever that new normal might be.”