LEGAL GUIDE
Written by attorney Jessica Peck

Marijuana and the Workplace: Understanding the Rights of Employers and Employees

Marijuana and the Workplace: Understanding the Rights of Employers and Employees

By Jessica K. Peck, Esq.

** Bio: Jessica is a Denver-based attorney who has represented dozens of medical marijuana businesses, patients and employers in civil, criminal, legislative, administrative and litigation settings. To view more of her analysis on marijuana-related issues, visit www.JPDenver.com.**

As the first state in the nation to legalize marijuana and recreational marijuana through its state’s Constitution, Colorado is uniquely positioned to lead the nation in the evolving nature of workplace relationships impacted by marijuana and marijuana rights.

Employers Now Almost Outnumbered By Legal Marijuana Users in State: According to a 2013 media report, researchers from the Colorado Futures Center at CSU have estimated that in 2014, 642,772 Colorado residents (about 12 percent of the state population) will purchase marijuana legally next year. “The CSU researchers assume that each marijuana user will buy approximately 3.5 ounces of pot during the year, for a grand total of 2,258,985 ounces of pot -- that's about 142,000 pounds or 71 tons," the Huffington Post reported. http://www.huffingtonpost.com/2013/05/20/coloradans-will-use-more-_n_3307431.html

With the U.S. Census Department estimating that Colorado is home to just under 600,000 distinct businesses, a rough analysis presumes that that the ratio of legal marijuana users to lawful, registered businesses will be one-to-one.

Bottom line: Even for those employers who haven’t come into contact with an employee who uses marijuana either on-the-clock or off, it’s only common sense to anticipate that they will need to assess and possibly reevaluate their workplace practices concerning drug testing and employee marijuana use in the near future.

Disclaimer: In response to frequent questions I receive from employers and employees both inside and outside the marijuana industry, I have provided the analysis below with the following disclaimers.

  1. This guide is being produced in 2013 and due to the rapidly changing nature of marijuana-related litigation, regulation and legislation, accuracy should be confirmed with the sources directly cited and due diligence should be undertaken to ensure that new cases or new laws haven’t altered this analysis or made any points herein inapplicable.

  2. A note of caution: Under a general legal presumption in Colorado, contracts (including legal contracts) are construed against the drafter when any contract terms are challenged by either party. Thus, it is critical to view any information contained in this guide in a most general context and not as specific legal recommendations upon which you should rely upon in drafting any employment agreements.

  3. All rights reserved, with republication or citation permitted in accordance with all laws governing the redistribution and republication of legal articles and analysis.

The Questions At Issue:

· Do Colorado employers have the right to prohibit marijuana use in the workplace? Outside of the workplace?

· Do employers have the right to randomly drug test employees?

· How have these rights been impacted in light of last November’s passage of Amendment 64, a state constitutional amendment that allows for adult marijuana use beyond that allowed under Colorado’s already existing medical marijuana constitutional and statutory protections?

· Finally, how have these rights been impacted in the aftermath of an April, 2013, Colorado Court of Appeals decision involving a medical marijuana patient and his employer’s right to fire him for his consumption while off the clock?

So the answer or answers? They are complicated, contingent upon many factors specific to each employer’s risk tolerance, liabilities, and employee and costumer demographics.

Taking Federal Law Out of the Question: If we assume that federal law isn't a factor in drafting employment agreements, manuals, hiring/firing and drug testing procedures (and I explain below why it is a factor) the rights and obligations of employees and the employers who hire them depend upon—or should be presumed based on—a multitude of factors, including but not limited to, the following:

  1. Type of employment (or independent contractor terms);

  2. Whether mandatory drug testing is a requirement of the job,

  3. Whether the person has a medical defense or is merely using recreationally under Amendment 64;

  4. Employer’s industry and its contact with consumers or clients;

  5. Whether employer’s business model involves driving, operation of machinery or other variables that could be impacted by off-duty employee marijuana use;

  6. Employer’s legal and insurance compliance/obligations;

  7. Employer’s history as it relates to law enforcement contact or litigation; and

  8. The regulatory nature of Employer’s ongoing and future state and licensing requirements.

What are Colorado Court’s Saying?: One of the most common questions we hear: how will a Colorado court view an employment dispute involving marijuana as a core issue? Courts are just as confused, in most cases, as most employers and employees. Some lower Colorado courts throw out any marijuana-related dispute since marijuana is still void under federal law. Others are handling such cases based on the underlying issue (employment dispute, landlord/tenant, etc.).

As you can see from this Denver Post report, the Court of Appeals was

split on the issue, 2-1, in April, 2013, regarding employee rights to off-duty marijuana use, ultimately siding with the employer.

http://www.denverpost.com/breakingnews/ci_23104820/colorado-appeals-court-oks-firing-off-duty-marijuana

The Colorado Supreme Court, the tribunal who will hear an appeal of this case, has not been especially friendly to medical marijuana plaintiffs, but given that this is the first case involving marijuana right since last November's Amendment 64 success, it’s anyone’s guess how justices will respond.

While the employee in the case above had a sympathetic story to tell, the Colorado Supreme Court may or may not view the issue differently in light of Amendment 64's passage. It may also want to segregate employee rights based on whether the employee is using marijuana recreationally or for medical purposes.

Notably, if this area of law (meaning marijuana rights specific to the workplace) shapes up the way it has for registered medical marijuana patients facing a loss of rights in other areas of Colorado law (such as parental rights), we may find that our courts evolve on questions regarding

marijuana rights of employees in the years to come. A decision in 2013 could look very different from what we might see in future years.

In addition, courts could also view marijuana-related rights more favorably in light of growing public support for federal legalization. The threat of a federal 1st Amendment suit was enough to get the state to back off a 2013 legislatively-imposed ban on the placement of marijuana publications in the open at retail storefront. http://www.thedenverchannel.com/news/local-news/marijuana/first-amendment-lawsuit-filed-over-colorados-new-marijuana-law

Of course, this case was about free speech and not about use of marijuana, but it does show the power of using federal 1st Amendment rights to defend against state-level anti-marijuana laws. As a practical matter, state agencies and employers may cave on litigation or voluntarily avoid legal disputes out of political or practical concern that the tide of public support has—and continues to—shift in support of marijuana-related rights and freedoms.

Conflicts Between Three Key Laws: Using federal constitutional protections to defend against state-level restrictions to a state-protected constitutional right has been successful in a handful of high profile cases. I was part of a legal team that successfully overturned the City of Centennial's ban on medical marijuana dispensaries where the city had used federal law to justify its prior ban on dispensaries. If you scroll down on this page, you will see a report on the case. http://www.jpdenver.com/Case_Studies.html

At the core, we have a conflict between three key laws. First, federal prohibition of marijuana; second, Amendment 64; and third, a state statute that protects employees from termination for certain off-duty legal activities.

Amendment 64's language states: "Nothing in this section is

intended to require an employer to permit or accommodate the use . . .

of marijuana in the workplace or to affect the ability of employers to

have policies restricting the use of marijuana by employees."

While C.R.S. § 24-34-402.5 generally makes it unlawful for an employer to

terminate an employee for engaging in lawful activity off the premises

of the employer during nonworking hours, Courts are likely to refer

back to the above provision to hold that it isn't required.

This position wouldn’t be a slam dunk, however, because courts could also read the two provisions together to find that while Amendment 64 doesn't require employers to allow marijuana "in the workplace" and it doesn't impact the ability of employees to have anti-marijuana policies, it doesn't

go so far as to say that employers can prohibit lawful use of marijuana outside the workplace so long as it doesn't impact employee

performance.

Also worthy of discussion, and further complicating the analysis, this

off-duty statute is subject to a couple of important, and perhaps ambiguous in light of marijuana as a key issue, exceptions:

Due to space limitations on this site, you will need to visit my site to view the remainder of this guide.

3.

Additional resources provided by the author

For more on Colorado's evolving legal framework related to medical marijuana and recreational marijuana in various contexts, including employment law, civil rights, criminal law, constitutional law, regulatory defense, and legislative developments, visit www.jpdenver.com

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