A combination of New Jersey court decisions and legislative actions have expanded and clarified New Jersey employer obligations for employees who are registered qualifying cannabis patients. Both the New Jersey Federal District Court and the New Jersey State Appellate Division have weighed in, with the New Jersey Supreme Court recently announcing that it will review the Appellate Division ruling. Further, on July 2nd, New Jersey signed into law an amendment to the New Jersey Compassionate Use Medical Marijuana Act, now known as the Jake Honig Compassionate Use Medical Cannabis Act, which creates additional compliance obligations for employers. The Act takes effect immediately. Now is the time for employers to review their policies and ensure compliance with the new law and recent court decisions.

Earlier this year, we blogged about the New Jersey District Court’s decision in Cotto v. Ardagh Glass Packing, Inc., 2018 WL 3814278 (D.N.J. Aug. 10, 2018), and the New Jersey State Appellate Division’s decision in Wild v. Carriage Funeral Holdings, Inc., et al., A-3072-17T3 (App. Div. Mar. 27, 2019), here and here, which came to seemingly opposite conclusions on motions to dismiss where employees were registered qualifying cannabis patients. In Cotto, the New Jersey District Court held that an employer did not discriminate against an employee on the basis of a disability when it refused to waive a drug testing requirement as an accommodation for the employee’s medical marijuana use. A little over six months later, the New Jersey State Appellate Division issued its decision in Wild, holding that employers may be required to accommodate an employee’s use of medical marijuana. On July 9, 2019, the New Jersey Supreme Court agreed to hear the Wild case indicating it will provide the final word on this issue for New Jersey employers. Stay tuned for a blog about the Supreme Court’s decision.

In the interim, the Jake Honig Compassionate Use Medical Cannabis Act was signed into law, which contains specific compliance obligations for employers and alters the some of the statutory language that was relied on by the District Court in the Cotto decision. The Act defines “adverse employment action” and affirmatively prohibits employers from taking an “adverse employment action” against an employee who is a registered qualifying patient based solely on the employee’s status as a registrant. Employers with drug testing policies must provide written notice and offer the employee or job applicant an opportunity to present a legitimate explanation for the positive test result. Within three working days after receiving this notice, the employee or applicant may either submit information to the employer to explain the positive drug test or request a confirmatory retest of the original sample at the employee’s or applicant’s expense. The employee’s or applicant’s presentation of an authorization for medical cannabis issued by a healthcare practitioner or a registry identification card is sufficient to provide a satisfactory explanation for the positive result.

Under the Act, however, employers may still prohibit and/or take adverse employment action for the possession or use of intoxicating substances during work hours or on work premises. Further, an employer would not be required to commit any act that would cause it to be in violation of federal law, that would result in a loss of a licensing-related benefit pursuant to federal law, or that would result in the loss of a federal contract or federal funding. Nor would an employer be penalized or denied any benefit under state law solely on the basis of employing a person who is a registry identification cardholder registered with the commission.

If an employee advises he or she uses medical cannabis, would fail a drug test, or refuses to take a drug test, New Jersey employers should understand their obligations under the Act and should consult with counsel before taking any adverse employment action. Should you have any questions, or if you would like to discuss how this new law may impact you, please contact your regular Saul Ewing Arnstein & Lehr labor and employment attorney.

DISCLAIMER: Per federal law, marijuana is a Schedule I controlled substance. This means that it is a federal crime to sell, distribute, possess, and/or use marijuana or marijuana-derived products, regardless of any state law that may authorize certain marijuana activity. Although federal policy may, at times, recommend enforcement discretion when a business or individual is in compliance with state marijuana law that is deemed to comply with federal enforcement priorities, it is important to understand that compliance with state law does not equal compliance with federal law, and that federal marijuana policy may change at any time. No legal advice we give regarding marijuana law or policy is ever intended to guide or assist clients in violating federal law.