Can Small Businesses Fire Employees Over Medical Marijuana Use?

Date: July 01, 2014

A Colorado Supreme Court decision may set a precedent for other states.

Six months after the first legal retail sale of marijuana in Colorado, it’s clear employers still hold the trump card on drug policies in the workplace. That is, even if employees legally use marijuana off the clock, Colorado state law allows employers to implement drug policies and fire employees who violate them.

For many business owners, this isn’t a new issue. Since 1996, 20 states and Washington, D.C., have enacted laws legalizing medical marijuana use. Businesses in these states can determine disciplinary measures for employees who violate workplace drug policies by medical marijuana use. So far, when faced with resulting lawsuits from employees, courts in California, Oregon, Colorado and Washington have ruled in favor of employers.

But now, a case headed for the Colorado Supreme Court may change that.

Colorado’s Lawful Activities Statute Called Into Question

Brandon Coats, a quadriplegic man and Colorado medical marijuana patient, was fired from his job as a telephone operator at Dish Network in 2010 for using marijuana after hours. Coats challenged his termination, arguing he never used or was under the influence of marijuana at work. The lawsuit was brought forward under the state’s Lawful Activities Statute, which prevents employers from firing employees for engaging in legal activities in off-work hours.

So far, a trial court and the Colorado Court of Appeals have upheld Coats’ termination, saying the statute didn’t apply to marijuana use since it’s illegal under federal law. Earlier this year, however, the Colorado Supreme Court announced it would review Coats’ case, looking at whether the Lawful Activities Statute covers marijuana and whether the Colorado constitution gives medical marijuana patients a right to marijuana.

Federal Law vs. State Law in Medical Marijuana Cases

NFIB has filed an amicus brief in support of Dish Network. “It is NFIB’s position that public safety and federal law must take priority over state marijuana laws,” says Tony Gagliardi, NFIB’s Colorado state director. “Should the Court rule in favor of Coats, Colorado’s employment law and the laws of other states will be thrown into disarray for years to come.”

Gagliardi hopes the Court takes into consideration how the ruling could impact Colorado employers, including many in industries required by law to maintain drug-free workplaces, such as transportation and government contracting.

If the Court reverses the lower courts’ rulings, Colorado employers will have to consult with employment counsel to determine whether they can legally implement drug policies in the workplace, and how those policies may be enforced going forward, says Karen Harned, executive director of the NFIB Small Business Legal Center. Future evaluations of drug policy violations may mean employers have to prove whether employees’ after-hours marijuana use negatively impacts their job performance in order to have a case for termination—and the scientific data on marijuana impairment is so new that it can’t be relied on yet, Harned says.

With the tide turning on marijuana legalization—recent polling results show that 54 percent of Americans support it and 75 percent believe it’s inevitable—this case is one to watch. The decision likely will be issued in the summer or fall of 2014.

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