Hunton Retail Law Resource

In the first four months of 2021, Virginia, New Mexico, New York and New Jersey passed laws legalizing or decriminalizing, in some form, recreational marijuana.  Exactly how these laws will affect employers in these states is still an open question, but for now, employers should understand the nuances of the laws so they can prepare for the emerging reality that is legal marijuana.  For retail employers, this means renewed attention to drug use and drug testing policies.  Retailers, for the most part, are still able to enforce policies against drug use at work, but must be mindful of how these policies, especially with regards to testing and marijuana, could leave them open to claims of discrimination or state law violations.  At a minimum, retailers should review their policies for each state in which they operate, as a “one-size-fits-all” approach may no longer be practical.

Recent Laws

New Mexico’s law, which takes effect in June 2021, legalizes recreational marijuana use and sales for people over age 21.  The law allows employers to test for marijuana but has protections for medical marijuana users, which means employers, with limited exceptions, are prohibited from taking adverse action against applicants and employees who have a prescription for and/or use medical marijuana.

New York’s law allows individuals who are at least 21 years old to possess, use, and transfer (without compensation) limited amounts of cannabis.  With some narrow exceptions, employers are prohibited from taking adverse employment action against employees solely because of their use, recreational or otherwise, of cannabis before or after their work hours.  Employers, however, may still prohibit employees from using cannabis while working, on the employer’s premises, or while operating or using the employer’s equipment or property.

New Jersey’s law legalized the sale, use and possession of recreational marijuana for individuals 21 and older.  The law does not restrict an employer from maintaining and enforcing drug-free workplace policies but, when it comes to marijuana, requires employers to show use and/or impairment at work, as opposed to off-duty use, before the employer can take adverse employment action.

Virginia’s new law (HB 2312 / SB 1406) legalizes home cultivation and personal possession of cannabis beginning July 1, 2021, and retail sales to individuals 21 years and older beginning January 1, 2024.  An amendment to existing law (HB 1862) provides employment protections for medical marijuana cardholders by prohibiting employers from terminating, disciplining, or otherwise discriminating against an employee “for such employee's lawful use of cannabis oil pursuant to a valid written certification.”  While the statute provides anti-retaliation protections for an “employee’s lawful use of cannabis oil based on a valid written certification,” it does not: (i) restrict an employer's ability to take adverse action for an employee’s impairment while at work or to prohibit possession during work hours; (ii) require an employer to commit any act that would cause the employer to be in violation of federal law or that would result in the loss of a federal contract or federal funding; or (iii) require any “defense industrial base sector employer or prospective employer” to hire or retain any applicant or employee who tests positive for marijuana in excess of specified amounts.  See our recent post concerning employment protections for medical use of cannabis oil.

Under each of these laws, the requirements employers must meet in order to justify adverse employment action can be difficult to ascertain.  Also, the various state administrative agencies tasked with providing guidance regarding these laws have not produced final versions of that guidance.  Even when such guidance is available, however, questions for employers will remain.  Much of what employers can and cannot do under these laws depends on the type of work in which the employees are engaged and the nature of the employment policies at issue.  There will likely not be a “one-size-fits-all” approach to navigating this new legal landscape and employers should be mindful of this as they contend with the prospect of broadening legalization of marijuana.