HR, Meet THC: Bosses Told to Prepare for Cannabis

Robbin Rahman of the Barber Law Firm says medical cannabis could cause some HR headaches.
Robbin Rahman of the Barber Law Firm says medical cannabis could cause some HR headaches. (Karen E. Segrave)
Adam Hodge is the co-founder of Growbrite Risk Management, specializing in cannabis operations.
Adam Hodge is the co-founder of Growbrite Risk Management, specializing in cannabis operations. (Karen E. Segrave)

Medical marijuana is now legal in Arkansas and due to hit the market in six weeks, but in case any bosses are wondering, workers have absolutely no right to clock in while zoned out.

Even medically certified patients can be disciplined for being impaired on the job.

Beyond that — and a pressing need for businesses to update employee handbooks and drug policies — little is certain. But lawyers, compliance professionals and the Society for Human Resource Management are warning companies to get ready.

Arkansans voted in 2016 to change the state Constitution to allow medicinal cannabis, and current law includes protections for both patients and employers. Bosses have wide latitude to designate “safety-sensitive” positions requiring cannabis abstinence, and to insist on a safe and efficient workplace.

Case law, which at first favored employers but has swung toward workers, will eventually sharpen the line on whose rights prevail. Experts consulted by Arkansas Business added that legal issues will stay complicated as long as federal law criminalizing marijuana conflicts with the laws of 30 states with medical marijuana programs.

“Without getting into the weeds, Arkansas has a modicum of employee protections baked into [Amendment 98], provisions broadly described as anti-discrimination,” Little Rock business lawyer Robbin Rahman said. For example, having a cannabis qualification card cannot legally trigger an adverse job action, or any denial of professional licensing.

But in 2017, Arkansas lawmakers gave employers a collection of “safe harbors” to keep broad authority over the workplace, said Rahman, a business practices attorney with the Barber Law Firm. “Since the amendment was silent on what an employer could or couldn’t do, the Legislature was left to put meat on the bones, and it gave employers the right to designate safety-sensitive positions, to not have to accommodate cannabis use in the workplace, etc. It was an attempt to bring this within an existing framework.”

A fact sheet from SHRM notes that states with legal recreational marijuana provide no employment protections for those users, and that “even if an employee is a registered medical marijuana user, as with alcohol, employers never have to tolerate on-the-job use or intoxication.”

Workplaces like the federal courthouse in Little Rock and the University of Arkansas for Medical Sciences can also continue to restrict marijuana use by employees like guards and nurses, even when they’re off duty. Safety-sensitive designations permit continued drug testing of truck drivers, heavy equipment operators, air-traffic controllers, police officers and the like, as well as workers covered by drug-specific employment contracts.

Make Rules Reflect Culture
Adam Hodge, a Little Rock risk management and insurance specialist, said Arkansas companies must look to their own business goals and corporate cultures, but should generally avoid taking the most restrictive line possible.

“For me it comes down to employer policy,” said Hodge, a former risk consultant to insurance broker Insurica with a new enterprise, Growbrite Risk Management. “Every company has to update policies concerning drug or prescription use, and those policies need to reflect the culture and goals of the company.”

In a tight job market that has already cut the use of pre-employment marijuana screening, Hodge said, many companies no longer want to eliminate a whole pool of job candidates just because they use cannabis at home. “There are safety-sensitive positions, and there may be other jobs where you might want to restrict cannabis use, just as you do today for prescription medicines. There are a lot of drugs I wouldn’t want in the system of somebody operating a truck or a piece of machinery. But you shouldn’t get crazy about what positions you declare as safety-sensitive; I caution most employers against over-classifying.”

One problem is that no proven test exists to determine marijuana intoxication levels at any given time, as breath and blood analyses allow for testing drunkenness. “A standard test shows evidence of marijuana use over time, but can’t determine how impaired a person is at the moment,” Rahman told Arkansas Business.

Gregory Northen, an attorney with Cross Gunter Witherspoon & Galchus PC in Little Rock, noted that prohibitions against cannabis impairment at work are written into the constitutional amendment. And he suggested that updated company policies require reasonable suspicion before testing non-safety-designated workers.

“Supervisors need to know the signs to look for, all while respecting the privacy of individuals. You don’t want to ask too many prying questions,” Northen said, or employees might allege privacy violations. “The important thing is balance, the safety and business interests of the employer weighed against their employees’ new constitutional right to use medical cannabis. The conflict between state and federal law complicates the equation.”

Businesses should list positions, not employees, as safety sensitive, and the designation needs to be in writing and dated, he said. “You want to have solid and strong communication with your workforce, but I wouldn’t advise clients to ask if an employee has a medical marijuana card, because that could be in violation of other laws.”

Looking at Liability
Drug tests will still be commonplace in investigating accidents, with liability the key issue, he said.

“If there’s an accident at the workplace or a courier has a traffic crash and testing for the medical marijuana card holder comes back positive, that won’t determine whether the employee was impaired at work, but insurance may deny coverage. If a manufacturing worker loses an arm, will workers’ compensation pay for that? Employers could face huge liabilities, and for this quagmire, we need guidance from the courts.”

Arkansas’ 2017 law, Act 594, says employers can take action against workers if they have a “good-faith belief that someone is using medical marijuana on premises,” Rahman said. “It can’t be solely based on a positive test, though; you have to have other signals like the employee acting erratically, smelling like marijuana or doing something outside normal behavior.”

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Licensed Marijuana Cultivators in Arkansas, with investors ranked by ownership stake.

Every employer is different, Northen said, and employers subject to employment agreements with the federal government, or workers who have pledged not to commit federal crimes, may be required to restrict medical cannabis use.

Some employers will be more tolerant than others, Rahman said, but all companies will need updated employment guidelines and handbooks. “You don’t have to throw out or completely redesign them,” he said, “but you need to look at everything to make sure to make accommodations for medical marijuana in a health and welfare regimen.”

Hodge, viewing cannabis use from an insurance and compliance perspective, says employers must look at all job descriptions and identify those that are “absolutely safety sensitive,” then evaluate medication use rules for other workers. “Are there prohibitions against any and all marijuana use? Then you’ll need some accommodation for medical cannabis.”

New employees should be briefed on policy as they start, he said. “I’d make it part of the onboarding process, to make company policy clear on the front end, avoiding misunderstandings. And every employee should sign to say they understand the rules.”

Growbrite, Hodge’s new business with partner Adam Grimmett, offers risk management, compliance, bonding and insurance services for cannabis operations and related businesses. Thus, he makes no bones about promoting medical cannabis. “We’re working to be the specialist in this particular industry,” he said, an industry where even getting insurance coverage for a building can be difficult.

“There are not many carriers from an insurance perspective, and they’re specialized,” Hodge said. “There’s no cookie-cutter coverage in the cannabis industry, because every business has to be looked at on its own, and that makes the underwriting very detailed. We deliver all those details to the underwriters and put together that narrative.”

Cannabis Here to Stay
Rahman commended Arkansas for its “thoughtful” approach to protecting both employers and workers who use medical cannabis. “Legacy states like California and Washington didn’t really do much to protect patients in the employment context or anything else, and in the first cases alleging wrongful termination, the employer always won,” he said. “The new feature of laws in places like Arkansas, Illinois, Massachusetts and Michigan is thinking about the issue more carefully, treating cannabis use more like other medicines. This is where the anti-discrimination language comes in, and where it’s a departure from the historical approach.”

Jim Reidy, a New Hampshire attorney and frequent speaker for the Society of Human Resource Management, says the rise of legal marijuana use has complicated corporate drug-testing practices.

“With the change in the economy the last two years, employers have increasingly been dropping marijuana from post-offer, pre-employment drug testing, and a lot of employers have been dropping random testing, too,” said Reidy, a labor lawyer at Sheehan Phinney of Manchester, who said his recent focus on cannabis law spurred his grown daughter to call him, jokingly, “Jim Weedy.” “Some companies will shy away from testing altogether, relying on measurable metrics like performance and attendance.”

SHRM said last month that case law is shifting toward more tolerance for employees using cannabis. “Early cases tended to hold that employers need not accommodate cannabis treatment,” lawyers Dean Rocco and Noelle Sheehan wrote, citing Oregon and California supreme court rulings that upheld the firings of employees who broke company marijuana use rules. Appeals rulings in Washington state and Montana also upheld employers’ who punished medical cannabis use.

But recent court decisions in Massachusetts and elsewhere have favored employees, Rocco and Sheehan wrote. They named Arkansas among 10 states that enacted protections for medical marijuana patients, but noted that even these statutes “make exceptions for use by employees in safety-sensitive and federally regulated positions.”

Rahman expects case law to continue to evolve. “First,” he said, “I think anyone who thinks medical marijuana isn’t here to stay is probably fooling themselves, whatever your business may be. Not too far down the road medical cannabis will be treated just as a medicine that some people use. Smart businesses will adjust to that.”

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