1. © 2011 Sherman & Howard L.L.C. How Does the Legalization of Recreational and Medical Marijuana Affect Your Employment Policies? Vance O. Knapp, Esq., Partner Labor and Employment Department, Sherman & Howard L.L.C. 633 17 th Street Ste. 3000, Denver, CO 80202 (303) 299-8162 vknapp@shermanhoward.com www.shermanhoward.com vknapp@shermanhoward.com www.shermanhoward.com

2. © 2011 Sherman & Howard L.L.C. BACKGROUND 23 states and the District of Columbia have legalized possession and use of limited amounts of marijuana for medical purposes. Colorado and Washington state have also legalized limited amounts of marijuana for recreational purposes.

3. © 2011 Sherman & Howard L.L.C. BACKGROUND In Colorado, Amendment 64 Legalized Recreational Marijuana-- –Marijuana to be obtained as easily as alcohol. –Allows individuals 21 or over to cultivate, use and possess limited amounts of marijuana, without having to be certified as having a serious illness or debilitating health condition.

4. © 2011 Sherman & Howard L.L.C. Marijuana is Still Illegal Under Federal Law or Is It? “We’ve got bigger fish to fry,” President Obama in response to a question concerning prosecution of marijuana users by Barbara Walters on ABC’s “Good Morning America” on December 14, 2012.

5. © 2011 Sherman & Howard L.L.C. Marijuana is Still Illegal Under Federal Law or Is It? On August 29, 2013, The U.S. Department of Justice issued a memorandum to all U.S. Attorneys updating its Guidance on marijuana enforcement. –The DOJ is deferring its right to challenge legalization efforts at this time.

6. © 2011 Sherman & Howard L.L.C. Bipartisan Congressional Support Representatives Dianna DeGette (D) and Mike Coffman (R), have introduced the “Respect States’ and Citizens’ Rights Act,” in Congress. –The bill is designed to exempt states from the federal Controlled Substances Act provision on marijuana—this bill is still pending.

7. © 2011 Sherman & Howard L.L.C. Drug Free Workplace Act Applies to any organization that receives a Federal contract of at least $100,000 to establish a drug-free workplace. –It also requires that all organizations receiving Federal grants of any size establish and maintain such a policy. –Does not require employers to drug test employees.

8. © 2011 Sherman & Howard L.L.C. ADA Issues Involving Marijuana ADA does not require employers to accommodate the use of marijuana. –However, if an employee enters a substance abuse program, employers have to accommodate the employees participation. ADA does not consider drug testing to be a medical examination.

9. © 2011 Sherman & Howard L.L.C. Accommodation of Medical Marijuana Beware, some state anti-discrimination laws do not address marijuana use as an accommodation. –Plaintiff’s counsel could argue in states that have legalized medical marijuana, that under state anti- discrimination laws, an employee’s use of marijuana to ameliorate the effects of a disability constitutes a reasonable accommodation.

10. © 2011 Sherman & Howard L.L.C. Federal Status Bottom Line—marijuana remains classified as a Schedule I narcotic under the Federal CSA –Marijuana cultivation, distribution, possession and use are still criminal acts under federal law. –Marijuana is in the same category as Cocaine, Heroin, LSD and Ecstasy.

11. © 2011 Sherman & Howard L.L.C. Can I Regulate My Employees’ Use of Marijuana? YES! –At a minimum, employers in all 50 states and the District of Columbia can regulate an employee’s use of marijuana by: Prohibiting marijuana possession and use at work; and Reporting to work impaired or under the influence of marijuana.

12. © 2011 Sherman & Howard L.L.C. Can I Regulate My Employees’ Use of Marijuana? In Colorado both Amendment 20 (medical marijuana) and Amendment 64 (recreational marijuana) provide that employers do not have to accommodate employees use of marijuana.

13. © 2011 Sherman & Howard L.L.C. Can I Regulate My Employees’ Use of Marijuana? Benoir v. Industrial Claims Appeals Office –Employee can be denied unemployment for testing positive for marijuana in violation of employer’s zero tolerance drug policy. –Medical Marijuana Amendment only provides an affirmative defense to criminal prosecution.

14. © 2011 Sherman & Howard L.L.C. Can I Regulate My Employees’ Use of Marijuana? Employers may restrict the use of marijuana by employees; but can employers prohibit, the lawful off-duty and off-premises use. –Does having a trace amount of THC in your body constitute use or possession at work? –When is an employee “impaired” or “under the influence” by THC? –Combating employees’ perceptions concerning their “constitutional right” to use marijuana v. reality.

15. © 2011 Sherman & Howard L.L.C. Can I Regulate My Employees’ Use of Marijuana? Colorado’s Lawful Off-Duty Activities Statute, C.R.S. §24-34-402.5, makes it a discriminatory or unfair employment practice to terminate an employee who is engaged in lawful off-duty, off-premises activities. Coats v. Dish Network, the Colorado Court of Appeals held that medical marijuana use is not lawful for purposes of Colorado’s Law Off-Duty Activities Statute.

16. © 2011 Sherman & Howard L.L.C. Can I Regulate My Employees’ Use of Marijuana? The Colorado state legislature has passed a driving under the influence of marijuana bill. –This bill sets the threshold for impairment at 5 nanograms, and allows a defendant to argue at trial that they were not impaired.

17. © 2011 Sherman & Howard L.L.C. Policy Options No Testing v. Reasonable Suspicion/Post Accident Testing v. Random Testing

18. © 2011 Sherman & Howard L.L.C. Policy Options Beware local drug testing ordinances. Is there a threshold for impairment?

19. © 2011 Sherman & Howard L.L.C. Can I Still Have a Zero-Tolerance Drug Policy? Yes, but--“Damn lawyers! There is always a but!” –Marijuana is still illegal under federal law. You could have a zero-tolerance policy for positive test results and the courts would probably uphold your right to terminate an employee for a positive test. –However, the expense to defend a wrongful termination suit through the appeal process could easily cost $300,000 in legal fees and costs.

20. © 2011 Sherman & Howard L.L.C. How Should I Address Marijuana Use in My Employment Policies? Review your substance abuse policy to ensure its restrictions concerning marijuana use are consistent with the restrictions contained your respective jurisdiction. –E.g., “Acme Company does not permit the possession, distribution or use of illegal substances (including medical and recreational marijuana).”

21. © 2011 Sherman & Howard L.L.C. How Should I Address Marijuana Use in My Employment Policies? Review your job descriptions—can you make a case for all employees having safety sensitive positions? If not, why? Treat similarly-situated employees the same.

22. © 2011 Sherman & Howard L.L.C. How Should I Address Marijuana Use in My Employment Policies? The ADA does not require employers to accommodate the use of marijuana to mitigate the effects of a disability. –However, some state anti-discrimination statutes may require accommodation of medical marijuana use. Educate your employees and guests about your marijuana possession and use policies.