Client Alert: Employers Receive Guidance from the New Jersey Supreme Court on How Medical Cannabis Can Impact a New Jersey’s Law Against Discrimination Claim

March 10, 2020

In a decision that is significant to employers across New Jersey, the New Jersey Supreme Court has affirmed the Appellate Division’s reversal of the grant of a motion to dismiss a medical cannabis patient-employee’s New Jersey Laws Against Discrimination (“NJLAD”) claims for wrongful discharge. Justin Wild v. Carriage Funeral Holdings, Inc. (A-91-18) (082836). Based upon reasoning similar to the Appellate Division, the Court held that a patient-employee may have an actionable NJLAD claim for an alleged unlawful adverse employment action related to his out of the office use of medical cannabis.

Nonetheless, the Court declined to adopt the Appellate Division’s view that “the Compassionate Use Act intended to cause no impact on existing employment rights.” Id. Rather, the Court determined:

Plaintiff’s [NJ]LAD disability discrimination claim derived in part from his assertion that, outside the workplace, he lawfully used medical [cannabis] prescribed for him in accordance with the Compassionate Use Act, which decriminalized the use of medical [cannabis] for “any qualified patient, primary caregiver, alternative treatment center, physician, or any other person acting in accordance with” its terms. N.J.S.A. 24:6I-6(a) (2018); N.J.S.A. 2C:35-18.

The Court reasoned that “Plaintiff specifically alleged that his medical [cannabis] was prescribed for “medical treatment [and] pain management” pursuant to the Compassionate Use Act. As plaintiff acknowledged at oral argument, had the Legislature not enacted the compassionate Use Act, he would have no [NJ]LAD claim for disability discrimination or failure to accommodate following the termination of his employment.”

Importantly, the Supreme Court cautioned that not all medical cannabis use will be protected by the Compassionate Use Act and NJLAD.  Specifically, the Court that ruled that two provisions of the Compassionate Use Act may affect a NJLAD discrimination or failure to accommodate claim in certain settings: (1) N.J.S.A. 24:6I-14 (2018) provides that “nothing in [the Compassionate Use Act] shall be construed to require… an employer to accommodate the medical use of marijuana in any workplace[;]” and (2) N.J.S.A. 24:6I-8 (2018) provides that the Compassionate Use Act “shall not be construed to permit a person to: a. operate, navigate or be in actual physical control of any vehicle, aircraft, railroad train, stationary heavy equipment or vessel while under the influence of [cannabis].” To the extent one of these provisions are implicated, the Compassionate Use Act may affect the viability of a NJLAD disability discrimination claim.

The Supreme Court’s ruling is consistent with recent amendments to the Compassionate Use Act, which went into effect on July 2, 2019 (the “Amendments”). The Amendments expressly prohibit employers from taking any unlawful adverse employment action against an employee or job candidate who is a registered qualified cannabis patient based solely on that employee’s or job candidate’s status as a registered qualified cannabis patient.

Specifically, the Amendments permit employers to take lawful adverse employment action against a registered qualified cannabis patient if that employer can show that a non-discriminatory reason exists for its employment decision. However, employers may still prohibit “the possession or use of intoxicating substances [including medical cannabis] during work hours or on the premises of the workplace outside of work hours.” Accordingly, if an employer has a policy against the consumption of drugs and alcohol during work hours or on the employer’s premises and a qualified cannabis patient violates that policy, then the employer is permitted to utilize an adverse employment action. Additionally, employers will not be forced to “commit any act that would cause the employer 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.”

Further, the Amendments now impose additional procedures on employers who conduct drug testing of employees and job applicants. Employers are now required to provide an employee or job applicant “an opportunity to present a legitimate medical explanation for the positive test result” and employers must “provide written notice of the right to explain to the employee or job applicant.” The employee or job applicant then has three working days after receiving notice to either provide an explanation or “request a confirmatory retest of the original sample at the employee’s or job applicant’s own expense.” As part of the employee’s or job applicant’s explanation she/he may “present an authorization for medical cannabis issued by a health care practitioner, proof of registration with the commission, or both.” To learn more about the Amendments, we recommend you consult with one of Anselmi & Carvelli’s Cannabis Law, Employment Counseling and Employment Litigation attorneys and review our article: Sifting Through the Smoke: New Jersey Employers Now Face Job Protections for Employees using Medical Marijuana.

We encourage businesses and human resource professionals to familiarize themselves with this case, review their drug free workplace and drug testing policies, and training materials. If you need assistance in evaluating your compliance with the Compassionate Use Act and its amendments, the Cannabis Law, Employment Counseling and Employment Litigation attorneys at Anselmi & Carvelli can assist you with drafting/revising policies, training, and your litigation needs.