Publication

Cannabis is legal for recreational use in California, though it remains an illegal substance under federal law. Numerous other states have enacted laws protecting off-duty use of recreational cannabis. This is because Tetrahydrocannabinol ("THC") is the chemical compound in cannabis that can indicate impairment and cause psychoactive effects in users. After THC is metabolized, meaning a period of time has passed since the user ingested cannabis, it is stored in the body as a non-psychoactive cannabis metabolite. These metabolites do not indicate impairment, only that an individual has consumed cannabis in the last few weeks. So, what does this mean for California employers?

Overview
Beginning January 1, 2024, California employers are prohibited from discriminating against employees because of:

1. The employee's use of cannabis off the job and away from the workplace and 
2. A drug screen that reveals non-psychoactive cannabis metabolites in the employee's hair, blood, urine, or other bodily fluids.

Who Is Not Covered by the Law?

1. Any employee in the building and construction trades; 
2. Applicants and/or employees whose positions require them to go through a federal background investigation or security clearance; or 
3. Applicants and/or employees who under state or federal laws must be tested for controlled substances as a condition of employment, receiving federal funding or federal licensing, or entering into a federal contract.

The law does not define the scope of the exemption for building and construction trades, and so we can expect to see some dispute over which employers qualify. 

Also, being a federal contractor subject to the federal Drug-Free Workplace Act, by itself, does not require drug testing and does not allow employers to regulate employees' off-duty use. This reality presents some unique challenges for federal contractors in California. 

While federal law preempts state employment law as a general rule, California employment law will govern where there are no conflicts. For example, some federal laws require testing for cannabis use, including Department of Transportation regulations for pilots, truck drivers, and other safety-sensitive transportation employees. Likewise, to the extent that the terms require testing of a federal contract, the new California legislation would be in conflict, so those specific provisions of the state law would be unenforceable (e.g., the federal law will preempt state law, and testing can continue).

What Does the Law Not Cover?

1. On-the-job impairment or possession: employees may be disciplined for being impaired on the job or possessing cannabis while at the workplace. 
2. Valid pre-employment drug testing: a drug test that reveals the candidate is positive for illegal drugs or psychoactive traces of THC (meaning evidence the employee was impaired during the test) can be grounds not to move forward with the hire.
3. Reasonable suspicion testing: employers may still conduct drug tests if they have reasonable suspicion an employee is impaired on the job; however, to take action against the employee, there must be psychoactive traces of TCH on the test result, meaning non-psychoactive traces are insufficient to warrant discipline or termination. 

Because of the potential for employee discrimination claims, this law needs to be followed precisely, we encourage employers to contact their trusted GRSM attorney for further guidance.

For multi-state employers, please see a previously published article entitled, "Dazed and Confused: What Multi-State Employers Need to Know About the Current Trend of California and Several Other States Prohibiting Discrimination of Off-Duty Cannabis Use."