HIGHLIGHTS:

  • The Colorado Supreme Court upheld the termination of a quadriplegic Dish Network employee who was a licensed medical marijuana user under Colorado’s medical marijuana rules.  
  • The Court denied a wrongful termination claim because the employee’s use of medical marijuana was prohibited by federal law and, consequently, the employee was not terminated for engaging in a “lawful activity” protected by Colorado law.
  • Caution still should be exercised by employers outside of Colorado before discharging an employee for his or her lawful use – under state law – of marijuana.

In Coats v. Dish Network, the Colorado Supreme Court held that the state’s “lawful activities” statute did not limit the right of an employer to discharge an employee for the employee’s lawful (under Colorado law) use of marijuana for medical purposes.

Colorado Supreme Court Decision Relies on Federal Law to Uphold Discharge

Brandon Coats brought a claim against Dish Network alleging that he was wrongfully terminated for his lawful, off-duty use of marijuana. Coats relied on a Colorado statute that prohibits employers from discharging an employee because that employee engaged in a “lawful activity off the premises of the employer during nonworking hours.”1 Although Colorado law permitted Coats to use marijuana, the federal Controlled Substances Act prohibited the possession of marijuana.2 Before the Colorado Supreme Court, Coats conceded that his use of medical marijuana was prohibited by federal law.

Because federal law prohibited Coats’ use of medical marijuana, the state Supreme Court concluded that Dish Network had not terminated him for engaging in a “lawful” off-duty activity. The Court held that the term “lawful” in the statute was not limited to Colorado state law, and refused to graft that requirement onto the statute’s language. Accordingly, because his use of medical marijuana was unlawful under federal law, the statute did not apply.

Implications for Other States

The Colorado Supreme Court’s Coats decision suggests that “lawful activity” statutes in other states will permit discharge or other adverse employment actions where an employee engages in the lawful (under state law) use of marijuana, because this “activity” remains prohibited by federal law. As of June 2015, 23 states and the District of Columbia permit the use of marijuana either for medical and, in four states, recreational purposes.3 Of those 23 states, California, Illinois, Minnesota, Montana, Nevada and New York, like Colorado, have laws protecting employees from adverse employment actions based on their off-duty lawful activities or off-duty use of lawful products. Courts in these states are not required to follow Coats and may rule that the discharge of an employee for the lawful use of marijuana violates that state’s “lawful activity” statute.

The extent of Coats’ impact on how those states with “lawful activity” statutes will deal with an employee’s off-duty lawful (state law) use of marijuana remains to be determined. It is important to note, however, that Colorado’s marijuana laws merely decriminalized (on the state level) the use of marijuana for medical or recreational purposes. In decriminalizing marijuana use, Colorado did not include any provisions expressly protecting employees from adverse employment actions tied to marijuana use.

To date, Arizona is the only state to have enacted statutory protections banning employers from discharging medical marijuana users absent an impairment from such use in the workplace. Illinois prohibits employers from taking an adverse employment action on the basis of medical marijuana user status; that is, an employer is prohibited from taking adverse action against an employee merely because the employee is authorized under Illinois law to use medical marijuana. Whether an Illinois employer may discharge an employee based on the employee’s actual lawful (state law) off-duty use of medical marijuana absent an impairment from such use in the workplace has yet to be ruled upon by a court.

Employers: Be Cautious Before Firing Employees for State Lawful Use of Marijuana

There is the beginning of a trend for courts to permit employers to discharge employees for the lawful (state law) off-duty use of marijuana. For example, courts in California,4 Michigan5 and Washington6 have upheld an employer’s right to discharge an employee for the off-duty use of medical marijuana in accordance with state law.

Coats signals that an employer retains the right to take adverse action against an employee who violates its drug-free workplace policies by using marijuana even if the employee’s use was not a criminal act under state law. But caution should be exercised by an employer outside of Colorado until the relevant state law and court decisions are reviewed to determine whether the employee is afforded any workplace protections for his or her lawful (under state law) off-duty use of marijuana. This is a developing area of the law and even in states where courts have preserved the right of the employer to discharge an employee for the use of marijuana in accordance with state law, it is possible that the courts will shift their positions in the future.