The United States Court of Appeals for the Sixth Circuit ruled in Casias v. Wal-Mart Stores, that the Michigan Medical Marijuana Act ("MMMA") does not regulate private employment and, therefore, did not protect Joseph Casias, a Wal-Mart worker authorized to use marijuana for medical reasons, from being fired after he failed a drug test.

Employers and the courts continue to wrestle with issues involving whether employers must accommodate medical marijuana use by their employees. On one hand, marijuana use is illegal under the federal Controlled Substances Act ("CSA") and, therefore, does not need to be accommodated under the federal Americans with Disabilities Act ("ADA"). However, 17 states currently have legalized some form or another of medical marijuana use: Alaska (1998), Arizona (2010), California (1996), Colorado (2000), Connecticut (2012), Delaware (2011), Hawaii (2000), Maine (1999), Michigan (2008), Montana (2004), Nevada (2000), New Jersey (2010), New Mexico (2007), Oregon (1998), Rhode Island (2006), Vermont (2004), Washington (1998) as well as the District of Columbia (2010). The language of each state's law can differ, and the courts therefore interpret these state law issues on a case-by-case basis. The Michigan statute is the most recent one to come under judicial review. Here, is the background of that case and how the Sixth Circuit came to the conclusion it did.

In 2008, Michigan voters enacted the MMMA by referendum to provide protection for the medical use of marijuana. It allows only a “qualifying patient” or a “primary caregiver” to whom the state has issued a registry card to use or administer medical marijuana and prohibits, in part, “disciplinary action by a business or occupational or professional licensing board or bureau” against a person to whom the state has issued a registry card for the use or administration of medical marijuana. The key word in the statute for purposes of the Casias case is "business" and here's why.

Casias started working at Wal-Mart in 2004 as an inventory control manager. He was later diagnosed with sinus cancer and an inoperable brain tumor. Due to his ongoing head and neck pain, he received a medical marijuana registry card and began using marijuana to manage his pain in the summer of 2009. Later that same year, Casias injured his knee at work, went to the hospital and was subjected to a standard drug test pursuant to Wal-Mart's policy. Prior to the test, Casias showed his card to the testing staff. Well, as you probably guessed, Casias tested positive for marijuana. He showed his shift manager his registry card, and informed his manager that he never consumed marijuana while at work or came to work high. Nevertheless, Casias was fired for failing his drug test.

Casias sued Wal-Mart for wrongful discharge for violating the MMMA. The U.S. District Court for the Western District of Michigan dismissed Casias' lawsuit finding that the word “business” in the statute does not regulate private employment actions and that the MMMA "contains no language stating that it repeals the general rule of at-will employment in Michigan or that it otherwise limits the range of allowable private decisions by Michigan businesses."

The Sixth Circuit agreed and held that the MMMA prohibits “disciplinary action by a business or occupational or professional licensing board or bureau” against a “qualifying patient.” Focusing on the key term "business," Casias argued that although the MMMA does not expressly refer to employment, the term “business," as used in the MMMA, was independent and expanded the MMMA's protections to private employers. In other words, Casias argued that Wal-Mart was a "business" and thus fell within the MMMA prohibitions which precluded “disciplinary action by a business or occupational or professional licensing board or bureau” against a person with a medical marijuana registry card.

Wal-Mart countered, arguing that the term "business" modified the phrase “licensing board or bureau,” and that it did not extend the MMMA's protections.

The Sixth Circuit agreed with Wal-Mart and expressly rejected Casias' proposed interpretation of the MMMA, which the Court found could prevent any employer in the state from disciplining a qualified patient who uses marijuana under the MMMA. The Sixth Circuit, siding with Wal-Mart, opted not to read the term “business” independently. Rather, it concluded that the word “business,” as used in the MMMA, modified the phrase “licensing board or bureau,” and that the MMMA “is simply asserting that a ‘qualifying patient’ is not to be penalized or disciplined by a ‘business or occupational or professional licensing board or bureau’ for his medical use of marijuana.” Therefore, because the term "business" merely described or qualified the type of “licensing board or bureau"; it did not refer to employment:

Based on a plain reading of the statute, the term "business" is not a stand-alone term as Plaintiff alleges, but rather the word "business" describes or qualifies the type of 'licensing board or bureau" .... "Read in context, and taking into consideration the natural placement of words and phrases in relation to one another, and the proximity of the words used to describe the kind of licensing board or bureau referred to by the statute, it is clear that the statute uses the word 'business' to refer to a 'business' licensing board or bureau, just as it refers to an 'occupational' or 'professional' licensing board or bureau. 

The Court further explained that adopting Casias' argument would create an entirely new protected employee class in Michigan and "mark a radical departure from the general rule of at-will employment in Michigan." Because the case was one involving statutory interpretation, the Court highlighted the importance of carefully crafting groundbreaking legislation like the MMMA, and held that the MMMA does not govern private employment actions. The Court went one and noted that other states including California, Montana, and Washington had also held that their states' similar medical marijuana laws do not govern private employment actions.

The Court noted the limited application of the MMMA that merely provides a defense to criminal prosecution or other adverse actions by the state: "All the MMMA does is give some people limited protection from prosecution by the state, or from other adverse state action in carefully limited medical marijuana situations."

The Takeaways

The Sixth Circuit governs Kentucky, Michigan, Ohio and Tennessee. Of these four states, only Michigan currently allows for medical marijuana. This is not to say that the other states have not tried and/or are not trying to move the issue forward.

For example, Ohio has had two recent initiatives legalize medical marijuana — the Ohio Medical Cannabis Act, and the Ohio Alternative Treatment Amendment. Neither one, however, made it in on the November 2012 ballot because neither received the necessary 385,000 signatures required by the July 19, 2012 deadline.

As for Tennessee, the Tennessee’s House Health and Human Resources committee recently approved a bill that prompts the state’s Board of Pharmacy to conduct research proving that residents of Tennessee with debilitating conditions could benefit from a prescription for cannabis. If passed by Tennessee’s government, the law allowing the research of marijuana would begin this fall and report their findings back late next year. This could mean that medical marijuana in Tennessee is closer to becoming a reality.

Kentucky has been the slowest of the four to get aboard the cannabis train, but this year. Louisville Senator Perry Clark introduced SB 129, which proposed rescheduling marijuana under state law and would have allowed doctors to prescribe it to patients with debilitating illnesses without fear of arrest. While the bill never received a hearing and did not pass this year, it did receive a lot of media attention and will likely continue to be an issue.

While more and more states are leaning toward authorizing and/or decriminalizing the use of medical marijuana, most of their “approval” has not been extended into private employment regulation. Consequently, in these states, an individual who uses marijuana may be protected from criminal prosecution, but his or her employment will not similarly be protected.

The Sixth Circuit’s decision, which is consistent with rulings in other states with similar medical marijuana laws, supports a private employer's decision to refuse to accommodate an employee's use of medical marijuana and to continue to enforce its polices prohibiting the use of medical marijuana in the workplace. Thus, Michigan employers should have a better sense of comfort if they choose to discipline or discharge employees who test positive for marijuana but who offer medical marijuana registration cards as excuses. Although the Casias decision does not answer all questions regarding medical marijuana in the workplace, e.g., it does not indicate what would happen in the public employer context, or break down all legal hurdles to disciplining employees, it did answer one important question that has festered since the law’s enactment.

As far as some helpful tips for employers, here are a few:

  1. In each state where you have operations, determine what each state law provides for regarding medical marijuana. Employers should stay apprised of their state laws on the issue, especially as they pertain to drug testing and accommodating the use of medical marijuana in the workplace. For example, while most states' laws on medical marijuana have been interpreted not to require employers to accommodate an employee's use in the workplace, Connecticut's law, An Act Concerning the Palliative Use of Marijuana, which became effective this week on October 1, 2012, goes further than most similar laws and expressly forbids employers from refusing to hire, discharging, penalizing, or threatening individuals based on their medical marijuana use. However, it also provides that employers may prohibit the use of intoxicating substances during work hours and may discipline employees for being under the influence of intoxicating substances during work hours. While no court has interpreted this law yet, it is likely that it will differ from the holdings interpreting the California, Michigan, Montana, Oregon and Washington laws on medical marijuana, and will more in line with what the courts in Maine and Rhode Island, who have statutes prohibiting adverse employment action on the basis of medical marijuana, have to say on the issue.
  2. For all employers, regardless of state law, review your policies to make sure that illegal drug use under both state and federal law is prohibited, and that your policies prohibit any detectable amount of illegal drugs, including medical marijuana if allowed by state statute, in an applicant's or employee's system ? as opposed to using an "under the influence" standard. This includes providing clear information about your position on drug and alcohol testing. In addition:
  • Notify applicants in writing of your medical marijuana policy at the time of application and notify current employees of your policy on medical marijuana; and
  • Ensure that your human resource employees are trained and know how to respond to medical marijuana issues as they arise.