Seyfarth Synopsis: Illinois Governor J.B. Pritzker signed the new recreational cannabis bill, which contains extensive provisions regarding the extent of an employer’s right to ban and otherwise discipline employees for cannabis use. The legislation takes effect on Jan. 1, 2020.

Across the country, states are moving to legalize medical and recreational cannabis. In states that have legalized recreational cannabis, 11 so far, employers and drug testing services have seen significant increases in positivity rates for cannabis metabolites. Wider cannabis use will require employers to take action to ensure safe work environments for their employees, especially in safety sensitive settings. Drug policies must be updated and must address discrimination concerns. To that end, we are closely monitoring new forms of discrimination claims from medical cannabis users and regarded-as disabled employees. See our recent blog concerning a related Arizona court decision.

Illinois’ Cannabis Regulation and Tax Act

The Act provides that effective January 1, 2020, Illinois residents 21 years of age or older may legally possess up to 30 grams of cannabis flower, no more than 500 milligrams of THC contained in cannabis-infused products, and 5 grams of cannabis concentrate. They also will be able to make cannabis purchases from licensed cannabis dispensaries. Non-Illinois residents will be able to possess 15 grams of cannabis flower, no more than 250 milligrams of THC in cannabis-infused product, and 2.5 grams of cannabis concentrate.

The Act also provides an excise tax imposed on purchasers for the privilege of using cannabis. The rate of the excise tax is either 10%, 20% or 25% of the purchase price, depending on whether the sale is for a “cannabis-infused product” and the level of delta-9-tetrahydrocannabinol (THC) (i.e., strength).

The Act’s Employment Provisions

Relevant to employers is Section 10-50, which states that the Act is not to be construed as prohibiting an employer from “adopting reasonable zero tolerance or drug free workplace policies, or employment policies concerning drug testing, smoking, consumption, storage, or use of cannabis in the workplace or while on call provided that the policy is applied in a nondiscriminatory manner.” The Act does not require employers to permit an employee to be under the influence of or use cannabis in the employer’s workplace or while performing the employee’s job duties or while on call. Employers also retain the right to discipline an employee or terminate their employment if they violate the employer’s employment policies or workplace drug policy. While the Act defines the term “workplace” to include the “employer’s premises” (any building, real property, and parking area under the control of the employer or area used by an employee while in performance of the employee’s job duties, and vehicles (leased, rented or owned)), it goes on to state that “workplace” may be further defined by the employer’s policy so long as the policy is consistent with the Act.

The Act provides guidance to employers in determining whether an employee is impaired or under the influence while working. Specifically, an employer can meet this showing if it has a good faith belief that an employee manifests specific, articulable symptoms while working that decrease or lessen the employee’s performance of their job including:

  • Symptoms of the employee’s speech, physical dexterity, agility, coordination, demeanor, irrational or unusual behavior, or negligence or carelessness in operating equipment or machinery;
  • Disregard for the safety of the employee or others, or involvement in any accident that results in serious damage to equipment or property;
  • Disruption of a production or manufacturing process; or
  • Carelessness that results in any injury to the employee or others.

The list is non-exhaustive, which leaves room for an employer to rely on other indicia of impairment.

If an employer disciplines or terminates an employee because they are under the influence or impaired by cannabis, the employer must provide the employee a reasonable opportunity to contest the basis of the determination. The Act says nothing about whether an employer can rely solely on a positive test result for cannabis to show an employee was impaired or under the influence. As we know, given that cannabis can remain in the system for a few weeks, a positive test result does not necessarily mean an employee is under the influence or impaired. Further, the exact parameters of what employers will have to do to provide a reasonable opportunity to contest the basis remains undefined.

No Private Right of Action

The Act expressly states that employees do not have a private right of action against an employer for:

  • subjecting an employee or applicant to reasonable drug and alcohol testing under the employer’s workplace drug policy, including an employee’s refusal to be tested or to cooperate in testing procedures;
  • disciplining the employee or terminating employment, based on the employer’s good faith belief that an employee used, possessed, was impaired by or was under the influence of cannabis in violation of the employer’s workplace policies while in the employer’s workplace, performing the employee’s job duties or while on call; and
  • injury, loss or liability to a third party if the employer neither knew nor had reason to know that an employee was impaired

Implication for Employers

Although the Act states that “cannabis should be regulated in a manner similar to alcohol,” this is easier said than done. Cannabis, unlike alcohol, is still illegal under federal law and signs of cannabis impairment are not as easily detectable as alcohol impairment. Moreover, it also is easier to prove alcohol impairment with an alcohol test. The same cannot be said for a drug test given that cannabis can remain in the system for several weeks.

Employers should also bear in mind that the Act designates recreational cannabis used in compliance with the Act as a “lawful product” subject to the protections against discrimination provided under the Illinois Right to Privacy in the Workplace Act. This means that an employee who lawfully uses cannabis outside of work and is not impaired or under the influence of cannabis during working hours (while on duty or while “on call”) will generally not be subject to adverse employment action. But because cannabis remains an illegal controlled substance under federal law, employers in Illinois are put in a difficult situation. Fortunately, the Act does not require employers who must comply with applicable federal rules and regulations to become non-compliant. It is therefore likely the Act will be interpreted to allow employers to continue to maintain employment policies prohibiting any cannabis use where necessary to comply with applicable federal law but it is not certain whether such policies would result in a violation of the Illinois Right to Privacy in the Workplace Act.

For employers, cannabis legalization will mean necessarily re-assessing company policies, especially as they relate to drug testing, and the use of recreational cannabis by key security personnel and sensitive positions within the company. Employers should be vigilant in documenting all signs and evidence of impairment. At the end of the day, employers will have to walk a fine line of balancing their drug policy objectives against applying that policy in a nondiscriminatory manner. Further, employers may need to revise their policies to give employees an opportunity to contest impairment determinations.