Colorado Supreme Court to Address Issues Related to Legal Medical Marijuana Use by Employees

Megan J. Muoio, September 11, 2014

In 2000, the State of Colorado legalized medical marijuana use by individuals with debilitating medical conditions. Then in January 2013, it attracted attention by legalizing recreational marijuana use, but it is the use of medical marijuana that has sparked an important employment law-related debate. For employers in New Jersey, where medical marijuana is already legal, and New York, where it is expected that medical marijuana will be legalized soon, Colorado is the first test for regulating employees’ medical use of marijuana outside of the workplace and employers’ zero-tolerance drug policies.

In 2010, Brandon Coats, a Colorado resident, was fired from his customer service job at Dish Network as a result of a drug test that was positive for THC, the active ingredient in marijuana. Coats, who suffered a spinal cord injury as a teenager and is a quadriplegic, was prescribed medical marijuana in 2009 to treat chronic, involuntary muscle spasms and seizures. Although Coats never used marijuana while on the job at Dish Network, THC remains in one’s system for weeks after use and can trigger a positive drug test. Dish Network has a zero-tolerance policy regarding drug use that read as follows: “No employee shall report to work or be at work with alcohol or with any detectable amount of prohibited drugs in the employee’s system. Any violation of this statement of policy will result in disciplinary action up to and including termination.”

After he was terminated, Coats sued Dish Network for wrongful termination under Colorado’s Lawful Activities statute, which prevents employers from terminating employees for legal activity outside of the workplace. Coats’ lawsuit was dismissed by the trial court on the basis that marijuana use, although legal for medical use under Colorado State law, is still illegal under federal drug laws and could not be considered “legal” under the statute. Federal law does not contain an exception for medical use of marijuana, although the federal government has not been prosecuting individuals who are possessing and using marijuana under state medical marijuana statutes. The Colorado Appellate Court confirmed the ruling of the trial court and the case was argued before the Colorado Supreme Court this summer. Dish Network’s position was bolstered by briefs from the Denver and Colorado chapters of the Chambers of Commerce and other business groups that supported Dish Network’s employment zero-tolerance drug policy and compliance with federal law.

Colorado’s medical marijuana law does not provide any guidance for employees looking for employment protection concomitant with their medical use of marijuana. In contrast, in Arizona, employers are prohibited from having zero-tolerance policies because the Arizona medical marijuana statute discrimination against employees for their out-of-work medical marijuana usage as long as the employee is not in a “safety sensitive” job. In Colorado, however, it is expected that federal law prohibiting the use of marijuana for any reason, even medical use sanctioned by the state, will trump Colorado’s medical marijuana law and that Dish Network’s decision to fire Coats will be upheld.

Absent a change in federal law regarding the medical use of marijuana, employers are within their rights to prohibit the use of marijuana for any reason by their employees and take action against those employees for violating company policy. Employers in states where marijuana is legal for medical purposes or in states where such laws may soon be enacted should review their employment policies regarding the use of drugs in and out of the workplace and ensure that their policies expressly address the company’s stance on drug use, even use for medicinal purposes. Specifically, employment policies should clearly state that the employer has the right to discipline and terminate employees as a result of drug tests and that drug use – in and out of the workplace – if detected, may be grounds for an adverse employment action. The policy should further clarify that it is not a defense for the use to be legal under state law and specifically address the issue of state-legalized medical marijuana.

The Supreme Court of Colorado is expected to rule on appeal in Coats v. Dish Network later this year.