TWO NEW JERSEY COURT RULINGS ON MARIJUANA USE THAT AFFECT YOUR WORKPLACE 

By Stephen E. Trimboli, Esq. Trimboli & Prusinowski, LLC 

NJ SUPREME COURT SUMMARILY AFFIRMS DECISION ALLOWING MEDICAL MARIJUANA USER TO PROCEED ON A WORKPLACE DISCRIMINATION CLAIM 

On March 10, 2020, in a brief decision, the New Jersey Supreme Court summarily affirmed the decision of the Superior Court, Appellate Division, in Justin Wild v. Carriage Funeral Holdings, Inc.

Wild involved a funeral director who had been diagnosed with cancer and prescribed marijuana under New Jersey’s original Compassionate Use Medical Marijuana Act, prior to its 2019 amendment.  His employer allegedly learned of the employee’s use of medical marijuana after the employee was injured in an automobile accident. (The employee alleged that marijuana played no role in the accident).  The employee was terminated shortly thereafter.  The employee claimed he was first told that his employer had been unable to “handle” his marijuana use and that his employment was being terminated “because they found drugs in [his] system.”  The employee alleged that no positive drug test result had ever been produced or reported to his employer and that he was later told that he had been terminated because he failed to disclose his use of medication that could impair his ability to perform his job duties.

PDFNJ will be hosting a FREE webinar on April 14, 2020 at 11am about medical marijuana in the workplace and Steve Trimboli, Esq., the author of this update, will be participating.  This webinar is open to any NJ business, so we strongly encourage you to share this information with business associates. If you have any questions, please contact Bill Lillis, Drug-Free Workplace coordinator, at bill@drugfreenj.org or 862-253-6808.

           The employee sued his former employer for disability discrimination under the New Jersey Law Against Discrimination. The employer moved to dismiss the suit based on N.J.S.A. 24:6I-14, which then stated that nothing in the Compassionate Use Act would “require… an employer to accommodate the medical use of marijuana in any workplace.”  Although the trial court agreed with the employer, the Appellate Division reversed the trial court’s decision.  The allegations of the employee’s complaint did not suggest that he had been using marijuana for medical purposes in the workplace.  The employee instead alleged that his marijuana use was entirely off duty, and he was therefore permitted to argue that his termination based on his alleged purely off duty use of marijuana constituted an act of disability discrimination.  This argument was sufficient to allow the employee’s claim to proceed.

The Supreme Court wrote a very brief decision adopting the Appellate Division ruling. However, the Supreme Court warned that the case is merely at the initial pleading stage, and all that had been decided was that the employee’s Law Against Discrimination complaint would survive a motion to dismiss. The Supreme Court also warned that the prohibition against accommodating the use of marijuana in the workplace, and the prohibition against using marijuana while driving vehicles or operating machinery, would be relevant to the final outcome of the lawsuit, rejecting the Appellate Division’s suggestion to the contrary. The Supreme Court thus declined “to adopt the Appellate Division’s view that ‘the Compassionate Use Act intended to cause no impact on existing employment rights.’ ”

           During oral argument, the Justices seemed divided over the meaning of the prohibition against accommodating the “use” of marijuana in the workplace. Some Justices seemed to think that this prohibition barred only the accommodation of the actual use of marijuana while at work. Other Justices suggested that the clause prohibited accommodations for marijuana use in the workplace, regardless where the marijuana was actually used. However, the Court’s opinion does not resolve this issue.

            The prohibition against accommodating the use of marijuana in the workplace was revised last year when the Jack Honig Compassionate Use Medical Cannabis Act was enacted. Wild is therefore most relevant to cases that arose before the Honig Act became law. Nonetheless, the Wild decision will continue to have an impact.

Under the new Honig Act, there is no absolute prohibition against taking adverse action against an employee who tests positive for marijuana under an employer’s drug testing policy. (Employers are prohibited, however, from taking adverse employment action against an employee solely because the employee is registered to use medical marijuana).   But an employee who tests positive for marijuana needs to be provided with written notice allowing the employee three working days to offer a legitimate medical explanation for the positive test result or to request a re-test. The employee may produce evidence of authorization for the use of medical marijuana as a form of legitimate medical explanation.

The Honig Act allows employers to prohibit the possession or use of marijuana during work hours and on workplace premises outside of work hours.

 The Honig Act does not tell the employer what it can or cannot do if the employee presents a legitimate medical explanation, or what it can or cannot do if the employee fails to present a legitimate medical explanation. Wild suggests that an employer confronted with a legitimate medical explanation for marijuana use needs to engage in the same reasonable accommodation/undue burden analysis applied to any employee using prescription medication generally. Such an analysis would include: how and when marijuana is being used; the employee’s job duties and the impact on health and safety if the employee is impaired; and, whether the employee’s use of marijuana would violate federal law, would cause the employer to lose a federal contract or funding, or would cause the employer to lose a licensing-related benefit pursuant to federal law. The prohibitions against possession or use of marijuana during work hours, on workplace premises, and while driving vehicles and operating machinery will remain relevant factors for consideration. On the other hand, as the law currently stands, an employee who fails to offer a legitimate medical explanation for the positive test result can be subjected to corrective action, including termination. Employers face a brave new world that is constantly evolving with respect to marijuana. 

WORKERS’ COMPENSATION CARRIERS CAN BE REQUIRED TO REIMBURSE MEDICAL MARIJUANA COSTS IN NEW JERSEY

On January 13, 2020, the Superior Court of New Jersey, Appellate Division, issued its decision in Hager v. M&K Construction. The Court held that workers compensation carriers are required to reimburse employees for the costs of purchasing medical marijuana in New Jersey. The Court specifically rejected the argument that the federal Controlled Substances Act (CSA), which criminalizes the manufacture, possession and distribution of marijuana, preempts New Jersey’s medical marijuana laws. The Court also rejected the argument that New Jersey’s medical marijuana laws unlawfully require the employer to aid and abet the employee’s possession of an illegal substance. Finally, the Court held that workers’ compensation carriers are not “private health insurers,” and therefore can be required to reimburse medical marijuana costs. Hager is a published decision and will therefore constitute binding precedent in New Jersey unless it is reversed by the State Supreme Court or repealed by statute.

The case arose from a workplace injury on a construction site that occurred in 2001, when the employee in question was 28 years old. It was not until November 2016 that the employer finally conceded that the employee had suffered a compensable work-related injury. In the interim, the employee suffered from continuous lower back pain. Medical treatment was unable to alleviate his pain. He was also prescribed various opioid medications for pain relief, without success. By November 2015, his treating physician had determined that the long-term use of opioid medications had “most likely caused” the employee to become both excessively sensitive to pain and opioid dependent. Finally, in 2016, the employee began treatment with a physician who prescribed medical marijuana.  The employee experienced relief from his otherwise incessant pain, began to sleep better, and was able to cease using opioid medications. He also reported that medical marijuana relieved his muscle spasms. The employee therefore continued his medical marijuana treatment at the prescribed level of two ounces per month, at a monthly cost of $616 that the employee paid out of his own pocket. His treating physician opined that the employee would need to continue this medication for the rest of his life.

The employee simultaneously sought workers’ compensation benefits from his employer, and a workers’ compensation trial began in November 2016. The parties were able to reach settlement on all but two issues. One of those issues was liability for the costs of the medical marijuana treatment. On July 26, 2018, the workers’ compensation judge issued a written decision ordering the employer to reimburse the employee for the cost of medical marijuana and any related expenses. The employer appealed this aspect of the decision. On appeal, the employer argued that New Jersey’s medical marijuana laws were preempted by the federal CSA. The employer relied on the theory of “conflict preemption,” which arises “when it is impossible for a private party to comply with both state and federal requirements, or where state law ‘stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.’” English v. Gen. Elec. Co., 496 U.S. 72, 79 (1990). The Hager Court focused solely on the first prong of the “conflict exemption” standard and asked whether “it is physically impossible for an employer to comply with both the CSA and [New Jersey’s medical marijuana laws].” The Hager Court found that no such conflict existed. The CSA prohibits the possession, manufacture and distribution of marijuana. “But an employer’s reimbursement of a registered [medical marijuana] patient’s use of medical marijuana does not require the employer to commit those offenses.” Because state law “does not require an employer to possess, manufacture or distribute marijuana … it is not physically impossible to comply with the CSA and the [New Jersey medical marijuana laws].” Therefore, according to the Hager Court, there is no “positive conflict” between these laws. The employer then argued that reimbursing the cost of medical marijuana could be considered “aiding and abetting” the employee in a commission of crimes prohibited by the CSA. The Hager Court rejected that argument as well. The employer “is not an active participant in the commission of a crime. The employer would be complying with an order requiring it to reimburse a person for the legal use of medical marijuana under this state’s law. [The employer] has not established the requisite intent and active participation necessary for an aiding and abetting charge.” Further, because “one cannot aid and abet a completed crime,” reimbursing an employee for medical marijuana the employee had obtained before seeking reimbursement would not constitute aiding and abetting because the “crime” in question had already been completed. Unfortunately, the Hager Court cited no federal case law precedent for its reasoning, leaving open the very real possibility that a federal court would decide the matter differently. State court decisions interpreting federal law have no binding effect whatsoever on federal courts.

The Hager Court was perhaps on more solid ground when it pointed out that the federal government had demonstrated a willingness to tolerate state medical marijuana laws. “The case for federal preemption is particularly weak where Congress has indicated its awareness of the operation of state law in a field of federal interest, and has nonetheless decided to ‘stand by both concepts and to tolerate whatever tension there is between them,’” citing Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 166-67 (1989). The Hager Court cited “evidence of toleration from the federal government of state-legislated medical marijuana,” including congressional appropriation riders adopted annually since December 2014 that prohibit the Department of Justice from using federal funds to interfere with state medical marijuana programs. Further, the employer “could not apprise this court of any federal prosecution against an employer or insurance carrier for its reimbursement of authorized medical marijuana treatment … a speculative argument cannot support a finding of conflict preemption.” For these reasons, the employer’s federal preemption argument failed. The Hager Court also addressed a critical statutory interpretation issue. N.J.S.A. 24:6I-14 states that “a government medical assistance program or private health insurer” cannot be required “to reimburse a person for costs associated with a medical use of cannabis.” The employer argued that its workers’ compensation carrier constituted a “private health insurer” under this statute. The Hager Court turned to the definition of “health insurance” contained in New Jersey’s Life and Health Insurance Code, N.J.S.A. 17B:17-1, et seq. The definition of “health insurance” under that Code specifically excludes workers’ compensation coverages. N.J.S.A. 17B:17-4. Based on this definition of “health insurance,” the Hager Court concluded that the term, “private health insurer” contained in N.J.S.A. 24:6I-14 does not include workers’ compensation carriers. Thus, in contrast to health insurance providers, workers’ compensation carriers can be required to reimburse the cost of medical marijuana. This aspect of the Hager decision creates a puzzling dichotomy. Employers still are not required to reimburse the cost of medical marijuana through the general health insurance coverages they offer employees, but now are required to reimburse those costs in a case of work-related injuries. It is not clear why the legislature would have intended such a curious dichotomy. Nonetheless, Hager is the only case law precedent directly addressing this issue, and will be controlling in the state unless the case is reversed on further appeal or overruled through subsequent legislation.

Based on Hager, New Jersey employers can now expect to be directed in work-related injury cases to reimburse employees for the cost of medical marijuana through their workers’ compensation carriers if medical marijuana treatment is otherwise deemed appropriate. At the end of the day, the Hager decision represents further movement in the direction of increased tolerance of marijuana, but it also reflects the lingering dangers facing employers (as well as medical marijuana users) in light of the continuing federal criminalization of marijuana use for any purpose, including purported medical purposes. Concerns such as those raised by the employer in Hager will persist until federal and state laws are harmonized. 

About the Author: Stephen E. Trimboli, Esq. Trimboli & Prusinowski, LLC, has been recognized as a Best Lawyer in the area of Employment Law, a New Jersey Super Lawyer, and an Employment Law Super Lawyer. He has received awards from the New Jersey Association of Counties; the National Public Employer Labor Relations Association, and the National Council on Alcoholism and Drug Dependence. He was the recipient of the 2019 PDFNJ Founder’s Award for the dedication and leadership he has given to the New Jersey business community in the work needed to maintain a healthy and safe workplace environment.   

Notice: This article reflects the opinion of the author and does not necessarily reflect the opinion of the Partnership for a Drug-Free New Jersey (PDFNJ). This information should not be construed as legal advice from the author or PDFNJ. Please consult your own attorney before making any legal decisions.

The Partnership for a Drug-Free New Jersey (PDFNJ) is a private 501 (c) (3) not-for profit organization that promotes the prevention of substance abuse throughout the state through media campaigns, school based programs and community and workplace initiatives. PDFNJ programs are made possibly by support from the Governor’s Council on Alcoholism and Drug Abuse, the New Jersey Department of Human Services, and funding from corporations and foundations. All programs and services provided by PDFNJ are free of charge. For more information visit www.drugfreenj.org or call 973 467-2100.

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