Cannabis in the Workplace

Understanding employee rights and employer obligations post-legalization
Although recreational marijuana has been legal in Canada since October 17, 2018, employers trying to stay on the right side of the law in their workplaces are finding there’s not only complexity, but also risk and a fair level of uncertainty. “The law, in terms of the workplace and recreational cannabis, is in its infancy, in a state of flux and has got to catch up with reality,” says Richard Charney, senior partner and Global Head of Employment and Labor at Norton Rose Fulbright LLP. 

 “We’re all in a bit of the new world in terms of regulating cannabis for non-medicinal purposes in the workplace,” agrees Mitch Frazer, senior partner and chair of the Pensions and Employment Practice at Torys LLP.  He says for employers figuring out how best to navigate and mitigate potential risks in their workplaces, it’s not an inconsequential matter.  

“Canada does have the fourth-highest cannabis consumption rate in the world, according to the United Nations Office on Drugs and Crime,” he says. And, further, he highlights the Canadian Tobacco, Alcohol and Drugs Survey (CTADS) conducted by Statistics Canada on behalf of Health Canada, which highlighted that in 2015, 24 percent of users consume cannabis for medical purposes, and 76 percent do so for recreational reasons. “So now that recreational cannabis is legal, it’s clear to see it’s a material and meaningful social and workplace issue.” 

One reason for the lack of clarity is that rules and regulations are not uniform across the country. “While the federal Cannabis Act legalized recreational cannabis,” says Stephen Shamie, a senior labor and employment lawyer in the Toronto office of Hicks Morley LLP and the firm’s managing partner. “Each province and territory has established its own statutory framework to deal with legalization, which, among other things, sets out the age at which an individual can buy, possess, use and grow recreational cannabis.” 

And, drilling down even further, adds Shamie, many municipalities across the country have also implemented regulations to address recreational cannabis and its sale or use. Some municipalities have passed by-laws to prevent the sale or use of cannabis, making each city distinct in its rules and regulations. Hence, there is “certainly no ‘one size fits all’ approach to recreational cannabis in Canada,” says Shamie, “and employers need to be aware of the requirements that may vary by jurisdiction.”

The law may be evolving, but potential risks – think human rights, accommodation, to name a few – need to be managed, but there are tools that may provide guidance, says Hendrik Nieuwland, a partner with Shields O’Donnell MacKillop LLP. “We’re not reaching around in the dark; employers can draw on what has been learned regarding accommodation, for example, in terms of alcohol and medicinal cannabis in the workplace.” 

He says employers in Canada have a duty to accommodate the medical use of cannabis. “However, we don’t have a duty to accommodate the recreational use of cannabis. The only circumstance where that doesn’t apply is if someone has an addiction to cannabis, much like if someone has an addiction to alcohol, then it becomes a disability which has to be accommodated.”

Cannabis addiction is considered a disability under most human rights legislation, and employer policies should ensure that policies cover potential addiction issues with procedures to appropriately respond to such concerns, says Norton Rose Fulbright’s Charney. 

“Yet just because an employee likes using recreational cannabis doesn’t make the person an addict, and also doesn’t mean that the employer or prospective employer is perceiving the employee is an addict. So it is quite fine for employers to express preferences against the use of that substance and it’s not a human rights violation,” he says. “Now in a unionized workforce, there is a complication though; and that’s because not only must the employer not violate human rights legislation, it must also implement rules that can stand up to scrutiny on the basis of reasonableness.” 

Where it gets interesting, he says, is where employers have attempted to create some rules around the use of cannabis when the employee is not at work. For example, “some police forces, in diverse parts of the country, have instituted restrictions ranging from officers not being able to use cannabis within a certain timeframe of coming on duty, to a complete ban on the right to use cannabis by officers who qualify to use firearms.” These rules, he says, are bound to be tested, at least in the case of police by arbitrators or human rights tribunals.

Although the line can sometimes be difficult to ascertain – and employers must show caution in terms of deciding whether or not an employee has a cannabis addiction – increasingly, Kathryn Bush is fielding questions from employers regarding benefit plans and cannabis in this new regime. “There is significant uncertainty as to the use and regulation of cannabis in the workplace,” says Bush, a partner in the Pension, Benefits and Executive Compensation Group with Blake, Cassels & Graydon LLP. “It will be important for employers to see how this develops in the next couple of years.”  

Even so, there is some case law in Canada surrounding benefits and medical cannabis of which employers must be aware, says Bush. “Benefit plans will not provide for recreational cannabis coverage, but even where cannabis has been prescribed there is case law, for example, Canadian Elevator Industry Welfare Trust Fund v. Skinner, 2018 NSCA 31, that benefit plans do not have to provide coverage for medical marijuana and is not discriminatory in Nova Scotia under the province’s human rights legislation.” 

In Ontario, says Shamie, the Ontario Human Rights Tribunal in Rivard v. Essex (County), 2018 HRTO 1535, found the decision to deny coverage for medicinal cannabis under an employer’s benefit plan was not discriminatory under the Ontario Human Rights Code when the denial is unrelated to an applicant’s disability or another protected ground.”

Another workplace and cannabis issue is determining how to measure impairment, says Nieuwland. A recent court decision in Newfoundland, he says, although it dealt with medically authorized marijuana use in a safety-sensitive workplace, has implications for employers seeking guidance as they create policies surrounding the use of recreational cannabis in their workplaces. 

“In that case, the International Brotherhood of Electrical Workers, Local 1620 v. Lower Churchill Transmission Construction Employers’ Association Inc., 2019 NLSC 48, the union challenged the company’s refusal to hire a person in a safety-sensitive position because he used medical cannabis. The company cited the fact that current cannabis testing technology could only show that a person used cannabis in the recent past, but could not tell if an employee was impaired by cannabis at work. Given this limitation, the employer concluded it could not hire this person because there was no way to know if he could work safely. The court agreed with the company.” 

Nieuwland says this decision reflects good policy. “If you can’t measure impairment, an employer can’t manage the risk. Until cannabis testing technology is able to measure impairment at work, like an alcohol breathalyzer, employers in Canada appear to have the right to refuse to employ cannabis users in safety-sensitive roles.” 

The bottom line for US counsel in understanding the implications for recreational cannabis and its use in the Canadian workplace is that it’s unclear. To minimize risks, employers need to ensure they review and update their employment policies so it’s clearly delineated in the employee handbook what is and what is not tolerated in regard to cannabis use, in their specific workplace, says Frazer. “If there are unionized employees, this discussion needs to take place with the union and union representatives and how this fits into the collective agreement.”

Most often, the policy will take into consideration both alcohol and cannabis, says Bush. There needs to be a statement that the employer is responsible for maintaining a safe and productive work environment for all employees. At the same time, Bush says, employees are required to perform their job safely and responsibly, and be “fit to work” when conducting work on behalf of the employer,” Bush says.

In addition, employees must conduct themselves in a professional manner and not engage in behavior that would have a negative impact on the employer’s brand or reputation. So, for example, the policy should also include off-site use of cannabis, she says, such as whether it can be used while at employer-sponsored events. Further, given that the law is evolving – the second wave of legalization, scheduled for 2019 will include, for example, cannabis edibles – the policy will need to be updated.

“Right now we’re using analogies to alcohol, that’s functionally what we’re doing,” says Frazer. “But cannabis is a different regime; it’s going to take several years to unfold and to have enough law that advisors can actually give reasonable certainty as to what’s going to occur.”