Marijuana in Arizona: Implications for Employers

Marijuana is again front and center in Arizona. On Election Day, Arizona voters legalized marijuana. Additionally, a recent U.S. District Court of Arizona decision may change how employers handle workers who are medical marijuana cardholders. Here’s what employers need to know.

The Smart and Safe Arizona Act (Proposition 207)

Arizona voters passed Proposition 207, nicknamed the “pot prop,” on November 3, 2020. Prop. 207 legalizes limited possession and use of marijuana for adults 21 years or older and permits individuals to grow up to six marijuana plants in their residences. The law will go into effect on or before April 2021 after the state has issued the required licenses for recreational dispensaries.

From an employment standpoint, what is interesting about Prop. 207 is that it provides no employment protections. The Arizona Medical Marijuana Act (AMMA) prohibits employers from discriminating against valid AMMA card holders. Prop 207, however, does not provide similar protections for recreational users. Thus, employers in Arizona can take adverse action (e.g., not hiring, disciplining, discharging) against recreational marijuana users who test positive for marijuana components or metabolites if they are not AMMA card holders.

The Safety-Sensitive Position Exception to the AMMA

A recent, tentative ruling in the U.S. District Court in Arizona on October 6, 2020, strongly suggests that the courts are likely to strike down the “safety-sensitive position” exception to the AMMA. (The ruling was tentative because before the court finalized its ruling, the parties settled the case.)

Background: In 2010, voters approved the ballot initiative that was the AMMA. In 2011, the Arizona Legislature enacted the Drug Testing of Employees Act (DTEA), which created the “safety-sensitive position” exception to the AMMA. Under this exception, an employer may prohibit medical marijuana cardholders from holding certain positions. In its October 6, 30-page decision, the federal court tentatively ruled that the DTEA’s creation of the “safety-sensitive position” exception was unconstitutional because it violated the Arizona Constitution as amended by the Voter Protection Act (VPA). The VPA restricts the legislature’s authority to repeal or modify laws enacted by voters.

Impaired employees are not protected: Although the validity of the “safety-sensitive position” exception is under attack and, possibly, may be short-lived, employers still may impose discipline against an AMMA cardholder based on the employer’s good-faith belief that an employee was impaired while working on the employer’s premises or during hours of employment. This is a result of Whitmire v. Wal-Mart Stores Inc., 359 F. Supp. 3d 761 (D. Ariz. 2019). Whitmire declined to address the constitutionality of the “safety-sensitive position” exception because that was not at issue in the case.

While no final ruling or reported case has confirmed the unconstitutionality of the “safety-sensitive position” exception, employers would be wise to begin reviewing their marijuana related policies, practices, and job descriptions that implicate the “safety-sensitive position” exception. Employers also should limit disciplinary action to those situations where they can document actual impairment while on the employer’s premises or during hours of employment.

The Arizona Labor and Employment attorneys at Ballard Spahr are experienced in handling Arizona marijuana law issues.

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This alert is a periodic publication of Ballard Spahr LLP and is intended to notify recipients of new developments in the law. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.