Risk & Business Magazine JGS Insurance Magazine Winter 2018 | Page 27

MARIJUANA AT WORK The Marijuana Issue At Work H ere in New Jersey there is much talk and “noise” about the coming recreational legalization of marijuana. If there is one thing that most people in the United States have learned over their lifetimes, it’s that you shouldn’t show up to work under the influence. Drug tests are a standard part of many job screenings, and positive results would traditionally rule out any possible drug users, including those who are partaking in marijuana. So what happens now that legalization of marijuana is expanding across the nation with New Jersey soon to follow? How will workplaces reconcile the current laws—some of which seem to be contradictory—with their traditional and standard policies on this issue? Whether it is stated directly or simply implied, most everyone understands that employers are responsible for individuals who are employed on their property and who are acting under their authority. Thus, employers have the right, should they so choose, to put drug policies in place. It is essential, however, that they have a documented cannabis policy that can mitigate some of the risks they might become exposed to due to the new laws and regulations. This isn’t done to exclude employees who use marijuana; it is done to protect the business from potential negative consequences of that use. Businesses are responsible, first and foremost, for the protection of their own interests, employee safety and customer safety. Cannabis use can impact your workers compensation experience mod as well as your third-party liability exposures. The flip side to this is that medical marijuana issues could potentially be argued as a health-and-safety issue for employees who have prescriptions. Right now, businesses are able to prohibit the use of alcohol during work hours. They can also prohibit employees from showing up to work under the influence of alcohol. In the same way, they can have firm and consistent zero-tolerance rules for marijuana. The difficulty here is a question of individual state regulations. Recently, on the umbrella liability policies that our company issues, we have started to see Cannabis Items and Activities Exclusions. We haven’t yet seen them for all states that allow both medical and recreational use, but it’s only a matter of time before we do. I suspect that some companies are currently relying on “other language” in their exclusions to restrict coverage: language such as use of controlled substances, contraband and criminal or illegal acts. The recent Cannabis exclusion I read specifically states the terms of this endorsement apply even if “cannabis activities” and the possession of “cannabis items” are legal or permissible under the law of the state in which the loss or damage occurs. With new rules coming into place every day, different laws in different states, and marijuana still illegal at the federal level, it is almost like walking through a minefield when determining what is and is not legal in terms of the use of marijuana and what will or won’t be defended under your insurance contracts. In California, for instance, a federal district court ruled that it doesn’t violate California workplace discrimination law to fire employees for marijuana use regardless of the reason they are using it (thus including medical use). That issue is compounded even further for companies that have federal contracts. Federal contractors must abide by the Federal Drug-Free Workplace Act which prohibits the use of marijuana. Employers who don’t follow this restriction can lose their ability to bid on and receive federal contracts. So what are employers to do? How can they navigate these issues and still maintain high employee retention rates and productivity? These questions are tough, but have to be answered in the wake of constantly changing regulations. For legal advice, I recommend that you contact your employment counsel now so that you have a plan in place once legalization is finalized. For additional insurance information, contact [email protected] for a consultation about what exclusions may apply and what your workplace can do regarding its marijuana policies to mitigate your risks. + Ken Hager began his insurance career more than 30 years ago at JGS Insurance. Ken’s current role as Chief Operating Officer at JGS began in 1997. Since that time he has been a guiding force in the direction and success of the JGS enterprise. Throughout the years, Ken has remained engaged with his customers and keenly focused on their needs. He intently understands the risks associated with his clients' operations and has been uniquely able to offer them superior solutions to their business needs. BY: KEN HAGER, AAI, CIRMS PRINCIPAL JGS INSURANCE 27