Add M&C blogs to this category

Medical Marijuana and the Workplace

/in

Murchison & Cumming Blog: Post 85

View Link

Dazed and Confused: How Upcoming Ballot Measures and Cases of Interest Continue to Change the Legal Landscape around Marijuana

California’s Compassionate Use Act (CUA) of 1996 decriminalized the use of marijuana for medicinal purposes. However, it did not legalize marijuana. It only shields medical users and caregivers from criminal liability. Recently, Governor Brown signed into law three bills (Assembly Bill 266, Assembly Bill 243, and Senate Bill 643) that comprise the California Medical Marijuana Regulation and Safety Act (MMRSA). While the MMRSA deals with various medical marijuana regulations, it does nothing to impede an employer’s right to maintain a drug free workplace.

At this point, there is no federal or state law prohibiting employers from disciplining or terminating employees for the use of medical marijuana, even when used to treat a disability. In 2008, the California Supreme Court stated, in Ross v. RagingWire Telecommunications, Inc., that the CUA did not address employment rights and duties so an employee fired for his use of medical marijuana could not sue his former employer for disability discrimination or wrongful termination.

Under federal law, the Americans with Disabilities Act (ADA) generally requires that employers provide a reasonable accommodation to a “qualified individual with a disability” (except under undue hardship). However, the ADA does not protect individuals who are using marijuana for medical purposes, even when such use is lawful under state law. Under the ADA, illegal drug use does NOT include use of drugs “taken under supervision by a licensed health care professional, or other uses authorized by the Controlled Substances Act or other provision of Federal law.” Medical marijuana remains illegal under the federal Controlled Substances Act and the ADA specifically precludes any employee or applicant who is engaging in the illegal use of drugs from being considered a qualified individual with a disability.

But, California will have an initiative on the November 2016 ballot for full legalization of marijuana. All indications thus far appear that the initiative will likely pass. Regardless of whether the measure passes or not, the landscape continues to change and it is only a matter of time before the issue of accommodations is re-visited.

Where does that leave employers and how can you prepare?

While California employers cannot refuse to hire or fire individuals based on their usage of medical marijuana, they can require employees to pass a drug test as a pre-employment condition provided all applicants are tested. More importantly, employers can still prohibit employees from possessing or being under the influence of cannabis while at work.

Employers should take a close look at their current zero-tolerance or no drug policy to ensure that it specifically includes medical marijuana and cannabis products in its prohibition of illegal drug use or being under the influence during work hours. While not required, employers may want to consider verbiage that allows for further discussion if there is a condition that may require possible accommodations.

Keep in mind that a reasonable accommodation does not mean that employees have the right to “smoke breaks” or otherwise use or be under the influence of cannabis while at work. Reasonable accommodations could include a modified work schedule or an assessment and re-distribution of work load depending upon the circumstances. Of course, the employee would still need to provide medical documentation that the condition affects one or more life activities.

Of particular interest will be the outcome of a case involving former Kohl’s employee, Justin Shepherd, who was fired after testing positive for medical marijuana consumed off duty. After being injured at work, Shepherd consented to a drug test. Kohl’s terminated Shepherd after he tested positive for trace amounts of marijuana metabolites even after he provided documentation that he was being treated with medical marijuana. Shepherd maintained that his cannabis usage occurred at home four days before his shift.

While Kohl’s had a policy that prohibited employees from possessing or consuming alcohol or illegal drugs, or being intoxicated, it also contained language related to its operations in California and other states with medical marijuana laws. Specifically, the policy stated that “No person will be discriminated against in hiring, termination or in imposing any term or condition of employment or otherwise be penalized based upon either (a) the Person’s status as a registered medical marijuana cardholder; or (b) A registered medical marijuana cardholder’s positive drug test for marijuana components or metabolites.”

Shepherd’s lawsuit claims Kohl’s violated state law prohibiting disability discrimination and that the drug test and consideration of his cannabis use during the termination process violated his rights. In December 2015, Kohl’s successfully moved the case to the US. District Court, Eastern District. A Motion for Summary Judgment has been filed by Kohl’s and is pending. A further Settlement Conference has also been scheduled for mid-August 2016.

Without question, the issues of medical marijuana and the workplace are still developing. Employers should regularly review drug-free workplace policies as the legal landscape continues to evolve.

A CLOSE CALL: How Uber is Changing the 1099

/in

Murchison & Cumming Blog: Post 85

View Link

The recent upswing in app based driving services like Uber have blurred the line between employees and independent contractors.

At first glance, it would seem that Uber drivers are clearly independent contractors. Drivers enjoy the flexibility of when and where they accept assignments, while Uber is able to minimize business costs since the usual benefits afforded employees are absent (overtime pay, minimum wage, meal breaks, unemployment insurance, workers’ compensation, etc.). However, recent holdings have altered any clear distinction between the two classifications. The result is a multitude of so called independent contractors claiming to be employees entitled to benefits that traditional employees are guaranteed.

In June 2015, the California Labor Commission found Uber driver, Barbara Ann Berwick, to be an employee and awarded her $4,000 for reimbursement of business expenses (gas, bridge tolls) and interest (Case No. 11-46739 EK). In doing so, the Commissioner looked to the California Supreme Court case of S.G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341, which held that agricultural laborers harvesting crop under a written “share farmer” agreement were employees because the employer retained control over the production and sale of the crop. The Court specifically found that the retention of control the employer holds over an individual’s work is paramount in determining whether one is an independent contractor or employee (i.e. the right to control the manner and means of accomplishing the result desired).

In Berwick, the California Labor Commission rejected Uber’s contention that the driver was an independent contractor because the company still holds a strong control over the entire operation. For instance, drivers: 1) must pass a background and DMV check; 2) can be terminated based upon driver ratings; 3) must utilize a car less than 10 years old; and 4) have no authority in pricing (i.e. passengers pay a price set by Uber for the services provided and then a non-negotiable cut determined by Uber is provided to the driver). See also California Employment Insurance Appeals Board Case. No. 5371509 against Uber.

Despite recent California decisions like the above, other states have either held Uber drivers to be independent contractors or have, or are, in the process of implementing regulation requiring the independent contractor designation.

With bated breath, we have been waiting for the outcome of a California federal class action suit against Uber regarding classification of its drivers and appeals related to its arbitration agreement. (Douglas O’Connor, et al. vs. Uber Technologies, Inc. et al., US District Court, Northern District of California, Case No. 13-cv-03826-EMC). However, in April 2016 Uber settled the case along with a similar Massachusetts based case (Hakan Yucesoy v. Uber Technologies, Inc., et al., US District Court, Northern District of California, Case No. 4:2015cv00262) for a total of $84M, with an additional $16M if the company goes public and meets certain performance metrics. With this settlement, the drivers (California and Massachusetts) will remain classified as independent contractors rather than employees. Interestingly, named Plaintiff Douglas O’Connor objects to the proposed settlement and hired new lawyers in this regard.

Shortly after the O’Connor settlement, another similar class-action was filed against Uber in the Illinois Northern District Court on May 1, 2016 (Lorri Trosper v. Uber Technologies, Inc., Case No. 1:2016cv04842). In this newer case, the Uber drivers (all except California and Massachusetts) seek to change their classification from independent contractor to employee amongst other things. So for now, it looks like the debate will continue on.