Referendum could pose high risks for workplaces

24 September 2020

In less than two months, New Zealanders will vote in a referendum to decide if recreational cannabis should be legal.

If the majority vote "yes", the law doesn't change immediately. There will be some delay as a bill is introduced to Parliament and goes through the legislative process. This will give employers time to consider the range of issues that will accompany the legalisation of cannabis.

What legalisation looks like

The Government has released a draft Cannabis Legislation and Control Bill that gives voters an idea of what the legalization could look like. The draft Bill allows people 20 years old or over to buy a limited quantity of cannabis, consume cannabis on private property or at a licensed premises and to grow up to 2 cannabis plants. The Bill also includes measures to reduce cannabis-related harm.

If these changes are introduced, they will impact many aspects of society - including workplaces. Employers will have to consider how the law changes will impact the work they do, their health and safety obligations and the rights of their employees.

The legalisation of cannabis would likely result in an increase in cannabis use. Legalisation in other jurisdictions has resulted in an increase in positive tests for marijuana in workplaces. For instance, in the US, states where cannabis was legalized like Washington and Colorado had much higher increase in use than other states.

This indicates that cannabis use could become more common in New Zealand, which means employers are more likely to have to tackle cannabis related issues.

Health and safety

The main issue is of health and safety. Employers have a duty to ensure the health and safety of their workers so far as is reasonably possible under the Health and Safety at Work Act 2015 (HSWA).

Intoxicated or impaired employees in safety sensitive roles can be a serious hazard, regardless of whether the intoxicant is legal or illegal. Unfortunately, it is not always easy to spot impairment in the workplace.

For this reason, employers with employees working in safety sensitive roles should consider whether drug testing is an appropriate way to manage that potential hazard. If so, there must be provision for drug testing in the employees' employment agreement. Such provision should be supported by a clear policy setting out the process for testing, the reasons for testing and the consequences of a positive result.

The Employment Court and Employment Relations Authority have held that random drug testing can be a reasonable policy in such cases where the policy is a means to identifying potential causes of harm and monitor employees' exposure to hazards. However, any provision in an employment agreement or policy must be reasonable, balancing the risks to health and safety against the rights of the employee, including their privacy rights. The Court has also been clear that drug testing policies should be carefully followed, particularly where reasonable cause or employee consent is required under the policy.

Employers should also bear in mind that any new or revised health and safety policies should be drafted with consultation with affected employees, as is required under the HSWA. This consultation is also a good opportunity to educate employees of the dangers of impairment in safety sensitive workplaces, to promote compliance with the policy.

Other disciplinary matters

As with any intoxicant, an employee's performance or attendance in their role may be inhibited by the use of cannabis. Just because the substance may be legal does not mean that such performance issues cannot be dealt with like any other such issues. Employers should view such issues in the same manner as they would alcohol related performance issues and deal with them in accordance with the relevant performance improvement or disciplinary policies.

It should also be borne in mind that if an employee uses cannabis in a matter that brings the employer into disrepute, or is likely to bring the employer into disrepute, this could constitute a breach of the employee's implied duties to the employer. This can be treated as misconduct or serious misconduct and can justify disciplinary action up to and including dismissal.

In conducting any performance or disciplinary processes, if the employee is not in a safety sensitive role it will be much harder to require an employee to take a drug test. There must be provision for drug testing in the employment agreement, and even then it would be likely that such an instruction would be unreasonable in the absence of reasonable cause for testing.

Get prepared

Even if New Zealanders vote "yes" to legalising recreational cannabis, there is still some time before cannabis use would be legal. Employers should use this time to review the risks cannabis legalisation could present, and how these are dealt with by their employment agreements and policies.