Key Takeaways:

• As of July 1, Maryland’s Cannabis Reform Act allows adults 21 years of age and older to legally possess up to 1.5 ounces of cannabis flower. However, the state remains without detailed legislation and/or regulations to guide employers and workers on marijuana use among employees.

• Whether the drug is available recreationally or medically, until federal law changes, employers and insurers still cannot agree to pay for marijuana in a workers’ compensation claim because they face federal penalties.

• Employers and insurers are encouraged to follow legislative updates and modifications over the ensuing years and implement clearly articulated company policies.

Maryland’s Cannabis Reform Act took effect July 1, 2023, following the November 2022 referendum in which Marylanders voted to legalize cannabis for adult use. The new law allows, among other things, adults 21 or older to legally possess up to 1.5 ounces of cannabis flower.

Accordingly, Marylanders can legally buy cannabis and cannabis products, and such sales are subject to 9-percent sales and use tax. Maryland remains without detailed legislation and/or regulations to guide employers and employees on marijuana use amongst employees.

Employer Strategies and Considerations

For reasons outlined below, employers and insurers are encouraged to understand, and do, the following:

• Nothing in Maryland law prevents an employer from testing for use of cannabis, or taking action against an employee who tests positive for use of cannabis
• Recognize that the law, the fluid state of marijuana nationally, and the cultural landscape are changing fast and will continue to do so for the foreseeable future
• Maintain organizational flexibility and stay apprised of changes in the laws locally and nationally
• Adopt and implement clear, written policies to employees based upon company culture, expectations, and standards
• Identify if one’s company has jobs that require a heightened standard of care due to higher risk of harm to employee or others (e.g. operating heavy machinery)
• Apply standards consistently to all employees to avoid civil exposure for inconsistent practices
• Focus policies on employee’s ability to work and overall conduct, not testing schedules

Maryland and Federal History

Previously, medical marijuana was legalized in Maryland in 2014 and became operational by 2017. That same year, workers’ compensation attorneys anticipated many disputes over authorization of medical marijuana, including whether marijuana prescribed to treat a work-related injury should be subject to the Maryland Workers’ Compensation medical bill guidelines. The key question was how to handle the issue given that federal law prohibited marijuana use despite state legalization of medical use.

Now, the same question faces workers’ compensation parties in Maryland: How will medical expenses for marijuana be treated if the drug is prescribed to treat a compensable work-related injury in Maryland since federal law prohibits the drug? Federal law still classifies cannabis as a Schedule I controlled substance under the federal Controlled Substances Act (21 U.S.C.  § 801), which prohibits the manufacture, distribution, dispensation and possession of marijuana.

According to a March 2023 Congressional research memorandum, adult use of cannabis (18 years and older) increased from 6.3 percent in 2008 to 13.7 percent in 2021 in the United States.^[1] Further, the increase in states adopting both medical and recreational cannabis legislation continues to shed doubt on the federal Schedule I drug classification attached to cannabis. Such classification relies on the Drug Enforcement Administration (DEA) and Food and Drug Administration (FDA) finding that cannabis has a high potential for abuse and no currently accepted medical use in the United States. As more states legalize medical and recreational use, however, we can expect federal law to change as well. Currently, 38 states plus the District of Columbia have medical marijuana programs.^[2] Further, 23 states plus D.C. have legalized marijuana.

Drug Testing and Termination

Many employers and insurers have expressed concern over difficulties with marijuana legalization, drug testing, and concerns over intoxication on the job. It is important for employers to recognize that, just like alcohol, marijuana may not be used while on the job. In fact, employers can currently test for cannabis and terminate for a positive test for any reason. Such a policy should be subjected to scrutiny before acting on such information.

Pre-Hiring Drug Testing: Employers can legally conduct alcohol and drug tests prior to hiring. Maryland’s employee drug testing laws specifically state that employers do not need to accommodate use in the workplace, and employers can discipline or terminate an employee who tests positive for off-duty marijuana use, regardless of the reason.

Post-Hiring Drug Testing: Employers can test for controlled substances, including marijuana. However, the use of a positive test to support termination in the absence of any indication that the employee was under the influence on the job could result in future legal action against the employer. While not illegal, it is foreseeable that Maryland will amend current laws to make termination for the use of a legally consumable product on one’s free time discriminatory.

If, on the other hand, there is suspicion of an employee being under the influence when injured or involving an incident in the workplace, there are no current legal protections in Maryland or any other state. As the stigmatization of marijuana use changes nationally, monitoring any such changes to the laws for the use of marijuana for medical purposes is encouraged. The ongoing federal illegality of marijuana continues to act as a hindrance on the use of the ADA to carve out an exception to the reasonable accommodation of marijuana for users with a medical need.

Future Maryland Handling and Defense Strategy

Despite the rapid recent change in marijuana legislation among states and the District of Columbia, the same Schedule I classification of marijuana at the federal level has existed since the 1970s. Now, with more than 75 percent of the United States currently supporting at least medical marijuana, federal law is likely to finally change. Once this change occurs at the federal level, we can expect cannabis to be subject to the medical fee guides across state workers’ compensation laws, including Maryland. Case law developing the liberalization of marijuana usage can be expected to continue as long as the federal v. state distinction remains contradictory.

For now, Maryland defense lawyers can continue to object to claims for payment of cannabis to treat work-related injuries since federal law prohibits cannabis use and dispensation. If and when federal law changes, it may be worth accepting marijuana prescription costs in workers’ compensation claims where cannabis presents a cheap and safer alternative to opioids.

Although Maryland laws now permit both medical and recreational cannabis use among adults, the impact on Maryland workers’ compensation is similar to the previous passage of medical marijuana. Whether the drug is available recreationally or medically, until federal law changes, employers and insurers still cannot agree to pay for marijuana in a workers’ compensation claim because they face federal penalties.

Employers and insurers are encouraged to follow legislative updates and modifications over the ensuing years and implement clearly articulated company policies.

[1] “The Federal Status of Marijuana and the Expanding Policy Gap with States,” Congressional Research Service, March 6, 2023

[2] “State-by-State Medical Marijuana Laws,” ProCon.org, June 5, 2023