Monday, June 20, 2011

Small Employers Can’t Ignore Medical Marijuana Implications

The Arizona Medical Marijuana Act (AMMA) applies to every employer in the state, even those that have only a single employee.  That may come as a shock to small businesses, who are accustomed to thinking that they are not subject to various state and federal laws prohibiting discrimination or otherwise regulating the employer-employee relationship.

Unlike the Arizona and federal civil rights acts, which do not cover small businesses having fewer than 15 employees, the AMMA does not even define the term “employer.”  But all state “employers” are subject to the AMMA’s prohibition on discrimination against Cardholders, which includes both Qualified Patients (QP) and Designated Caregivers (DC), unless they would lose a federal monetary or licensing related benefit.  (Much more to come on what that exception means in future posts.)

The tests for whether one is an employer are highly fact specific, and also can vary depending on the reason for the inquiry.  Courts in Arizona probably will be making decisions on who is an employer subject to the AMMA for the next decade, if not longer.  Until that happens, there is going to be some uncertainty as to whether a particular business relationship is an employer-employee one.

For small businesses who want to err on the side of caution in the meantime, they should consider that anyone for whom they remit payroll taxes to the IRS likely enjoys the protections of the AMMA.

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