Monday, April 30, 2012

Employer Must Act on Good Faith Belief to Claim Liability Shield

When the Arizona Legislature first adopted the Drug Testing of Employees Act in 1994, employers had to act based on a good faith belief to claim the liability shield that was the key benefit of that law.   When lawmakers expanded the Act in 2011 to give employers tools to ease their implementation of the Arizona Medical Marijuana Act (AMMA), they also fine tuned the meaning of  good faith.

Arizoneout explained in detail in a December 9, 2011 post how the liability shield can be used by employers when they act in good faith to exclude Qualified Patients (QPs) from safety-sensitive positions or discipline or discharge QPs whom the employer believes were impaired on the job or used cannabis on the premises or during work hours

In today's post, we consider just what good faith means under the  Drug Testing  of Employees Act.  The original definition in the Act defined good faith as "reasonable  reliance on fact, or that which is held out to be factual, without intent to deceive or be deceived and without reckless or malicious disregard for the truth."  So in plain language, an employer acts in good faith when it doesn't intentionally make up a pretextual reason for its actions or recklessly ignore the truth.

In the 2011 amendments that were tailored to the issues employers face in dealing with medical marijuana in the workplace, the legislature clarified that good faith does not include a belief formed with gross negligence.  In the legal hierarchy of mental states that governs civil and criminal liability, gross negligence is a lower level  of  culpability than evil intent or recklessness. 

So one the one hand, it appears that the legislature was tightening up on when employers could claim they were acting in good faith.  An honest belief that -- say -- a QP used marijuana during work hours would not fall under the liability shield if the employer was grossly negligent in forming that belief.  In that context, gross negligence probably would equate to having no facts to support that belief.

However, other tweaks to the definition of good faith give Arizona employers considerable leeway on  what sorts of evidence they can rely upon in taking adverse employment actions against QPs.  The legislature developed a laundry list of the kinds of things that an employer can rely upon in forming a good faith belief, including:

  • the employer's observation of the QP's conduct, behavior, or appearance.
  • written, electronic or verbal statements, presumably by the QP him or herself.
  • lawful video surveillance.
  • records of government and law enforcement agencies or courts.
  • results of a test for the use of alcohol or drugs.
  • information reported by a person believed to be reliable, including a report by a person who witnessed the use or possession of drugs or drug  paraphernalia at work.

The last one is especially significant, as the apparent intent is to allow the  employer to choose to believe the informant against the QP in a "he said-he said" situation, so long as the employer doesn't have some reason to doubt the credibility of the informant.

The definition of good faith in the Drug Testing of Employees Act also has an extremely broad catchall -- "other information reasonably believed to be reliable or accurate."

This generous definition of good faith is just one more reason employers concerned about workers legally using medical marijuana will have a policy in place that complies with the Drug Testing of Employees Act.

Monday, April 16, 2012

Medical Marijuana Fuels Lottery Fever For Dispensary License

A birthday present from Arizona Department of Health Services (ADHS) Director Will Humble awoke Arizoneout from its long winter's nap with a newfound commitment to keep those posts coming on a more regular basis.  Humble's blog post on April 11, 2012 − yes, that is the anniversary of Dinita James' birth − said his agency was dropping the flag on the race to apply for a dispensary license.

The demands of my law practice and other professional commitments seemed to call me away from blogging about the Arizona Medical Marijuana Act (AMMA) and its impact on workplaces in the state during the first quarter of 2012.  On starting my own personal new year, I had resolved to get back on the blog, with a goal of one or two posts a week.

So the email announcing Humble's blog post seemed to hit my inbox with karmic significance.  Full implementation of the AMMA may be in sight, barring another litigation explosion or a raid by the feds.  More Arizonans are bound to seek ID cards as Qualified Patients (QP) authorized to use medical cannabis if there are stores where they can go buy the stuff, or brownies and milkshakes containing it.

More QPs mean more issues about marijuana for Arizona employers to face.   More need for Arizoneout, then, too.

ADHS will start accepting dispensary applications on May 14, and the window to apply is only 11 days. 
ADHS will review the applications as they come in, and will issue registration certificates on August 7.  There's another certification and inspection required before dispensaries can open, but it appears likely that some dispensaries will be up and running long before the end of 2012.

One post Arizoneout did make during 1Q 2012 was to announce the clearing of the litigation logjam that had interrupted implementation of the AMMA.  The event that Humble called the flag drop was the filing of revised regulations with the Secretary of State.  Faced with a court order to strike several selection criteria ADHS had been planning to use in awarding dispensary licenses and to move forward to implement the law, Humble said that's "what we're doing."

If there are competing applicants for a dispensary license in a given territory, ADHS will determine the winner by random draw.  Megabonus for the winners!