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April 2013

Appellate Decision Clears the Air for Employers Concerned About Colorado's Legalization of Marijuana

Following the legalization of recreational marijuana use in Colorado, employers have been left to wonder what, if any, impact Amendment 64 will have on their ability to test and take employment action against an employee for use of marijuana.

In an important decision for Colorado employers, the Court of Appeals ruled the use of medical marijuana is not a lawful activity under § 24-34-402.5 C.R.S. 2012, Colorado’s Lawful Activities Statute. The April 25 decision in Coats v. Dish Network L.L.C. offers further guidance regarding an employer’s ability to maintain drug testing policies and, specifically, policies regarding the use of marijuana. 

In Coats v. Dish Network LLC, Brandon Coats, a telephone operator for DISH Network L.L.C, was fired in 2010 after failing a company drug test.  Mr. Coats was a medical marijuana patient who had been paralyzed as a teenager in a car crash. By all accounts, Mr. Coats was a good employee. Despite this fact, Coats was terminated for failing a company drug test. The test was performed on a random basis and the employer did not claim Coats was ever impaired on the job.

Coats sued his former employer alleging his termination violated Colorado’s Lawful Activities Statute. The Statute prohibits an employer from discharging an employee for “engaging in any lawful activity off the premises of the employer during non-working hours,” subject to certain exceptions, under C.R.S. § 24-34-402.5. The trial court granted DISH’s motion to dismiss Coats’ complaint after determining that the plaintiff’s medical marijuana use was not a “lawful activity” under Colorado law. Specifically, the trial court followed other courts’ prior rulings to find that the medical marijuana law did not establish a state constitutional right to medical marijuana use, but rather created an affirmative defense from prosecution for such use.

In upholding the trial court’s decision, the Colorado Court of Appeals analyzed the meaning of “lawful” and noted that activities conducted in Colorado, including medical marijuana use, are subject to both state and federal law. Therefore, for an activity to be “lawful” in Colorado, it must be permitted by, and not contrary to, both state and federal law. Applying the plain and ordinary meaning of “lawful activity” in Colorado’s Lawful Activity Statute, the court found that the plaintiff’s medical marijuana use must comply with both state and federal law. Thus, because the plaintiff’s state-licensed medical marijuana use at the time of his termination was subject to and prohibited by federal law, the court concluded it was not a “lawful activity” for the purposes of the Colorado Lawful Activity Statute.

Attorneys representing employees and employers have been waiting for a decision in this case to provide guidance to clients regarding Colorado’s Amendment 64, which legalizes recreational marijuana use. Amendment 64 specifically indicates that it is not intended to affect the ability of employers to have policies restricting the use of marijuana by employees. Now, with further guidance from the Colorado Court of Appeals regarding the Lawful Activity Statute, employers should feel more confident that a prohibition against all drugs that are illegal under state and federal laws will not violate the Colorado Lawful Activity Statute. 

To read the opinion, please click here.

Employment Law

Employment Law