Cannabis Legalization and the Workplace

The proposed Cannabis Act has numerous implications for employers in Canada

Bill C-45, An Act respecting cannabis and to amend the Controlled Drugs and Substances Act, the Criminal Code and other Acts (the Cannabis Act) was introduced in the House of Commons on April 13. The Cannabis Act seeks to create a legal framework for controlling the production, distribution, sale and possession of cannabis in Canada. If passed, the Government of Canada aims to bring the Cannabis Act into force on July 1, 2018.

What You Need To Know

The legalization of cannabis in Canada has many implications for employers. In particular, employers should consider the following:

  • Cannabis remains illegal other than for medical purposes:  Cannabis remains illegal as the bill moves through the legislative process. The Government’s plan to legalize recreational marijuana does not contemplate forgiveness of previous convictions. Use of cannabis for medical purposes has been legal in Canada since 1999, subject to the cannabis for medical purposes regime. A separate medical cannabis system will likely be maintained following legalization of recreational cannabis.
  • Prepare for it in the workplace: Cannabis is an impairment-causing substance. Employees have never had a right to work while impaired, nor will they with the passing of the Cannabis Act. However, following the legalization of recreational cannabis, employers will likely see its use or effects increasing in the workplace. Employers should educate themselves about cannabis, including its various forms and effects, and prepare for how they will address it in the workplace. How will they detect, investigate and respond to potential cases of employee impairment in the workplace? How should they modify their drug and alcohol policies to address the use or effect of cannabis at work, for both medical and recreational purposes? What training should they give to staff and management? These and other issues should be considered and determined well in advance of the legalization of cannabis.
  • Accommodation where there is a legitimate disability: The Supreme Court of Canada recently confirmed that Canadians have a constitutional right to use cannabis for medical purposes.1 Employees may be prescribed medical cannabis to deal with a number of conditions, including chronic pain, cancer, arthritis and sleeping disorders. Addiction to cannabis may also constitute a disability under applicable human rights laws. When an employee discloses either medically prescribed use of or an addiction to cannabis, the employer should be prepared to obtain and assess the information required to meet its legal obligation to accommodate the employee’s disability, up to the point of undue hardship.
  • Privacy interests and testing: The Supreme Court of Canada has stated that employers are required to balance their interest in drug testing to ensure a safe work environment with employee privacy interests.2 Random drug and alcohol testing is only permissible in certain, limited circumstances, such as post-incident testing. A key challenge is that there is currently no reliable way of testing current impairment from cannabis use.
  • Ensure safety of workers: The use of cannabis in the workplace raises concerns under occupational health and safety legislation, such as Ontario’s Occupational Health and Safety Act, which requires employers to take reasonable precautions for the protection of workers. On the other hand, refusing to allow an employee to work due to cannabis use (whether medical or recreational) may constitute discrimination on the grounds of disability.
  • Review benefit policies: The treatment cost for medical cannabis is generally between $10,000 and $20,000 per employee per year, and there are no income tax barriers to coverage of the drug by private plans. The Nova Scotia Human Rights Commission recently held that the denial of coverage for cannabis for medical purposes amounted to prima facie discrimination.3 Arguments for declining coverage for cannabis for medical purposes on the basis that it is "not a reasonable and necessary medical expense" have mostly been unsuccessful. Employers should consult with their benefits plan providers regarding approach to coverage of these expenses.

These issues and others will be addressed at our upcoming panel discussion, Cannabis Legalization and the Workplace, at our Toronto offices, on Wednesday June 7, 2017, beginning at 8:00 a.m. Click here for more information about the session.


1 R. v. Smith, 2015 SCC 34.

2 Communications, Energy and Paperworkers Union of Canada, Local 30 v. Irving Pulp & Paper, Ltd., 2013 SCC 34.

3 Skinner v. Board of Trustees of the Canadian Elevator Industry Welfare Trust Fund, 2017 CanLII 3240.

To discuss these issues, please contact the author(s).

This publication is a general discussion of certain legal and related developments and should not be relied upon as legal advice. If you require legal advice, we would be pleased to discuss the issues in this publication with you, in the context of your particular circumstances.

For permission to republish this or any other publication, contact Janelle Weed.

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