This installment of the Cannabis Advisory Group’s webinar series includes panelists discussing the science, medicine and policy behind psilocybin. The event is sponsored by Capehart Scatchard’s Cannabis Law Group. David L. Nathan, MD, founder of Doctors for Cannabis Regulation, will moderate the panel.
On February 22, 2021, Governor Murphy finally signed three bills into law that effectively lay the ground work for legalized use of recreational marijuana in New Jersey. While it could be some time before widespread legalized marijuana is available for purchase as the state establishes the needed infrastructure for the sale of the drug through state licensed dispensaries, I have fielded a number of questions already from employers regarding how far they must accommodate employee use of recreational marijuana. The reality is that employees will have wider protections under the new use law, and though those protections are not absolute, most employers now will have to come to grips with the new reality that marijuana use after work hours will no longer be grounds to automatically discipline an employee.
The new law expressly bars an employer from firing or refusing to hire a person who uses marijuana in their free time. Nonetheless, employers who have “reasonable suspicion” that a worker is “high” during work hours may still drug test such an employee and ultimately fire or discipline them if the test result is positive. Moreover, if you happen to be a Federal contractor who is subject to drug free workplace requirements, you will have more latitude even under this new legal scheme in imposing restrictions for recreational marijuana use since failing to prevent drug use in your workforce could place in jeopardy your continuing contractor status.
The law further specifically allows an employer to do random, regular or pre-employment screening, but in doing so, it must include a “scientifically reliable” test of blood, urine or saliva, paired with a physical evaluation to determine if the employee is currently impaired, as well as a physical examination by an employee who undergoes training to spot marijuana impairment. What that training will require for such employer observers will likely be crafted as part of the expected regulatory framework to be implemented by the state. So stay tuned for additional developments on this topic.
Finally, a frustrating reality with which employers will now need to grasp even more is that, when it comes to marijuana, there is no widely-used and accepted physical drug tests for marijuana that can detect real time intoxication absent proof of immediate drug use and impairment. Instead, the current test merely reveals the presence of marijuana in the body, which can linger sometimes days or weeks after a person last consumed the drug. This could further limit the circumstances where corrective actions can be taken against an employee for recreational marijuana use.
Accordingly, in light of the passage of this statutory framework that paves the way for legal marijuana use, employers need to start reviewing their drug testing policies and bring them into compliance with the new standards for testing for marijuana use. Furthermore, once training standards are established, employers will need to designate corporate observers and ensure that they receive the requisite training to detect marijuana impairment. The sooner employers start to address such issues, the better it will be in dealing with this changed legal landscape involving recreational marijuana use.
Ralph R. Smith, 3rd is Co-Chair of the Employment and Labor Practice Group. He practices in employment litigation and preventative employment practices, including counseling employers on the creation of employment policies, non-compete and trade secret agreements, and training employers to avoid employment-related litigation. He represents both companies and individuals in related complex commercial litigation before federal states courts and administrative agencies in labor and employment cases including race, gender, age, national origin, disability and workplace harassment and discrimination matters, wage-and-hour disputes, restrictive covenants, grievances, arbitration, drug testing, and employment related contract issues.
It is official, Governor Murphy signed three bills that together legalize cannabis for adults 21 years of age and older, making New Jersey the 13th state to legalize cannabis. On Monday, February 22, 2021, Governor Murphy signed the bills in to law, after both the Senate and Assembly held voting to pass a third bill establishing civil penalties for those under 21 caught with cannabis.
Here are New Jersey’s new cannabis laws, effective immediately:
- New Jersey adults 21 years of age and older may legally purchase and possess up to one ounce of cannabis, although cannabis consumers will not have legal means to purchase it yet. Under A21/S21 a New Jersey Cannabis Regulatory Commission will be established to develop regulations to govern the medical and adult-use industries and oversee the applications for licensing of cannabis businesses. The bill directs the CRC to promote diversity and inclusion in business ownership and contains employment protections for people who engage in lawful behavior with respect to cannabis. The Cannabis Regulatory Commission still must be fully seated to oversee the cannabis industry, which has six months to set up its rules and regulations before it seeks new licensees for businesses. The bill provides for the Legislature to reinvest cannabis revenues in designated “impact zones” and all retail sales will be subject to state sales tax and seventy percent of that revenue will be given to these “impact zones.”
- The second law signed by Governor Murphy, A1897 reduces criminal and civil penalties for those found with larger quantities of cannabis in their possession (distribution of more than one ounce but less than five pounds), as well as provides remedies for people currently fighting certain cannabis charges, including a pathway to vacate active sentences for particular offenses committed before enactment of the enabling legislation. The bill prevents certain unlawful low-level distribution and possession offenses from being used in pretrial release, probation and parole decisions, and provides certain protections against discrimination in employment, housing and places of public accommodation.
- A third law signed by Governor Murphy, A5342/S3454 also refines penalties for cannabis possession and consumption for those under 21 years of age. This bill requires a series of written warnings, rather than criminal penalties or fines, for those under 21 years of age found with cannabis. Third-time offenders can receive community service. The law also restricts police from conducting searches of those under 21 years of age based solely on the odor of cannabis.
Legislation requiring the employer, workers’ compensation and PIP insurers to cover the costs of medical marijuana was passed by the NJ Assembly Appropriations Committee on October 26, 2020 and will be considered by the entire Assembly. Assembly Bill No. 1708, sponsored by Assemblyman John Burzichelli, Assemblyman Herb Conaway and Assemblywoman Joann Downey, requires that “an employer or workers’ compensation insurance carrier or private passenger automobile insurance carrier shall provide coverage for costs associated with the medical use of marijuana.” If enacted, this legislation will not require that private insurers or governmental health programs like Medicare or Medicaid cover the costs of medical marijuana.
A first step in requiring workers’ comp coverage of the costs of medical marijuana came on January 13, 2020 when the Appellate Division decided the case of Hager v. M&K Construction, 462 N.J. Super. 146 (App. Div.), certif. granted, 241 N.J. 484 (2020). This case required reimbursement of the costs rather than coverage of the costs as set forth in the legislation. The Hager case is currently on appeal to the New Jersey Supreme Court, which has agreed to hear the case.
On March 10, 2020, Sheila M. Mints, Chair of the firm’s Cannabis Law Practice, spoke at the NJ Cannabis Insider Live: The Road to Legalization conference. The conference, co-sponsored by Capehart Scatchard, was held at the New Jersey Convention & Exposition Center in Edison.
Ms. Mints participated in a panel discussion entitled, “Medical Cannabis – The Next Frontier.” The panel discussed the state of medical marijuana in the State of New Jersey as well as cannabis research and the forces shaping it.
Ms. Mints, a resident of Riverton, counsels businesses, public entities, and entrepreneurs interested in entering the multifaceted cannabis market. Additionally, Ms. Mints Chairs the Healthcare Law Practice where she specializes in healthcare transactional matters, including shareholder and employment agreements, purchases and sales of medical practices, including ACO transactions, and practice mergers.
Now removed from the 2018 Farm Bill’s federal controlled substances list, beginning this year (2020) hemp can be treated like any other agricultural commodity in New Jersey. The Garden State is one of the first three states to have its hemp program approved by the United States Department of Agriculture (USDA). Now the New Jersey Department of Agriculture (NJDA) can start accepting applications.
Here is what you need to know:
1) There are two types of licenses:
a) Grower (Producer) = a business or person who is authorized by the NJDA to cultivate hemp
i) Processor = Includes, but is not limited to, entities acquiring raw hemp materials and processing them into products.
ii) Handler = Those who possess or store a hemp plant on premises owned, operated, or controlled by a hemp producer for any period of time or in a vehicle for any period of time other than during the actual transport of the plant between premises owned, operated, or controlled by hemp producers or persons or entities authorized to produce hemp pursuant to any federal and state law or rule adopted pursuant thereto. Examples of “handlers” include, but are not limited to, seed cleaners, analytical labs, traders, harvesting entities, brokers, and other service providers.
The Program establishes a schedule of fees to be paid based upon whether the hemp producer will be growing, processing, or handling hemp. Growers will pay an annual $300 plus $15 per acre fee, handlers will pay a $450 annual fee, and processors will pay an annual fee for each type of hemp component they process. For example, a hemp producer who processes grain ($450) and CBD extract ($1,000) will pay a $1,450 annual fee. Growers are permitted to process and handle their own hemp without paying additional fees. However, once a grower processes or handles hemp from at least one (1) separate hemp producer, the grower must pay applicable processor and handler fees.
3) The NJDA has the following restrictions
a) N.J.A.C. 2:25-2.2 – requires a site modification fee any time a growing site is altered or added to an existing license. This is necessary, so that the Department can submit accurate records to the USDA, which must be kept apprised of the status of all hemp producers and have accurate legal descriptions of all land being used to produce hemp.
b) N.J.A.C. 2:25-2.2 – prohibits public access to hemp, such as hemp mazes or any other recreational activity. The Department deems these measures necessary to prevent members of the public from having unauthorized access to plants and seeds that could be used to cultivate hemp in violation of this chapter.
c) N.J.A.C. 2:25-3.2 – allows the Department to prohibit any hemp, seeds, plantlets, or propagules for any reason. If the Department determines that any particular strain or source for hemp is unreliable, it may be prohibited in order to protect the integrity of the program. Hemp farmers will suffer financial losses for every non-compliant field they must destroy, so it is more efficient to prevent non-compliant hemp from being planted to begin with. If non-compliant hemp is processed into foodstuffs, it could result in State or nationwide recalls.
4) The application must provide the geographical land area on which hemp is going to be cultivated, processed, or handled. The application is tied to a particular building for processing and includes buildings used for processing.
5) Unlike cannabis licenses, at this time the NJDA has not limited the number of licenses they will issue. However, make sure your application is done right as incomplete answers will remove your application from consideration.
6) Upon request by law enforcement, any person transporting hemp or hemp materials shall maintain and prove authorization to engage in the commercial sale of hemp under the NJ hemp program, along with a travel manifest that lists the origin, destination, product description, and date of transport. Third-party carriers are not required to be authorized hemp producers in order to transport hemp.
7) Hemp products may be transported across state lines and exported to foreign countries in a manner that is consistent with federal law and the laws of respective foreign countries under the Agriculture Improvement Act of 2018.
8) Provided the distribution is carried out in accordance with federal and state law, distribution of CBD extract outside of New Jersey is not prohibited if it was grown/processed in New Jersey.
If you are interested in learning more about the hemp application process or submitting an application in New Jersey, please contact me at email@example.com or 856.840.4945.
Professionals in Cannabis panel discussion and networking party at 1776 in Cherry Hill Mall, Dec. 5. Benefits cancer charity.
Please join us for a networking cocktail party and networking event for cannabis professionals. We invite anyone who is working the cannabis space or is thinking about it – researchers, growers, dispensaries. professional services.
There will be a moderated panel discussion with veteran cannabis professionals.
A light dinner buffet, wine and beer will be served.
Please join us for a free networking breakfast for professionals working in the cannabis space from 8:30 am to 10:00 am on Thursday, November 21st, at the law office of Capehart Scatchard in Mount Laurel.
Shareholder and Chair of the firm’s Cannabis Law, Sheila M. Mints, will address the changes to cannabis laws in the region. Sheila has been practicing in the medical marijuana space for many years and has tremendous perspective about New Jersey’s path to expanding medical marijuana in the region.
Refreshments will be served.
Networking Breakfast for Cannabis Professionals
Please join us for a networking event for cannabis professionals. We invite anyone who is working the cannabis space or is thinking about it – researchers, growers, dispensaries. professional services.
A continental breakfast and great coffee will be served.
The guest speaker will be announced.
The goal is to connect business professionals in the region or those thinking of making a leap into the cannabis industry.
Capehart Scatchard will have a marketing booth at the event.
Pop Up alert: Let’s get together for business networking coffee and bagels event in a relaxed setting.
Professionals working in the cannabis space are invited to meet like-minded individuals at a networking breakfast from 8 to 10 a.m. on Thursday, August 1st at 1776 offices in Cherry Hill Mall. In addition to networking, Sheila M. Mints, Esq., Chair of Capehart Scatchard’s Cannabis Law and Healthcare Departments, will provide a Q & A about the cannabis space in Pennsylvania and New Jersey.