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June 9, 2021

Legal News

June 9, 2021

New York Updated Cannabis Regulation

New York recently passed the Marijuana Regulation and Taxation Act (“MRTA”), which immediately legalized adult recreational use of cannabis, making the Empire State the 15th state, along with the District of Columbia, to legalize adult recreational use of cannabis. In 2018, Governor Cuomo directed the Department of Health to perform a multi-agency study, which concluded that the positive impacts of legalizing adult-use cannabis far outweighed the negatives, finding “that decades of cannabis prohibition have failed to achieve public health and safety goals”.

The MRTA, which was signed into law by Governor Cuomo on Wednesday, March 29, 2021, establishes New York’s “Office of Cannabis Management (“OCM”) and a licensing system” for the distribution of the right to produce, distribute, and sell cannabis for recreational use; “expands New York's existing Medical Marijuana Program; and creates a Social and Economic Equity Program” designed to encourage individuals who have historically been “disproportionately impacted by cannabis enforcement” to participate in the industry.

The OCM is charged with managing a two-tier licensing structure that is designed to separate cannabis growers and processors from also owning cannabis retail stores in an attempt to foster a robust entrepreneurial industry. Municipalities, however, are given the opportunity to “opt-out of allowing adult-use cannabis retail dispensaries or on-site consumption licenses by passing a local law by December 31, 2021 or nine months after the effective date of the legislation”, but cannot opt-out of the legalization of adult recreational use of cannabis. Such provisions make it unlikely that the OCM will be able to make and enforce rules regarding the distribution and sale of cannabis for at least several more months.

Legalizes Adult Recreational Use of Cannabis

Although adult recreational use of cannabis has already been decriminalized, in 2019, the MRTA affords a number of additional protections that both employers and employees need to be made aware of. Individuals, who are the age of 21 or older, may now possess and consume up to three (3) ounces of cannabis and twenty-four (24) ounces of concentrated cannabis, except when in public spaces or vehicles. Therefore, the use of cannabis by drivers will remain illegal and carry the same penalties as before.

Provides Protections for Adult Recreational Use of Cannabis Outside of the Workplace

The MRTA provides additional protections to the New York Labor Law 201-d, adding protections for the use of cannabis outside of the workplace. Under the MRTA, it is now unlawful to discriminate against adult employees for their recreational use of cannabis outside of the workplace, unless that “employer is required to take action against the employee, as provided by another state or federal law, or where the employer’s not taking action would result in the loss of a federal contract or federal funding for the employer”; however, additional workplace safety protections has also been implemented.

Provides Workplace Protections

Under the MRTA, employers are permitted to prohibit the consumption of cannabis at the workplace, and may penalize employees for working while inebriated, as a result of recreational cannabis usage. Furthermore, employers may also require an employee to be drug tested if the employer has reason to believe that the employee was inebriated while on the job, provided that the employer covers the expense of testing.

Adverse Impact on Cannabis Screening

Since the MRTA prohibits the discrimination of adult employees for their recreational use of cannabis outside of the workplace, most employers may not rely upon a pre-hiring cannabis test as reasoning for not hiring a potential employee, unless the employer falls within the above- mentioned exceptions or the employment positions involves health, safety, law enforcement, construction, childcare, and/or permitted through a collective bargaining agreement.

Regulations surrounding adult recreational use of cannabis are currently undergoing drastic and rapid changes. As various parts of the state begin to adapt to the new cannabis legalization, we will continue to provide guidance regarding how such changes may impact your place of business and/or employment. Please do not hesitate to reach out to us for additional guidance regarding any concerns you may have regarding the MRTA.

Photo by Ryan Lange on Unsplash
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