Your Legal Rights

From the Law Office of Beeson, Tayer & Bodine

The impact on workers of California’s legalization and regulation of the marijuana marketplace

Last November, California voters approved Prop 64, also know as the Adult Use of Marijuana Act (AUMA), which legalized the recreational use of marijuana in the state. By doing so, California joined Alaska, Colorado, Washington, Oregon, Nevada, Massachusetts, and Maine in legalizing recreational marijuana use.

Although California’s law went into effect immediately after Prop 64 was adopted, the state will not start issuing commercial licenses to cultivate, transport, and distribute marijuana until January 1, 2018. Once that happens, the effects of the newly regulated marijuana marketplace on California’s economy will start to take shape (and the Teamsters are actively involved in organizing all aspects of marijuana cultivation, transport and distribution). This newly regulated market is likely to have a significant, yet still unpredictable, impact on the workplace.

The important parts: Prop 64...

• Legalizes possession and use of up to one ounce of marijuana and personal use cultivation of up to six plants per residence by adults 21 and over.

• Reduces penalties for most illegal cultivation, sale, transport, and possession for sale offenses from felonies to misdemeanors, with possible exceptions for repeat or violent offenders or other aggravating circumstances.

• Allows prior offenders to file to have their criminal records changed to what they would have been if Prop 64 had been in effect.

• Establishes a licensed regulation system for commercial production and sale of adult use cannabis beginning January 1, 2018.

• Levies a production tax of $9.25/ounce of flowers plus an additional 15% excise tax on retail sales of marijuana for both adult-use and medical-use effective January 1, 2018.

Under Prop 64, you may NOT:

• Consume marijuana in any public place ($100 infraction).

• Smoke or vaporize marijuana in a non-smoking area.

• Consume marijuana or possess an “open container” of marijuana while driving or riding as a passenger in any motor vehicle ($250 fine).

• Possess or use marijuana on the grounds of a school, day care or youth center while children are present ($100 fine).

• Minors under 21 may not possess, use, transport, or cultivate marijuana.

• Possession of more than one ounce remains a misdemeanor.

Prop 64 also does not apply on federal property, so possession in places like national parks is still illegal. Marijuana, including both THC and CBD, remains an illegal Schedule One substance under the U.S. Controlled Substances Act, however, federal charges are typically brought only in large cases where commercial distribution is suspected. It is uncertain what stance the Trump administration will take on enforcement of federal drug laws in California.

The rights of landlords and employers are not impacted by Prop 64. That means property owners may still forbid the possession or use of marijuana on their property, and employers may prohibit the use of marijuana by their employees.

As a result, the legalization of recreational use of marijuana will not change in any way employer drug testing policies and marijuana use will continue to be grounds for workplace discipline. This presents a particular concern for marijuana users because, unlike alcohol, THC levels remain detectable in urine and blood for a longer period after use. Depending on the frequency of use, an employee could test positive for up to twelve weeks after consumption, even though the employee is not under the influence at the time.

The intent of Prop 64 is for California’s marijuana industry to be highly regulated and monitored. The details are still being flushed out by the state agencies responsible for licensing and enforcement and it will likely take some time before the regulations are finalized. Even so, Prop 64 requires state agencies to begin issuing commercial licenses by January 1, 2018, and separate licenses will be required for cultivation, manufacture, distribution, transportation, laboratory testing, and sale of cannabis. The law requires the product be tracked from point of cultivation to point of sale to prevent unlicensed marijuana from entering the market and to maintain quality control.

One requirement is that the driver of a vehicle transporting cannabis must be directly employed by a licensee authorized to transport cannabis. The distributor may not sub-contract out the delivery work, which will prevent distributors from treating drivers as independent contractors. In addition, commercial marijuana licensees with 20 or more employees are required to enter into a “labor peace agreement” with a labor organization. At a minimum, the peace agreement must include a no-strike provision, an employer neutrality provision, and a provision for union access to the employer’s workplace.

Other than organizing the recreational marijuana industry, the biggest job for the union after January 1, 2018 will be to impress upon members subject to drug testing that just because recreational use of marijuana is no longer a violation of criminal law, it remains a basis for members to be disciplined or discharged as a result of a positive test.

Beeson, Tayer & Bodine — Oakland: 510-625- 9700. Sacramento: 916-325-2100.