The California Supreme Court’s opinion in Ross v. RagingWire Telecomm, Inc. emerged from a collision among principles of constitutional, criminal, and employment law, as well as public policy. The Court decided, 5-2, that employers have no duty under the Fair Employment and Housing Act (“FEHA”) to make “reasonable accommodation” for marijuana use permitted by California’s Compassionate Use Act. The Court also unanimously ruled that the plaintiff could not maintain a common law action for wrongful termination in violation of public policy. Rather, the Court reaffirmed its watershed drug testing decision in Loder v. City of Glendale, holding “[u]nder California law, an employer may require preemployment drug tests and take illegal drug use into consideration in making employment decisions.” The Court’s opinion was based on an analysis of the relationship among the Compassionate Use Act, the FEHA, the California Constitution, and applicable provisions of federal law.

The Compassionate Use Act

The “Compassionate Use Act,” designated Proposition 215, is an initiative statute, which took effect on November 6, 1996. The initiative added section 11362.5 to the Health and Safety Code. Subsection (d) of the statute provides: “[H&S Code] Section 11357, relating to the possession of marijuana, and Section 11358, relating to the cultivation of marijuana, shall not apply to a patient, or to a patient’s primary caregiver, who possesses or cultivates marijuana for the personal medical purposes of the patient upon the written or oral recommendation or approval of a physician.” Section 11357 prohibits possession of marijuana and prescribes various penalties depending on the quantity. Section 11358 provides that cultivation of marijuana is a felony.

Thus, Prop. 215’s operative provisions exempted from criminal sanction the possession or cultivation of marijuana for “personal medical purposes.” But the law does not expressly address a number of situations that arise from lawful cultivation or possession of marijuana. For example, transporting marijuana for any purpose remained illegal after Prop. 215’s passage.

To remedy perceived omissions and clarify Prop. 215, the Legislature passed SB 420 in 2003. Called the Medical Marijuana Program Act, the statute implements an administrative scheme through an identification card program, exempts those in possession of such cards from prosecution for not only possession and cultivation, but also transportation and delivery of medical marijuana, and made other provisions to expand Prop. 215’s protections.

SB 420, however, like Prop. 215, did not exempt medical marijuana users from employers’ decisions to refuse them employment. Indeed, the law actually provides “[n]othing in this article shall require any accommodation of any medical use of marijuana on the property or premises of any place of employment or during the hours of employment.”

Given Prop. 215’s seemingly limited scope, does the right to use marijuana under Prop. 215 require employers to ignore the results of drug testing revealing marijuana in an applicant’s system? Did Prop. 215 include the right to work along with the right to cultivate or possess marijuana for personal use? The California Supreme Court answered both questions in the negative.

The RagingWire Decision

The Supreme Court decided RagingWire after a demurrer. So, all allegations in the complaint were accepted as true. Gary Ross applied for a position with RagingWire Telecommunications, Inc. Because of an injury suffered in the military, he experienced chronic back pain and muscle spasms. He received a doctor’s recommendation under Prop. 215 to use marijuana to ease his pain and muscle spasms. RagingWire subjected Ross to a routine, pre-employment drug test. After the results came back positive for marijuana’s metabolites, RagingWire terminated Ross’s employment.

Ross claimed that discharging him because he failed the drug test amounted to disability discrimination under FEHA. According to Ross, Prop. 215 rendered his marijuana use lawful, because marijuana should be treated like any other prescription drug. Ross alleged RagingWire did not attempt to accommodate him, which could have included waiving the drug testing requirement. He disclaimed any intention to smoke marijuana at work, or to work under its influence

The Sacramento County Superior Court sustained the company’s demurrer, holding FEHA does not require employers to waive drug testing requirements regarding marijuana use sanctioned under Prop. 215. The Third District Court of Appeal affirmed in a 3-0 decision.

The Supreme Court granted review. The Court considered two issues: whether the FEHA requires an employer to “reasonably accommodate” medical marijuana use and whether an employee fired for using medical marijuana may bring a claim for wrongful termination in violation of public policy.

Claim Under the Fair Employment and Housing Act

Justice Werdegar wrote the Court’s opinion. Five justices agreed that the FEHA did not protect Ross’s use of marijuana, even pursuant to Prop. 215. The FEHA, of course, prohibits discrimination based on disability. It also requires employers to make “reasonable accommodation” to the extent they enable employees with disabilities to perform their essential job functions.

The majority inferred from Ross’s complaint that Ross sued because RagingWire did not “reasonably accommodate” his use of medical marijuana under Prop. 215 by waiving its drug testing requirement. As Ross argued, “‘[j]ust as it would violate the FEHA to fire an employee who uses insulin or Zoloft, . . . it violates [the] statute to terminate an employee who uses a medicine deemed legal by the California electorate upon the recommendation of his physician.'”

The Court rejected Ross’ analogy. The Court recognized the primary problem with Ross’ argument is that the Compassionate Use Act did not turn medical marijuana into a prescription drug like insulin or Zoloft. As the Court recognized, it would have been “impossible” for the electorate to confer upon marijuana the same status as prescription drugs because “[n]o state law could completely legalize marijuana for medical purposes because the drug remains illegal under federal law, even for medical users . . . .”

Having determined marijuana remains an “illegal” controlled substance, the Court examined whether the Compassionate Use Act expressly or impliedly modified existing California employment laws. After analyzing the text and ballot arguments in support and against Prop. 215, the majority decided that by passing the Compassionate Use Act, “California’s voters merely exempted medical users and their primary caregivers from criminal liability under two specifically designated state statutes.” Given these “modest goals,” the Court was unwilling to extend the Compassionate Use Act under the theory that it modified the FEHA sub silentio.

Finally, the Court succinctly held: “The FEHA does not require employers to accommodate the use of illegal drugs.” In reaching this conclusion, the Court reaffirmed its decision in Loder v. City of Glendale, decided after the Compassionate Use Act was enacted. In Loder, the City of Glendale, California, implemented a drug testing program for all individuals offered “new” positions (whether they were new hires, or promotions of existing employees). Loder challenged the drug testing rules as an invasion of privacy. Applying a balancing test, the Court decided that employers may conduct pre-employment testing for illegal drugs without violating constitutional privacy rights. In RagingWire, the Court relied on Loder in concluding, “[u]nder California law, an employer may require preemployment drug tests and take illegal drug use into consideration in making employment decisions.”

In all, the RagingWire opinion confirmed known employment law principles: employers may conduct (properly administered) pre-employment drug tests without running afoul of any California law, and the FEHA does not require employers to tolerate unlawful conduct as a form of “reasonable accommodation.”

Justice Kennard, in an opinion joined by Justice Moreno, dissented from the majority’s opinion regarding the FEHA claim. The dissenters would have held that the Compassionate Use Act protected medical marijuana users from “sanction” by employers. Additionally, Justice Kennard read the FEHA as requiring RagingWire to ignore Ross’ marijuana use as a reasonable accommodation of his alleged disability.

Wrongful Termination in Violation of Public Policy

While the justices split 5-2 on the FEHA claim, they unanimously decided Ross could not successfully assert a common law claim for “wrongful termination in violation of public policy.” To succeed on such a claim, “the policy in question must satisfy four requirements: äóÖFirst, the policy must be supported by either constitutional or statutory provisions. Second, the policy must be “public” in the sense that it “inures to the benefit of the public” rather than serving merely the interests of the individual. Third, the policy must have been articulated at the time of the discharge. Fourth, the policy must be “fundamental” and “substantial.”‘”

Ross suggested that RagingWire discharged him contrary to the public policy protecting an individual’s choice of Prop. 215 itself, the FEHA, and the right to privacy guaranteed by the California Constitution. Regarding Prop. 215, the Court held that the law did not put employers on notice that discharging Ross would violate public policy. Justice Kennard, concurring and dissenting, agreed that there could be no “fundamental public policy” in light of the disagreement between federal and state authorities on medical marijuana use. The Court rejected the argument that FEHA evinced a public policy in favor of marijuana use. And the right to privacy argument failed in light of Loder. Ross also argued that his discharge violated a public policy supporting his right to choose medical treatment. However, the Court pointed out that RagingWire did not preclude Ross from obtaining treatment or using marijuana. Rather, RagingWire simply refused to employ him.

Aftermath

Although the Court decided that the Compassionate Use Act did not grant medical marijuana users rights under established employment law generally, the Court did not say it would be impossible to do so. On February 21, 2008, less than a month after the Court’s decision in RagingWire, Assembly Member Leno introduced AB 2279. The law would add a section to the Medical Marijuana Program Act rather than FEHA. If passed, the bill would outlaw employment discrimination against medical marijuana users, which would specifically include adverse action based on a positive drug test for marijuana, provided the use was pursuant to the Medical Marijuana Program Act. The proposed legislation permits a civil action for damages and injunctive relief. The bill also contains an exception, providing no protection for employees in “safety-sensitive positions.” Because the bill has just been introduced as of the time of this writing, it is unclear whether it will be passed as written or amended, or whether the Governor will sign it.

Even before the RagingWire decision, voters introduced a proposed initiative to repeal all criminal sanctions for marijuana and prohibit drug testing for marijuana for employment or insurance purposes. It is unknown as of now whether the proponents will have sufficient signatures by the April 24, 2008 deadline to qualify the measure for the November 2008 ballot.

Unless the Legislature or the voters overturn the RagingWire decision, employers remain free to conduct applicant testing for marijuana use, as well as other illegal drugs. However, there remain limitations on drug testing employees in California, particularly in the absence of “reasonable suspicion.” Therefore employers and their lawyers should carefully research this area of the law before implementing drug testing programs for marijuana or otherwise.