Cannabis – A Prescription for Lawful Termination of Employment?

Robbie Bryant, Senior Associate at TODD & WALKER joins Legalwise to share Insights into lawful termination of employment on the grounds of impairment or undue health risk, as a result of drug use, since The Medical Cannabis Scheme came into effect in 2020.  Robbie explores the interplay between employer responsibility and the legal consumption of medicinal cannabis, thus creating murky waters of legality, should an employee be deemed ‘under the influence’ and unfit to continue employment. 


The medicinal cannabis scheme came into effect in April 2020.  One of the purposes of the scheme is to allow the legal prescription of medicinal cannabis products. The natural result is of course people using (lawfully) cannabis to alleviate various ailments.  Rightly or wrongly, social perceptions towards the use of cannabis whether for medicinal or recreational purposes seem to be shifting – the consumption of cannabis or related products appears to be more acceptable than it was in the past, as does clinicians’ acceptance that it can help with many chronic syndromes.

That said, there appears to be consensus among clinicians that THC – the psychoactive ingredient in cannabis, impairs cognitive and psychomotor performance.  In the workplace, impairment of this nature is of course a serious concern.  Employers have obligations under the Health and Safety Work.  These include eliminating, or if this is not possible, minimizing risks so far as is reasonably possible.  Any failure to do so, can result in serious liability.

So, how then is an employer to address the use of cannabis by employees?  The obvious response is to test for impairment.  If an employee returns a test that confirms that they are impaired, then necessary action can be taken.  Therin lies the problem.  Current testing methodologies test for the presence of THC.  These tests do not correlate well with impairment.  Furthermore, these testing methodologies can detect THC from cannabis use days to even weeks prior to the test.  Could a person still be impaired a few days or weeks after use, and to a level that necessitates taking action to address supposed health and safety risks?

Impairment was recently considered by the Employment Relations Authority.  A truck driver was randomly tested for drugs and alcohol.  The testing methodology was a single urine test.  The result showed levels of THC above the levels lawfully set by the employer.  The employment agreement defined serious misconduct as non-exhaustively being ‘under the influence’ of drugs whilst at work or driving a company vehicle.  There were competing arguments about whether the employee was ‘under the influence’.  Experts were called by both parties.  Both agreed that a one-off urine test could not confirm impairment.  Notwithstanding this, the Authority concluded that the employee was ‘under the influence’ and so the employer could lawfully dismiss the employee.

How then does this translate to the use of cannabis for medicinal purposes prescribed by a clinician?  It is arguable that even if the employee in the above case had been lawfully prescribed cannabis, because he was ‘under the influence’ and the employer is obliged to eliminate risks to health and safety, termination could still be justifiable.

We understand that the determination referred to above is being challenged (appealed) to the Employment Court.  Perhaps a different conclusion will be reached by the Court…

Robbie is a Senior Associate and is TODD & WALKER Law’s employment law specialist. Robbie is primarily based in TODD & WALKER Law’s Wanaka office but also works across the Queenstown office. Robbie advises clients on a full range of contentious and non-contentious employment matters. He has advised start-up businesses through to some of New Zealand’s leading public and private sector organisations, including not-for-profit organisations. Robbie also advises employees at all levels including senior managers and executives. An experienced litigator, Robbie represents clients in the Employment Relations Authority and Employment Court, and he has made appearances in the Court of Appeal and the Supreme Court. Robbie is regularly asked to appear for clients in mediations and has also appeared before the ACC Review Authority and Human Rights Commission.  Robbie also has experience in conducting external investigations and mediating disputes. Connect with Robbie  via LinkedIn