Employers are scrambling to stay on top of ever-evolving cannabis laws across the country, but federal government contractors face an added layer of uncertainty as they attempt to navigate their legal obligations to the U.S. Government.  One particular area of concern for government contractors operating in a state with a legalized marijuana program is compliance with the federal Drug-Free Workplace Act (“DFWA”), 41 U.S.C. § 8102.  If you are a company that holds federal government contracts, here’s what you need to know about the DFWA:

First, federal law requires that most federal government contracts include a clause requiring the contractor to comply with the DFWA.  Specifically, every contract above the simplified acquisition threshold (currently, $250,000), other than a contract for commercial items, requires that the contractor comply with the DFWA in order to be considered a “responsible” source eligible for federal procurements.

Second, in order to comply with the DFWA, contractors must make a “good faith effort” to maintain a drug-free workplace.  Contractors must take specific actions, including posting a notice regarding their drug-free workplace policies; establishing a drug-free awareness program; requiring employees to notify the employer of any criminal drug statute conviction for a violation occurring in the workplace; notifying the contracting agency of such convictions; and imposing sanctions on any employee who receives such a conviction.

Third, the DFWA does not require employers to conduct drug screenings on their employees, nor does it require employers to monitor or sanction employees’ drug use outside of the workplace.  That said, even where marijuana is otherwise legal under state law, employers cannot permit the use, possession, sale, or distribution of marijuana in the workplace.  Generally, employers that have implemented drug testing and a zero tolerance drug-free workplace program in order to comply with the DFWA may continue to do so; however, certain states have anti-retaliation laws that protect users of medical marijuana from adverse employment decisions based on their marijuana use.  Because of this, employers may need to carve out exceptions to zero-tolerance policies in some cases.

Fourth, and finally, penalties for violating the DFWA can be severe – including termination, suspension, or debarment from future federal procurements.  Contractors should become familiar with their obligations under the DFWA and the requirements of any state anti-retaliation laws related to legal marijuana use, and implement personnel policies accordingly.  And as always, review individual contract terms and conditions carefully to identify any specific clauses that may govern.