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Medical marijuana ruling a victory for employers

Posted On: Jun. 21, 2015 12:00 AM CST

A Colorado Supreme Court ruling upholding Dish Network's firing of a worker for smoking marijuana outside of work is a victory for employers, particularly in reinforcing the principle of a drug-free workplace.

While several workers compensation professionals said the ruling could be a major one in allowing employers to reject medical marijuana as a compensable treatment for injured workers, others say its impact may be more limited. In addition, sources expect more injured workers to seek to use the substance that is illegal under federal law.

In Brandon Coats v. Dish Network L.L.C., the former telephone customer service representative for Englewood, Colorado-based Dish Network argued that he was wrongfully fired in 2010 for using legal medical marijuana outside of work.

Despite Mr. Coats' argument that he was legally registered under state law to use marijuana due to “painful muscle spasms caused by his quadriplegia,” the Colorado high court last week ruled unanimously that workers who engage in activities permitted by state law but not federal law are not protected by Colorado's “lawful activities statute.”

Colorado is one of 24 jurisdictions that have legalized medical marijuana and one of five that have legalized marijuana for recreational use.

“This (ruling) is a resounding victory for employers, not only in Colorado, but those that are concerned about the expansion of this principle in other states,” said Albert B. Randall Jr., Baltimore-based principal at Franklin & Prokopik P.C. “Employers are going to be somewhat emboldened to continue following their existing drug and alcohol policies in light of this decision,” especially considering that “Colorado has a statute, which many states don't have, protecting lawful behavior off (work) hours.”

Had the Colorado court shown more tolerance for workers' use of medical marijuana, this would have been a turning point, he said.

“(The ruling) is not necessarily going to change anything when it comes to workers compensation remedies,” he said. “Workers compensation, being a state-by-state statutory scheme, run under state law — that's probably going to lead to more results like the New Mexico result.”

In that January case, Miguel Maez v. Riley Industrial and Chartis, the New Mexico Court of Appeals ruled that medical marijuana should be classified as “reasonable and necessary medical care” and paid for in the case of a New Mexico man's workers compensation claim in two 2011 back injuries.

By April, Arizona H.B. 2346 was signed into law, allowing workers compensation insurers and self-insured employers in Arizona to deny payment for medical marijuana.

“Most employers are suggesting they're not going to pay for this under comp (and) most carriers are saying they're not going to pay for this under comp,” said Darrell Brown, Long Beach, California-based chief performance officer at Sedgwick Claims Management Services Inc. “That's probably the right thing to do since the treatment guidelines don't” recommend it for injured workers.

“More important than the cost element is whether or not the marijuana really is effective for treating medical conditions,” said Trey Gillespie, senior workers comp director in Austin, Texas, at the Property Casualty Insurers Association of America.

Workers compensation payers don't want to reimburse workers for any treatment that doesn't lead to functional improvement, he said.

Unlike the employment side, where drug-free workplace and zero-tolerance policies reign supreme in the courts, a corporate policy might not be enough to keep workers comp payers from having to reimburse injured workers for medical marijuana, said Tom Ryan, workers compensation market research leader of Marsh L.L.C.'s Workers' Compensation Center of Excellence in New York.

Mr. Brown said there will likely come a time when a payer will “decide how far do they want to take it, or does it make sense to go ahead and pay for it? They need to prepare for that.

“My guess is when lots of these (medical and recreational marijuana) laws were written, they weren't really thinking about workers compensation,” Mr. Brown said. “On the medical marijuana side, it's a stay-tuned kind of thing. With more states moving toward it, you'll find more injured workers saying, 'I need it for my workers compensation injury.'”