Governor Newsom has signed AB 2188¹ into law that will create anti-discrimination protections for individuals that use cannabis while off duty and away from the workplace, with exceptions for certain industries, such as building, construction and those subject to federal drug testing regulations.

Importantly, AB 2188 will not permit employees to possess, to be impaired by, or to use, cannabis on the job, nor will it affect the rights or obligations of an employer to maintain a drug-and alcohol-free workplace. Rather, the new law will prevent employers from punishing employees or refusing to hire applicants based on off-duty cannabis use, or for failing a drug test that found the person to have nonpsychoactive cannabis metabolites in their system.

While AB 2188 does not go into effect until January 1, 2024, California employers will want to use the next 15 months to ensure their drug testing processes and drug-and-alcohol policies comply with the new provisions of AB 2188. Here are some things California employers should know and consider as they prepare for this new law.

Will AB 2188 Apply To All California Employees?

No. AB 2188 will not apply to employees in the building and construction trades, and will not apply to applicants or employees hired for positions that require a federal government background investigation or security clearance.

In addition, the new law will not preempt state or federal laws requiring applicants or employees to be tested for controlled substances, including laws governing federal contractors or employers receiving federal funding or federal licensing-related benefits. Nor will AB 2188 affect the rights or obligations of an employer to maintain a drug-and-alcohol-free workplace, as specified in Section 11362.45 of the Health and Safety Code, or any other federal law or regulation.

Although not expressly stated, the statute’s reference to federal regulations appears to be aimed at those industries subject to certain federal drug testing requirements, such as aviation, railroads, trucking, or maritime, all of which are subject to federal regulations administered by the U.S. Department of Transportation.

What Are Nonpsychoactive Cannabis Metabolites?

The provisions of AB 2188 focus on how an employer determines an employee is impaired by tetrahydrocannabinol (“THC”) while on the job.

THC is the chemical compound found in cannabis that can indicate impairment and cause psychoactive effects—it is what makes people feel “high.” After THC is metabolized, it is stored in the body as a nonpsychoactive cannabis metabolite—a metabolite that does not indicate impairment, only that an individual has recently consumed cannabis.

The presence of nonpsychoactive cannabis metabolites can vary depending on the route of consumption, oral consumption or inhalation, and among occasional or chronic users. So, as noted by the California Legislature, “the presence of the nonpsychoactive cannabis metabolite [has] no correlation to impairment on the job.”

Covered employers must understand the substances for which they are testing. Starting in 2024, any adverse employment actions taken against employees or applicants based on drug tests screening for nonpsychoactive cannabis metabolites could lead to claims of discrimination and/or wrongful termination.

How Does AB 2188 Change California Law?

AB 2188 will add Section 12954 to the California Government Code and serves as an amendment to the state’s anti-discrimination laws, known as the California Fair Employment and Housing Act (“FEHA”). The FEHA prohibits various forms of employment discrimination based upon a number of protected categories, including, a person’s race, religious creed, color, national origin, ancestry, physical or mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, or veteran or military status.²

Beginning on January 1, 2024, AB 2188 will add to that list by making it unlawful for an employer to discriminate against a person in hiring, termination, or any term or condition of employment, or otherwise penalize a person, if the discrimination is based upon either:

1. The person’s use of cannabis off the job and away from the workplace; or
2. An employer-required drug screening test that has found the person to have nonpsychoactive cannabis metabolites in their urine, hair, blood, or other bodily fluids.

Notably, AB 2188 does not make a distinction between medical cannabis use and recreational cannabis use, both of which are legal in California.

California voters passed Proposition 215 in 1996 and became the first state to legalize the medicinal use of cannabis. Two decades later, voters passed Proposition 64—a voter initiative that legalized recreational use of cannabis in the state. However, the state did not establish workplace protections for off-duty cannabis use, even for medicinal purposes. In fact, in 2008, the California Supreme Court held that California employers were not required to accommodate an employee’s off-duty use of medical cannabis and could take cannabis use into consideration when making employment decisions; finding that Prop 215 was not intended “to address the respective rights and duties of employers and employees.”³

Although AB 2188 does not take effect until 2024, California employers should be aware that it has the potential to change various aspects of employment law, including with respect to an employer’s obligations to accommodate off-duty cannabis use for medicinal purposes or to otherwise treat a mental or physical disability.

How Does AB 2188 Change Pre-Employment Drug Testing?

Employers may still require pre-employment drug testing as a condition of employment, except the testing method used cannot screen for nonpsychoactive cannabis metabolites.

According to the California Legislature, due to advancements in science, “employers now have access to multiple types of tests that do not rely on the presence of nonpsychoactive cannabis metabolites,” including “impairment tests, which measure an individual employee against their own baseline performance and tests that identify the presence of THC in an individual’s bodily fluids.”

Urine tests are currently the most commonly used drug test by employers, which screen for nonpsychoactive cannabis metabolites and can detect cannabis in the body days or weeks after its consumed. This, however, is far from detecting whether an individual is impaired on the job or at the time of the drug test.

Employers that utilize pre-employment drug testing have until January 1, 2024, to transition to a drug test that complies with the provisions of AB 2188.

How Should California Employers Prepare For AB 2188?

AB 2188 is scheduled to take effect on January 1, 2024. In the meantime, employers should review and consider revising their drug and alcohol policies to ensure compliance with the provisions of AB 2188. This includes specifically forbidding on-duty cannabis use and impairment, as well as defining what it means to be “off the job and away from the workplace,” which may have changed in the minds of many employees due to the rise of remote and hybrid work arrangements.

Furthermore, employers that utilize drug testing need to review their current testing practices to determine if their method of drug testing screens for nonpsychoactive cannabis metabolites, and if so, transition to a drug test that does not.