Illinois is embarking on a grand public policy experiment starting Jan. 1, 2020 when it legalizes the sale, use and possession of recreational marijuana. Like all public policy experiments, there will be good and bad unintended consequences that impact Illinois employers.
Illinois has seen real improvement in its workers' compensation rates over the past two years. Legalization of cannabis may stop this positive trend in its tracks. In 2016, Illinois had the 8th most expensive workers' compensation rates in the country, and the highest in the Midwest. Currently, Illinois' rates are 22nd most expensive in the country with Wisconsin's rates significantly higher than Illinois.
In January 2014, Colorado became the first U.S. state to allow retail sales of recreational marijuana. According to a Colorado study, the legalization of retail sales of marijuana was associated with a 6.0% increase in insurance collision claims for the period of January 2012 through December 2016.
Automobile accidents increased in Colorado after it legalized recreational marijuana. Might there also be more workplace accidents in Illinois as a result of legalized recreational marijuana?
Counter intuitively, the legalization of recreational marijuana may result in more drug testing, not less. Three factors suggest that Illinois employers might start drug testing employees more often than they did prior to legalization. First, in Colorado, one survey found that after Colorado legalized recreational marijuana, 86% of employers did not change their drug testing policy, 3% implemented a drug testing policy for the first time, and 4% made an existing drug testing policy more stringent. This is to be compared to 5% of Colorado employers who relaxed their drug testing policy as it pertains to marijuana.
Second, with the advent of "oral fluid specimens," or saliva testing, drug testing has gotten easier, less invasive, less expensive, and more accurate. Estimates are that saliva collection costs between $38 to $114 less per test than urine collection. Previously, urine testing was inconvenient for employers. Employers may be more inclined to administer drug tests given how easy saliva testing is.
Finally, the safe harbor provision for Illinois employers set forth in the Cannabis Regulation and Tax Act ("Act") is replete with references to drug testing. The Act allows employers to adopt employment policies concerning drug testing and employers are allowed to fire employees who refuse to take drug tests. Most employers who are concerned about recreational marijuana usage affecting their facility will want the backstop of a positive drug test.
On the positive side, perhaps the legalization of recreational marijuana will help Illinois employers combat Illinois' labor shortage. Illinois is one of 11 states with historically low unemployment rates. In Illinois, there are 0.9 people looking for work for each open job. Illinois needs more employees. The legalization of recreational marijuana should make it easier for Illinois employers to hire job applicants with prior convictions for substance abuse.
Finally, the legalization of recreational marijuana may detrimentally affect the health of Illinois employees and drive up group health insurance rates. Illinois is the 26th healthiest state in the country. Increased marijuana usage will not improve that score and will likely push it lower. Research on marijuana has been stymied by the fact that it remains an illegal Schedule 1 controlled substance under federal law. The general consensus is, however, that there is a statistical association between maternal cannabis smoking and lower birth weights, cannabis use and the development of schizophrenia or other psychoses, and cannabis use and more frequent bronchitis.
Unintended consequences are no reason not to do something. But when it comes to recreational marijuana, the real impact of this new public policy may not be realized for 20 years. Serious unintended consequences may arise and hurt Illinois employers.
• Ross I. Molho is a partner at Clingen Callow & McLean, LLC in Lisle.