Medical Marijuana, Part 5: Practical Considerations in Employment Litigation

The Legal Intelligencer

(by John McCreary)

Within days of the publication in the August 16, 2021 Legal Intelligencer of the last installment of this occasional series on Pennsylvania’s Medical Marijuana Act (MMA), the Superior Court affirmed Judge William J. Nealon’s decision – discussed in that article — that the  MMA does provide for a private right of action by medical marijuana patients claiming discrimination in employment. Palmiter v. Commonwealth Health Systems, 260 A.3d 967 (Pa.Super. 2021). Rejecting the contention that exclusive jurisdiction over enforcement of the MMA lies with the Department of Health, the Court stated that “[a]lthough the General Assembly did not expressly create a private right of action on behalf of an employee whose employer discriminates against her for medical marijuana use, it proclaimed a public policy prohibiting such discrimination. See 35 P.S. § 10231.2103.” 260 A.3d at 973. Beyond acknowledging the existence of the claim, however, the Court did not provide any specific guidance to either patients or employers concerning their rights and obligations under the statute. It acknowledged generally that:

[T]he same section of the statute [that creates employment protections for patients] also explicitly sets forth the rights of employers, i.e., that an employer is not required to provide an accommodation for certified users and may discipline employees who are under the influence of medical marijuana in the workplace. See § 2103(b)(2). Thus, in the employment context, § 2103(b) of the MMA not only delineates the rights afforded employees who are certified users, but also sets forth the rights of employers to discipline employees who are in violation of the terms of certified use.

260 A.3d at 975. The Court also noted that the MMA does not provide a specific remedy, id. at 975, and with its affirmance of Judge Nealon’s decision it appears to have implicitly adopted that jurist’s conclusion that an aggrieved employee could “seek to recover compensatory damages from an employer that violates Section 2103(b)(1).” Id. at 972.

Ms. Palmiter’s victory now raises additional issues for counsel for patients and employers to grapple with. First, for both sides in the litigation, is how to determine the available remedies? The Superior Court noted the absence of statutory remedies, as did the author in the first installment of this series. The author in that same article also remarked on the absence of a fee shifting provision in the MMA; unlike most anti-discrimination enactments the successful MMA plaintiff must pay her lawyer out of the proceeds collected by settlement or judgment. In the author’s experience defending claims brought under the MMA usually means that plaintiffs are amenable to quick settlements.

Should the case not settle quickly, what damages are available? The Palmiter decisions suggest that “compensatory damages” are appropriate. What are compensatory damages in the context of a wrongful discharge (or refusal to hire) under the MMA? Carlini v. Glenn O. Hawbaker, Inc., 219 A.3d 629 (Pa.Super. 2019) provides some guidance. In that case the plaintiff sued for wrongful discharge in violation of public policy, claiming among other torts that she was terminated in retaliation for filing a workers’ compensation claim. Both sides appealed the damage verdict. With respect to the wrongful discharge claim, Superior Court concluded that Carlini was entitled to recover her economic loss, consisting of lost wages and benefits, and so affirmed the verdict for those damages. 219 A.3d at 645. The trial court, however, had refused to instruct the jury that it could award Carlini non-economic damages for emotional distress and embarrassment. Superior Court found this to be error and remanded for a new trial on this measure of damages:

“Compensatory damages that may be awarded without proof of pecuniary loss include compensation … for emotional distress.” Restatement (Second) of Torts § 905 (Am. Law Inst. 1975); see also  Bailets v. Pennsylvania Tpk. Comm’n, 645 Pa. 520, 181 A.3d 324, 333 (2018) (stating that “our jurisprudence has long recognized non-economic losses are actual losses” (citations omitted)). “Damages for nonpecuniary harm are most frequently given in actions for bodily contact and harm to reputation …, but they may also be given in actions for other types of harm[.]” Restatement (Second) of Torts § 905 cmt. a (citations omitted).

“In Pennsylvania[,] one who is liable to another for interference with a contract is liable for damages for the emotional distress which is reasonably expected to result from the wrongful interference.” Kilpatrick v. Delaware Cty. S.C.P.A., 632 F. Supp. 542, 550 (E.D. Pa. 1986) (citation omitted); see also  Pelagatti v. Cohen, 370 Pa.Super. 422, 536 A.2d 1337, 1343 (1987) (quoting the Restatement (Second) of Torts for the proposition that “actual damages” for interference with a contract include, among other things, emotional distress if it is reasonably to be expected to result from the interference). “The victim of a wrongful termination, therefore, also should be entitled to recover damages for emotional distress reasonably expected to result from the wrongful discharge.” Kilpatrick, 632 F. Supp. at 550.

219 A.3d at 644-645 (footnote omitted). The Court also recognized that punitive damages were available under appropriate circumstances but remanded for a new trial on this issue because of error in the trial court’s admission of evidence of the net worth of the defendant. Id.

With the availability of compensatory damages for economic and non-economic injuries, as well as punitive damages, employers and their counsel should be judicious with their management of employees or applicants who lawfully use medical marijuana. This means, at least under the present state of the law in Pennsylvania, that employment decisions should be based on a patient’s use of marijuana and not on her status as a medical marijuana patient. The distinction between status and actual use is, at present, significant under the (dictum?) of Harrisburg Area Community College v. PHRC, 245 A.3d 283 (Pa.Cmwlth. 2020) (HACC), which was discussed at length in the previous installment of this series. In brief, Commonwealth Court interpreted section 2103(b)(1) of the MMA in a manner that does not prevent the employer from terminating or refusing to hire because of use of marijuana. This in turn counsels care in drafting and explaining personnel decisions. HACC is at present the latest word on the issue from an appellate court in Pennsylvania. The author is confident that Commonwealth Court’s parsing of the statute is correct as a matter of interpretation but is less confident that the Supreme Court will accept a construction that would, in effect, render the employment protections of the MMA illusory.

Additionally, employers need to be cognizant of the MMA’s recognition, however ambiguous and uncertain, of the potential safety risks presented by employees who use medical marijuana. See 35 P.S. 10231.510. Employers should identify jobs that are “safety sensitive” and consider in advance whether medical marijuana use is consistent with safe job performance. Ideally, employers will obtain an opinion from an occupational medicine practitioner, substance abuse professional or safety expert to bolster their opinion that certain jobs should be off limits to medical marijuana patients. Cf. Action Industries, Inc. v. PHRC, 102 Pa.Cmwlth. 382, 388, 518 A.2d 610,613 (1986) (“in cases of disparate treatment based upon handicap or disability, an employer can have a good-faith defense which negates its intent to discriminate where it reasonably relies upon the opinion of a medical expert in refusing to hire an applicant”).

Finally, the Palmiter Court’s conclusion that a private cause of action is available to vindicate the public policy codified in the MMA’s anti-discrimination provision suggests an additional defense applicable to employees covered by a collective bargaining agreement or employment contract containing an arbitration provision. In Phillips v. Babcock and Wilcox, 349 Pa.Super. 351, 503 A.2d 36 (1986) Superior Court held that wrongful discharge actions to vindicate public policy (in that case, retaliation for filing a workers’ compensation claim) were not available to unionized employees:

Finally, in deciding not to extend the wrongful discharge action to employees who are otherwise protected by contract or statute, we must take into consideration the strong public policy which favors the right of parties to enter into contracts. In the instant case, the union and appellee in their agreement decided the remedies that would be available, and provided that those remedies would be final and binding. This intent is expressly set forth in the agreement and, therefore, the remedies available should be preclusive of any others. Aughenbaugh v. North American Refractories Company, 426 Pa. 211, 231 A.2d 173 (1967).

349 Pa.Super. at 355, 503 A.2d at 38. See also Ross v. Montour Railroad Co., 357 Pa.Super. 376, 516 A.2d 29 (1986) (same).

Palmiter answers the issue of whether patients can sue to vindicate their employment rights, but there still remain many unanswered questions under the MMA. Employees and employers need a final answer from the Pennsylvania Supreme Court as to whether use of medical marijuana is protected under the statute, or only status as a patient. Employers need an interpretation of the safety-related provisions of the act so that they can make employment decisions free from the ambiguities created by those provisions. The author is therefore confident that there will be a sixth installment of this series.

For the full article, click here.

Reprinted with permission from the January 28, 2022 edition of The Legal Intelligencer© 2022 ALM Media Properties, LLC. All rights reserved.