- within Energy and Natural Resources topic(s)
- with Senior Company Executives and HR
Takeaways
- The New Jersey Appellate Division in Sanders held that the state’s cannabis statute allows an aggrieved individual to bring a private lawsuit in a court of law.
- Employers should ensure their current practices and policies are compliant with the law’s anti-discrimination provisions, which prohibit taking an adverse employment action against an employee or refusing to hire an individual because of their use or non-use of cannabis.
Until the New Jersey Appellate Division’s decision in Sanders v. The Levari Group, d/b/a First Choice Freezer[MS1] , No. A-2715-23 (May 26, 2026), it was unclear whether an individual could bring a private lawsuit alleging discrimination in violation of the state’s cannabis law, the Cannabis Regulatory, Enforcement Assistance, and Market Modernization Act (CREAMMA). The Appellate Division recently held that individuals who allege to have suffered adverse employment actions because of their use of cannabis could bring a claim of violation of CREAMMA in court.
Notably, the U.S. Court of Appeals for the Third Circuit held in a 2024 decision that CREAMMA did not create a private right of action.
Legislative History
In November 2020, the New Jersey Legislature amended the New Jersey Constitution to legalize recreational cannabis use by individuals aged 21 and over.
On Feb. 22, 2021, the Legislature enacted CREAMMA, which aimed to control and legalize the use of cannabis like the state’s regulation of the use of alcohol. The Cannabis Regulatory Commission (CRC) was created and tasked with regulating the use of cannabis in the state.
CREAMMA also includes anti-discrimination provisions, prohibiting employers from failing to hire, discharging, or otherwise subjecting an individual to an adverse employment action because of the individual’s legal use of cannabis.
Although CREAMMA authorizes the CRC to take enforcement action or impose sanctions on an entity licensed to sell cannabis, the CRC’s regulations do not contain any procedures for enforcement actions against unlicensed individuals or entities.
Sanders Decision
In Sanders, Darlene Sanders alleged that, after accepting a position with the employer, she was required to take a drug test. Her test results were positive for cannabis. When she contacted the HR department to inquire about her start date, they “offered [her] the opportunity to submit to a repeat drug test.” When she failed to take another test, the employer rescinded the employment offer and refused to hire her.
The Superior Court dismissed the plaintiff’s Complaint, finding no evidence the Legislature meant to create a private right for individuals to bring lawsuits to enforce CREAMMA. The plaintiff appealed, and the Appellate Division reversed the lower court decision in a matter of first impression. The court held CREAMMA provides individuals a private right of action for adverse employment actions because of their use of cannabis.
What This Means for Employers
Employers should review their hiring practices and policies, as well as their employee handbooks and other relevant policies, to ensure compliance with CREAMMA’s provisions. Further, employers should ensure that all employment decisions are based on legitimate, non-discriminatory reasons and, specifically, not an individual’s use of cannabis.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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