Variations in legalization of recreational and medical marijuana is creating confusion, indecision and in many cases, non-compliance with contractual terms. What to do?
Long before third party risk management became a hot topic, RFPs and other qualification and selection processes included due diligence on third parties' drug testing policies and practices. During contracting, third parties were bound by stringent, and in some cases explicit requirements. Some buyers are attempting to maintain outdated practices, either because they haven't yet made changes to reflect changes in laws, or because a drug-free workplace is in alignment with corporate policies and their reputation.
Across North America, employers have had relatively broad powers to conduct drug testing to pre-screen prospective employees and test existing ones for almost 20 years. Drug testing came into practice in the U.S. in 1988 when Reagan signed the Drug Free Workplace Act. Since that time, drug testing has been widely administered.
Canada's Controlled Drugs and Substances Act became law in 1997, replacing earlier statutes. Despite having the power to administer work-related drug tests, this practice is less common in Canada, likely due to national culture combined with privacy laws.
In the U.S., conflicting marijuana laws are creating confusion, indecision and in some cases, inaction. In the US, Medical marijuana is legal in more than half of the United States. Recreational marijuana is legal in four states. Regardless, marijuana remains illegal under the federal controlled Substances Act.
In Canada, medical marijuana is legal but recreational marijuana is not. 2017 will see a vote on legalization of recreational marijuana. Regardless of the outcome, historically Canada has been tolerant of marijuana for recreational purposes.
This patchwork of laws means companies with prescriptive drug testing requirements, including contractual obligations, will need to change their approach. Lighten up on stringent requirements. Drug testing requirements should stipulate "illegal substances", not stipulate which illegal substances. A good attorney can craft language to clarify the intent of drug testing, placing the onus on the third party for appropriate execution.
The combination of "right to hire" legislation, clear contractual language regarding replacement of personnel, effective SLAs and active performance management go a long way to protecting your institution and its operations. You're better off spending scarce resources improving background checks on third-party personnel, and yours too. Criminals and malicious hackers can do far more harm that an impaired worker.
Procurement Officer in three major banks, Linda brings practical, hands-on expertise to help her clients design, assess and strengthen their risk management and procurement functions. Linda can be reached at firstname.lastname@example.org
Linda will be presenting with TD Bank at the upcoming SIG Global Summit this March 13-16 in Amelia Island, Florida on Run with the Best: A Risk-Based Approach to Third Party Risk Management. Attendees can expect to learn how to build a roadmap for your program, business benefits and the risk of not investing, current and emerging best practices of third party risk management programs and tips for stakeholder engagement and program adoption.