Employers Urged to Be Careful Before Acting on Drug Test Results

A recent federal appeals court ruling against Airgas USA LLC related to a disabled worker’s disputed positive drug test result sends a warning to companies about exercising due diligence before taking adverse employment actions, attorneys say.

The US Court of Appeals for the Sixth Circuit’s Jan. 31 order rejected Airgas’ argument that it had an “honest belief” that employee Murray Fisher used marijuana because it relied on information from a third-party drug screening company.

The doctrine shields companies from liability for allegedly discriminatory employment actions if they offer legitimate reasons based on incorrect information that they reasonably trusted at the time.

Yet the rule—a business-friendly defense used to escape employment discrimination and retaliation claims that hinge on indirect evidence of bias—isn’t a golden ticket to avoiding liability.

“This defense has been gaining in popularity and recognized by the courts,” said Amy Epstein Gluck, chair of Pierson Ferdinand LLP’s employment practice group.

But “it’s been successful most often when the employer does a complete investigation,” she said. “Timing matters.”

Fisher, who was using a legal hemp product to treat cancer-related pain, asked for a retest after telling the company that the hemp had caused the false positive result. Yet Airgas never told the drug testing company that Fisher was using hemp, nor did it ask whether the product could cause the test to come up positive for marijuana—"even though doing so would have been as easy as sending an email,” the court said.

That was enough to reverse a lower court’s decision tossing Fisher’s claim that the company illegally fired him in violation of Ohio’s disability law, the appeals court held.

The opinion highlights the perils companies face if they ignore their employees’ side of the story and carry out decisions without a proper investigation, said Sean Mack, co-chair of Pashman Stein Walder Hayden PC’s cannabis and hemp practice.

“It really underscores for employers that they need to listen to their employees,” he said.

Discrimination Framework

The Seventh Circuit originally developed the honest belief doctrine through a series of employment cases applying the three-part burden-shifting framework set out in the US Supreme Court’s 1973 ruling in McDonnell Douglas Corp. v. Green. That decision allows an employer to give a legitimate reason for its actions that a plaintiff must prove is a pretext for bias in order to prevail.

The honest belief rule suggests that just because the employer was ultimately wrong, it doesn’t mean the reason for the action was pretextual and actually the product of illegal discrimination.

The rule, however, enforces the idea that employers must have legitimate, nondiscriminatory bases for an adverse action, Gluck said.

The Airgas case also has implications for employers trying to navigate a maze of evolving state marijuana legalization laws that grant certain protections to employees.

Ohio—where Fisher worked—late last year became the 24th state to legalize marijuana for recreational use. However, employers in the state aren’t required to accommodate a worker’s use or possession of marijuana, and they are allowed to discipline or fire an employee for using the drug if it violates a workplace policy.

Even where state laws permit such action, employers should be cautious when relying on third-party drug testing companies, especially as marijuana comes in various potencies, attorneys said.

“There is no one size fits all drug test,” said Sara H. Jodka of Dickinson Wright PLLC. The Airgas case demonstrates that “when you’re working with your vendors, you need to be very clear about what you want to test for,” she said.

“As an employer, you really do need to understand the language that your vendor is speaking and that is where we had a disconnect” in the case, Jodka said.

“They didn’t have that conversation prior to the results of the test and before firing the employee,” she said.

The case is Fisher v. Airgas USA, LLC, 6th Cir., No. 23-03286, unpublished 1/31/24.