An Employer's Guide to Employee Drug Screening

Every employer has the right to maintain a drug-free workplace. Even federal employment has an employee drug screening requirement. In some industries, such as transportation, drug screening is a mandatory part of safety measures imposed by the government. Ultimately, the goal of testing and screening programs in the workplace is not to unfairly bar individuals from employment opportunities. After all, some federal laws stipulate that denying someone a job based only on a history of substance abuse isn't permissible. The purpose of a thorough background check and drug screening program is safety, whether as part of pre-employment procedures or maintaining a sober workplace.

Implementing a system that works for your business requires more than setting up an agreement with a third party to help you process and interpret the results of employee drug screens. There are many considerations, from which laws you may need to follow to what type of drug tests you choose to use. How relevant is workplace drug testing in 2023? At a time when regulatory environments and social attitudes around specific drugs are changing significantly, there are even decisions to make about which drugs you will consider disqualifying. 

To use these tools successfully and avoid the risk of lawsuits or regulatory action, employers must understand their rights and responsibilities under local, state, and federal law. For employers in regulated industries, there are even more elements to consider. Exploring the facts and catching up on what you need to know will help you create a drug testing policy that is fair, functional, and reliable.

What the Law Says

Ensuring compliance with the law is essential, especially when drug testing. There can be stiff penalties for violating the law, and there is always the potential for a civil lawsuit from affected individuals. Employers must apply a consistent policy across their entire company. In other words, if you intend to drug test an individual job applicant, you must test them all. Singling out an individual for a drug test could, in some circumstances, be considered discriminatory. Therefore, a repeatable and verifiable business process based on the law is crucial.

What laws do you need to follow? That will depend on your jurisdiction. While some federal laws apply to drug tests (more on those below), most often, this is an area where states choose to exercise their own prerogative to set standards and requirements. Some states don't place any of their own restrictions on employers at all, such as in Texas. Other states may regulate specific industries and demand drug tests, such as for those who will work in a childcare setting. Therefore, the best place to begin understanding what you can and cannot do is to explore our roundup of each state’s laws on pre-employment drug testing from 2022. 

Our guide will give you a baseline understanding of what your business may consider during the hiring process. With more jurisdictions beginning to change tack on subjects such as marijuana drug tests, your business should stay up to date on all the latest developments. Don't be caught off guard by regulatory changes that could impact how your company selects, vets, and hires candidates. 

Aside from state-by-state drug testing laws, what other important legislation should you keep in mind?

The Controlled Substances Act

How does the government determine whether a drug is illicit or not? How do employers decide when drug use not covered by a legitimate medical condition should be a disqualifying factor? For decades, the answer has been to follow the Controlled Substances Act. This federal law divides all drugs regulated by the government into five “schedules” based on each drug's risk for abuse and its accepted medical uses. For example, heroin is a “Schedule I” drug along with LSD and ecstasy because they have a high potential for abuse and few other uses. Many employers used the Controlled Substances Act as a guide—positive tests for Schedule I drugs were usually seen as making a candidate too risky to hire.

In today's environment, relying on the CSA is not always the best action. Changing marijuana laws contributes to confusion and legal concerns nationwide, leaving many employers unsure of whether testing for cannabis is still worthwhile. Even so, marijuana drug tests remain a standard part of the hiring process in many places purely because cannabis remains a Schedule I drug, according to the federal government. Famously, cannabis is a Schedule I drug despite dozens of states legalizing its medicinal use—not to mention recreational legalization. 

In 2016, the DEA declined to reschedule marijuana despite activist pressure and a growing legalization movement at the state level. However, executive orders by President Joe Biden issued in 2022 directed the government to begin the years-long process of reviewing the CSA’s cannabis classification and scheduling. The result of these actions could mean the drug eventually moves to a different schedule classification. It is not hard to imagine a future where marijuana is no longer federally illegal, especially as these actions accompanied a blanket pardon for many low-level marijuana offenses. 

While disqualifying applicants for heroin, cocaine, and other substances remains commonplace, attitudes about cannabis usage outside the workplace continue to change. So, relying solely on the Controlled Substances Act to decide your testing policies may no longer be the best move.

Expungement

As an employer, you may choose to look beyond the results of a drug test for additional evidence of bad habits and patterns of behavior surrounding drug use. This may include reviewing criminal background checks for evidence of drug-related crimes, such as possession or sale. In doing so, however, it’s vital to be aware that criminal record expungement can put those records out of reach and make it illegal for you to consider them. 

Even if a criminal background check reveals an expunged record, employers may not factor that information into their decision. In 2021, new marijuana expungement laws took effect in two states, and there is a vigorous nationwide movement to expunge marijuana convictions more broadly. In the wake of President Biden’s 2022 executive orders, governors in several states, such as Oregon, were inspired to take additional action. In that state, more than 45,000 offenders had their records wiped clean of minor cannabis-related charges. Other states may soon follow suit. 

Expunged records must be treated as though they don’t exist and the related crimes never happened; consumer reporting agencies work hard to keep these records out of results, but employers should remain aware that many states now allow individuals to expunge marijuana convictions. These trends, combined with spreading legalization, mean many employers have begun reconsidering the importance of cannabis use among workers rather than risk potential legal consequences for unfairly considering past usage.

Industry-Specific Requirements

These extra drug testing demands often apply to industries where substance abuse would create more extreme risks to the business or the public than usual. Some industries face specific rules and regulations surrounding drug use that do not apply to other sectors. This situation is similar to how some industries may require specific background checks rather than leaving it to employers to decide on using them. 

While a clothing retailer may not care if someone uses marijuana during their off hours, the same attitude is not best applied to someone charged with operating heavy machinery weighing dozens of tons. That is why most industry-specific requirements often apply to the transportation sector and its employed drivers. Similarly, a fast-food restaurant might not worry much about drug test results, but what about a hospital pharmacy tasked with protecting valuable and controlled substances? In these scenarios, a drug test is an important line of defense. Spotting red flags at this stage could prevent opening the door to crimes of opportunity later.

However, with the spread of medical and recreational cannabis legalization, new industries around drugs have begun to develop. Some of these industries have identified a need to place regulations for fairness and safety, especially after questions arose surrounding the impact of previous prohibition laws. Let's look at three areas where employers in specific sectors must be aware of their additional obligations under the law. 

In the Cannabis Sector

With the proliferation of medical and recreational cannabis markets, the need for large-scale domestic growing and selling operations has spiked dramatically. With many companies now operating in this space, employers face a unique challenge: what role should a background check and drug screening play here? Marijuana prohibition enforcement has a history of disproportionately affecting the poor and minorities, and some activists see the industry as a means of extending new opportunities in a restorative effort. There are many initiatives throughout states with legal cannabis to ensure that such opportunities continue to exist for these groups.

In Regulating a "Growing" Industry: The Role of Background Checks in the Cannabis Sector, we examined the unique pressure facing this space as it expands nationwide. In most cases, cannabis-industry employers continue to find criminal background checks and drug tests useful tools. The differences often lie in interpreting and applying the results of such due diligence. Some states have already enacted background check requirements to protect the purity of harvests and the safety of those working together.

For companies in the cannabis sector, employment law compliance is one more area that requires careful attention to detail. Other states have created rules that explicitly disallow denying cannabis sector jobs to those who test positive for THC usage or who have prior cannabis-related convictions. Such jurisdictions still require background checks and screening for other drugs, but employers cannot consider specified information even if they become aware of it.

In the Psilocybin Sector

Cannabis isn't the only previously illegal drug undergoing a resurgence of interest and research. Some states, including Oregon and Colorado, have taken steps to legalize psilocybin. This is the psychoactive compound found in ‘magic mushrooms’. In areas where the substance is now legal, lawmakers face tough questions about regulating producers and distributors of psilocybin safely and smartly. Advocates and scientists hope to see new opportunities for using psilocybin as a treatment for mental illness. 

Ultimately, they enacted a ban the box law to provide fair opportunities and barred consideration of any singular drug offenses older than two years. Employers in this fledgling sector should take care to familiarize themselves with the rules surrounding hiring and vetting applicants to work around psilocybin. As the industry develops, lawmakers may see an additional need to revisit these regulations.

Additionally, businesses, in general, should be wary of how they evaluate positive drug tests for psilocybin. Specific tests do exist, but most employers do not use them. If your company operates in an area where it is now an accepted medical treatment, you may not have the legal authority to deny applicants based on using a substance under the direction of a state-licensed doctor. However, most drug testing panels cannot detect psilocybin usage anyway—even extensive 12-panel tests don’t include the substance.

Rules for the Transport Industry

The transportation industry features strict regulations surrounding drug testing. This is one of the few areas where federal law speaks directly to the need for drug-free work in specific spaces. These businesses, including freight and passenger transport, all fall under the jurisdiction of the Department of Transportation. As such, they must follow the DOT’s rules and guidelines for hiring sober drivers and maintaining compliance. This includes a mandatory pre-employment drug test and a policy of random drug testing, a percentage of the workforce annually. No drug use is accepted by the DoT, including cannabis.   

In 2016, the Department of Transportation created a drug and alcohol clearinghouse to help transport providers know when drivers have a history of drug or alcohol use. All positive tests feed into this clearinghouse. Declined tests also appear in the database. Transportation employers must carefully review their compliance requirements and partner with a drug testing provider with a qualified Medical Review Officer on staff to interpret results. Hiring a driver with a recent or current positive test could create legal headaches for transport carriers. Always be thorough about your drug test and background check policies in this sector.

The Clearinghouse

At backgroundchecks.com, we founded the Expungement Clearinghouse to make it simpler to remain as up-to-date as possible on criminal record expungements. Working with a proactive consumer reporting agency that acknowledges the importance of expungement can yield significant benefits for your business. What is the Clearinghouse, and why did we create this initiative?

Expungement procedures for crimes, especially drug-related convictions, vary substantially from place to place. Sometimes, individuals don’t know they’re eligible to apply for record expungement. To broaden access to these important opportunities, backgroundchecks.com initially created MyClearStart, a way for job-seekers in several states to take an expungement eligibility test. This test would provide individuals with an assessment of their opportunities for expungement and information on the next steps.

One thing became clear through our experience with the MyClearStart program: there‘s a substantial disconnect between the expungement process and notifying consumer agencies of such expungement. We then took steps to establish the Expungement Clearinghouse. 

Today, with The Foundation for Continuing Justice, the Expungement Clearinghouse validates information about expungement orders. It transmits a notification to all Clearinghouse members instructing them to remove the expunged records from their databases. In this way, backgroundchecks.com ensures employers can reliably judge individuals on their merits while expanding access to job opportunities to those who've earned a second chance.

Building Your Company's Drug Screening Policy

How do you create an employee drug screening policy that works for your business, stays within the boundaries of the law, and provides you with helpful information? It takes a few steps—but once you've created your policy, it should be easy to repeat and follow well into the future. Barring any regulatory changes that impact your industry, your local area, or the specific considerations in a drug test, this is usually a process you only need to complete once. Where should you begin?

How can employers stand up for a drug testing policy that aligns with their own mission and values? There are numerous essential elements to consider. These include the type of drug test you will use, what kind of panel or screening you'll choose, whether you’ll need a medical resource officer's help, and what drugs you consider disqualifying.

Essential Elements

First, it is vital to understand the relationship between drug testing and the Americans With Disabilities Act. Remember that the ADA applies to all employers with 15 or more employees and stipulates that pre-employment drug screening is only permissible if you meet two conditions. First, all candidates—not just some—must undergo the testing. Second, you may only test after extending a job offer and making a negative test a condition of employment.

Other drug tests, such as random testing, should keep fairness central to the process. Always carefully review all the elements that add to your company's compliance with legal requirements.

A written policy defining how you will approach employee drug screening is another essential element. There should be no doubt about how your business tests applicants based on this policy. In the broadest sense, your policy should include information such as:

• Who undergoes testing
• When you will conduct testing
• Who will conduct the testing
• When and how you will use a Medical Review Officer or certified laboratory testing
• What drug panels you will run, and what substances you will test for
• What qualifies as a disqualifying positive test
• How you will ensure you don’t deny a position based on legitimate prescription medication
• When or if you will allow a second test for applicants
• How you will conduct testing on employees after hiring.

Review any local laws concerning past marijuana offenses if you work in a state with legal medicinal or recreational cannabis. 

Once you've established a written policy that remains within the boundaries of the law, you will also need to empower your organization to conduct drug screening without delaying the hiring process. Connecting with an experienced third party offering many types of drug tests makes this simple. Your partner can organize everything from sample collection to analysis and interpretation, ensuring your process remains agile even as it achieves greater depth.

What Does It Cost, and Who Pays?

“How much is this going to cost the business?” is one of the urgent questions an employer will have when considering integrating pre-employment drug testing in 2023 and beyond. Hiring is already a significant investment for every applicant a company chooses to employ. Concerns about the cost of drug testing aren't unwarranted, but there is little to worry about—these services are often highly affordable and easy to access. With backgroundchecks.com, companies can order everything from a 5-panel to a 10-panel test at an affordable price, with results for clean tests returned rapidly.

Generally, employers pay for drug testing job applicants and existing employees alike. In some states, such as Florida, it’s a statutory requirement for companies to pay for the drug tests they require—it’s illegal to demand that a job applicant pay. In other states, such as Texas, there are no such restrictions. There is no explicit federal guidance on the subject either. 

However, requiring applicants to pay for tests could discourage minorities or the underprivileged to apply. Most companies choose to pay for drug tests themselves to avoid the risks of inadvertent discrimination instead of shifting the burden to job seekers.

What about the time it takes to travel to a testing site to submit the drug test? Does an employer have to pay wages for this time? The answer is “yes”, but only for existing employees. For example, if an employee was selected for employee drug screening at random, they must be paid for the time to test by law. However, court rulings have determined that no such obligation exists for a pre-employment drug test. Because those with conditional job offers are not yet technically employees, no right to compensation exists.