Executive Summary: On April 22, 2026, the U.S. Department of Justice (DOJ) issued a final order (“Final Order”) placing FDA-approved drug products containing marijuana and medical marijuana products lawfully manufactured, distributed, and dispensed under a state-issued medical marijuana license in Schedule III of the Controlled Substances Act (CSA). The CSA defines Schedule III drugs as those with a potential for less abuse than the drugs/substances in Schedules I and II, which have a currently accepted medical use, and for which abuse may lead to moderate or low physical dependence or high psychological dependence. Examples of Schedule III drugs include Tylenol with codeine, ketamine, anabolic steroids, and testosterone. Any entity holding a state-issued medical marijuana license will be able to use a new expedited review process to register with the DEA as a marijuana manufacturer, distributor, or dispenser. Importantly, the Final Order is limited to medical marijuana activity and does not broadly legalize marijuana for recreational use under federal law, even where state law does.
While narrower than making all marijuana use legal under federal law, the change effectuated by the Final Order will likely affect how employers should evaluate medical marijuana use under federal, state, and local employment laws and their policies.
Affected Employment Laws and Practices
The Americans with Disabilities Act and Similar State and Local Laws
The Final Order is likely to have one of the greatest impacts on employers with respect to the Americans with Disabilities Act (ADA) (and § 504 of the Rehabilitation Act for those employers receiving federal financial assistance) and under some state/local laws that protect disabled employees. The ADA specifically excludes from protection those employees engaged in the “illegal use of drugs,” defined by reference to the CSA. With lawfully obtained medical marijuana now a Schedule III substance, it is no longer “illegal.” Employers will likely be required to make the same reasonable accommodations for employees with a medical marijuana prescription that they make for other employees using any other lawfully obtained medication for medicinal purposes. This involves engaging employees in the interactive process, ensuring that they are lawfully using marijuana for medical purposes, assessing their needs on an individualized basis, and reminding them that working impaired is not permitted, especially in safety-sensitive positions.
Drug Testing
The Final Order does not impact an employer’s ability to conduct drug testing or an employer’s policy prohibiting employees from being impaired or under the influence at work or while working. It also does not preclude employers from having zero-tolerance policies, prohibiting recreational or other illegal marijuana use, or possessing marijuana while on work premises. Employers must also continue to enforce safety-based standards. However, drug testing for marijuana use does not distinguish between medical and recreational use, nor can it determine current impairment as opposed to recent marijuana use. A positive marijuana test alone, therefore, should prompt further questions by an employer to determine the reason for the marijuana use and whether it is being lawfully obtained for medical purposes, as opposed to being an automatic employment disqualifier or disciplinary issue. A positive test may also reveal that an employee is disabled, sparking the employer’s obligations under the ADA and state/local laws that protect employees with disabilities.
Department of Transportation (DOT) Regulated Employees
For DOT-regulated employees working in safety-sensitive positions, such as truck drivers, airline pilots, bus drivers, pipeline workers, and train operators, to name a few, the rules have not changed, at least for now. The DOT continues to prohibit all marijuana use for these positions.
Drug Free Workplace Obligations for Federal Contractors
The Final Order does not affect the Drug Free Workplace Act, which requires federal contractors to ensure that the workplace is free of illicit drugs and the unlawful use of legal drugs. The Final Order, however, now makes legally obtained medical marijuana use lawful. Employees employed by a federal contractor who lawfully use medical marijuana should be treated the same as any other employee using any other Schedule III drug.