You witness a group of your employees exit the workplace on their break, gather on a public sidewalk and begin to smoke what appears to be cannabis. How do you respond?

If the newly proposed legislation under consideration, Bill 36, An Act to enact a new Act and make amendments to various other Acts respecting the use and sale of cannabis and vapour products in Ontario (“Bill 36”), is passed, then your response will need to account for an entirely new set of rules from those effected under the former Ontario government.

Background

Bill C-45, the federal Cannabis Act, received royal assent on June 21, 2018, making certain activities regarding possession, cultivation and consumption of recreational cannabis legal effective October 17, 2018. Provincial governments have introduced additional legislation to regulate activities related to recreational cannabis legalization within their borders. In Ontario, the provincial government passed the Cannabis Act, 2017 and, more recently, introduced further legislation in the form of Bill 36.

Bill 36 has two primary components. First, it would permit smoking cannabis in places where smoking tobacco and using e-cigarettes is permitted, including in certain controlled areas of long-term care homes, hospices and designated guest rooms in hotels, motels and inns. Second, the measure would establish the Alcohol and Gaming Commission of Ontario (AGCO) as the provincial regulator authorized to grant store licences within a new private retail store model. Among other things, Bill 36 proposes to establish a regulatory framework for a private cannabis market and makes several amendments to existing law with foreseeable consequences to Ontario workplaces.

Bill 36 raises new questions for employers that demand thoughtful, proactive solutions in advance of cannabis legalization on October 17, 2018. Below, we highlight some key considerations in light of Bill 36 and suggest ways in which you as an employer can help promote a safe and effective work environment.

Regulation of Recreational Cannabis Consumption Would Mirror Regulation of Tobacco Consumption

Bill 36 amends the Cannabis Act, 2017, most importantly by repealing the prohibitions on places where cannabis may be consumed (e.g., public places, workplaces, vehicles and boats, among other prescribed places). Instead, it incorporates the prohibitions articulated in the Smoke-Free Ontario Act, 2017. Under the Smoke-Free Ontario Act, 2017, smoking is prohibited in indoor common areas (e.g., condos and apartment buildings); within 20 metres of schools and places where children gather; within 9 metres of hospitals, hospices, other care facilities; within 20 metres of publicly-owned spaces (e.g., public sports fields), as well as in vehicles and boats in motion or at risk of being in motion. Likewise, under Bill 36, cannabis consumption would be allowed in public places where tobacco and similarly regulated products can be consumed, namely private residences; outdoor places (e.g., sidewalks and parks); designated guest rooms in hotels, motels and inns; residential vehicles and boats (e.g., those that have permanent sleeping accommodations, cooking facilities, and are stationed); research facilities; and certain controlled areas. Consuming cannabis in non-exempted enclosed workplaces would remain prohibited, as well in circumstances where an individual has care and control over a vehicle or boat.

Practically speaking, the changes that permit public consumption imply increased access and opportunity during the work day to consume recreational cannabis, and heighten concerns relating to workplace safety and fitness. These changes also necessitate clearly-worded policies concerning cannabis use in the workplace, particularly in safety-sensitive workplaces.

These changes may also impact an employer’s ability to discipline employees who arrive at or return to work impaired. For example, the approach to disciplining an employee differs where an employee engages in illegal behavior in order to consume cannabis during the work day, versus when an employee lawfully consumes cannabis in a public place on a break before returning to work. The latter, while perhaps still undesirable, would no longer be considered illegal.

As before, accommodation remains a live issue for which employers must continue to carefully plan. Employers are advised to consult with counsel for assistance in developing policies and procedures to address both known and novel concerns, as this area of law continues to develop.

The Cannabis Retail Marketplace: Licences and Authorizations

Bill 36 introduces the various licences and authorizations that underlie the proposed private retail store model. Bill 36 anticipates the establishment of a private retail model by April 1, 2019. Under the measure, the Alcohol and Gaming Commission of Ontario will act as the provincial regulator authorized to grant store licences within the new model. Bill 36 further empowers the ACGO to establish certain standards and requirements concerning the conduct of licencees and authorized persons. 

Bill 36 provides for two types of personal licences: a retail operator licence and a cannabis retail manager licence. It also provides for a retail store authorization. A retail store authorization allows its holder to operate a particular cannabis retail store. Each store requires a separate authorization. In order to apply for a retail store authorization, a person must be the holder of or an applicant for a retail operator licence. But to receive a retail store authorization, an individual must hold an approved retail operator licence. Holders of retail store authorizations are permitted to employ only individuals 19 years of age and older.

A cannabis retail manager licence is required in order to carry out specified functions in a cannabis retail store. For example, only an authorized cannabis retail manager may supervise employees, oversee or coordinate the sale of cannabis, and manage compliance issues in relation to sales. Managers may also have signing authority to purchase cannabis, enter into contracts, or make offers of employment.

Notably, under Bill 36, municipalities retain the ability to pass a resolution by January 22, 2019 prohibiting cannabis retail stores from being located within their boundaries.

Conclusion

As this dynamic area of law continues to develop, we are pleased to advise both employers and retailers on all aspects of employment law concerns as they prepare to meet the demands of Ontarians for cannabis.