Court Allows CREAMMA Lawsuits Over Cannabis Discrimination
A New Jersey appeals court has ruled that employees and job applicants may sue employers for discrimination based on lawful, off-duty recreational cannabis use. In Sanders v. The Levari Group, LLC, decided May 26, 2026, the New Jersey Appellate Division held for the first time that the Cannabis Regulatory, Enforcement Assistance, and Market Modernization Act (CREAMMA) includes an implied private right of action. Importantly, this rejects a 2024 decision by the U.S. Court of Appeals for the Third Circuit that held in that CREAMMA did not create a private right of action. Therefore, employees may now sue if they are terminated or refused employment due to recreational cannabis use, rather than merely seek enforcement from the state.
Why Was the New Jersey Job Offer Rescinded?
Darlene Sanders applied and interviewed for a customer service position with The Levari Group, LLC. After accepting a job offer, she completed a pre-employment drug screening required by the company’s standard hiring process.
The drug test detected cannabis associated with recreational use during the previous 30 days, although Sanders was not under the influence when she applied. After she asked about her start date, a human resources representative said she could take another drug test within one week at her own expense. Sanders declined because she could not afford the retest, and the company rescinded the offer.
Sanders sued, alleging that the employer violated CREAMMA by refusing to hire her because of her recreational cannabis use.
What Employment Protections Does New Jersey’s CREAMMA Law Provide?
Enacted in 2021 to legalize and regulate recreational cannabis, CREAMMA includes employment protections intended to reduce the harmful effect that marijuana-related penalties can have on a person’s career and financial well-being.
Under CREAMMA, an employer may not refuse to hire, discharge, or otherwise take adverse action against a person solely because the person’s bodily fluids contain cannabinoid metabolites resulting from lawful cannabis use. The statute expressly provides these employment protections, but it did not expressly state whether an individual could sue an employer for violating them.
The trial court initially agreed with the employer that enforcement should be left to the Cannabis Regulatory Commission (CRC).
Why Did the Court Allow a Private Lawsuit Under CREAMMA?
The Appellate Division rejected the trial court’s limitation. Applying the legal standard known as the Cort test, the court concluded that the New Jersey Legislature implicitly intended to allow workers to bring lawsuits under CREAMMA.
What the New Jersey Cannabis Employment Decision Means
For New Jersey employees and job applicants, the decision creates a path to seek relief in court when an employer penalizes them solely for lawful, off-duty recreational cannabis use. For employers, it highlights the legal risk of making hiring or employment decisions based only on a positive cannabis test. Employers should review drug-testing and hiring policies for compliance with CREAMMA.
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This article provides general information and does not constitute legal advice.