Jasmin Mantoufeh – Chamberlains: Medicinal Cannabis: An Australian Workplace Law Perspective

Author: Jasmin Mantoufeh

Jasmin Mantoufeh


Recent regulatory reforms, including the Narcotic Drugs Amendment Act 2016 (Cth), have ensured that the cultivation, production, and distribution of medicinal cannabis is lawful nationwide subject to certain conditions and exceptions. Although medicinal cannabis is a legitimate prescription medication, there remains significant legal ambiguity for users, particularly surrounding its use in the workplace. 

Evolving Workplace Legislation

In Australia, the legislation and common law surrounding the use of medicinal cannabis remains limited. Despite the slow start, the case law that governs the use of medical cannabis in the workplace has considerably evolved however, there have been no amendments made to workplace legislation that address: 

  1. the circumstances in which medicinal cannabis is not a prohibited or illicit substance i.e. prescription versus illegal possession;
  2. workplace process and procedure for notification, investigation, consultation and resolutions concerning employees prescribed medicinal cannabis; 
  3. employer and employee obligations with respect to submitting to drug and alcohol tests, consenting to release of medical records and attending independent medical assessments;
  4. guidelines for assessing fitness for work, modified duties and workplace testing; 
  5. risk assessment guidelines; and 
  6. implementing policies that are fair, transparent and respectful.


It is also important to note that in Australia, the legislation that governs medical cannabis and the workplace can vary state-to-state. For example, in Queensland medical cannabis does not feature on their Pharmaceutical Benefits Scheme, whilst in NSW, employees are able to be reimbursed for medical marijuana as a medical expense in workers compensation claims provided that it is reasonably necessary to treat the workplace injury.

Current Issues in the Workplace

A significant issue that highlights the unsettled discourse surrounding the possession and consumption of medicinal cannabis are outdated drug and alcohol policies. It is not uncommon for workplace policies to incorrectly define medicinal cannabis as an “illicit”, “illegal” or “prohibited” substance even in instances when it is prescribed by a registered medical practitioner. 

Contrary to the current legal landscape, outdated workplace policies tend to distort employees’ rights by failing to provide clear internal governance procedures, transparent communication mechanisms to address sensitive health matters and methods for assessing reasonableness, capacity and scope to modify duties especially if the treatment concerns a workplace injury, 

Over time, we have observed a increasing pattern of unfair dismissals by virtue of workplace policies that have a blanket “no-tolerance” position with respect to illegal substances which erroneously include prescription cannabis. 

In the matter of Mr Gary Hilder v Sydney Trains [2019] FWC 8412 (“Hilder”), Mr Hilder consumed cannabis the night before he was due to work. When he went into work the following day, he tested positive for THC after being urine tested and was subsequently dismissed in contravention of their drug and alcohol policy. However, the Fair Work Commission found that Mr Hilder was unfairly dismissed, after they weighed up the company’s  application and active compliance with its workplace policies.

It is important that employees are aware that testing positive for THC may result in a valid dismissal, even in circumstances when they have obtained a prescription. This is particularly prevalent in high-risk industries such as construction or transport, where sobriety from the effect of any drug is considered an essential condition of employment. However, if an employee has previously discussed their prescription with their employer, the employer must implement  a contingency plan to ensure that the employee retains the benefit of their medical cannabis without imposing a workplace health and safety risk.

Recommendations for Employers

In circumstances where an employer enforces an outdated Drug and Alcohol Policy with a blanket “zero tolerance” position, notwithstanding the current legality of prescription medicinal cannabis, and subsequently terminates or prejudices an employee on that basis, that employer runs the risk of becoming a party to unfair dismissal, adverse action or disability discrimination proceedings.

A legally sound Drug and Alcohol Policy requires employers to actively educate, train and remind staff members of workplace expectations and procedure in order to comply with its workplace law and WHS obligations.  

It is equally crucial that employers have updated their Privacy Policies for internal record-keeping purposes. The Privacy Act 1998 (Cth) requires employers to seek approval from employees to access personal and sensitive health information. A Privacy Policy, in line with a Drug and Alcohol policy should dictate: 

  1. the type of information that may be requested by an employer and it what circumstances;
  2. the process for obtaining that information (i.e. contacting a treating medical practitioner);
  3. consultation and risk assessment; 
  4. cyber security and storage; 
  5. requests for access and/or alteration; 
  6. continuity of access; and
  7. retention period. 


Contact the Workplace Law Team at Chamberlains Law Firm for a free consultation today.

Jasmin Mantoufeh
Lawyer – Corporate, Commercial & Workplace Law
T: 02 9264 9111 | D: 02 6188 3633
Chamberlains Law Firm | www.chamberlains.com.au
L12, 59 Goulburn Street Sydney NSW 2000
Sydney | Canberra | Newcastle | Perth


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