What Is CREAMMA?

The Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (CREAMMA or the Act), codified at N.J.S.A. 24:6I-31, was enacted in 2021 to legalize recreational cannabis for adults aged 21 and older in New Jersey. Among its most significant provisions for employers, the Act prohibits adverse employment actions—including refusal to hire, termination, demotion, or other discipline—against employees or applicants based solely on their lawful, off-duty recreational use of cannabis. See N.J.S.A. 24:6I-52.

Critically, however, CREAMMA does not provide blanket protection for all cannabis-related conduct. The statute does not protect employees who use or possess cannabis in the workplace or who are under the influence during work hours. Employers retain the right to maintain drug-free workplace policies and prohibit cannabis use, possession, and impairment on the job. An employee who reports to work impaired by cannabis remains subject to discipline up to and including termination.

A New Private Right of Action: Sanders v. The Levari Group, LLC

A recent New Jersey Appellate Division decision significantly expanded employer risk under CREAMMA. In Sanders v. The Levari Group, the court addressed whether employees may bring a private cause of action directly in court or whether enforcement is limited to administrative channels through the New Jersey Cannabis Regulatory Commission (CRC). No. A-2715-23, 2026 WL 1532963 (N.J. Super. Ct. App. Div. May 26, 2026). In that case, the plaintiff received a job offer for a customer service representative position. The employer withdrew the offer after the plaintiff tested positive for cannabinoid metabolites on a pre-employment drug test. The plaintiff filed suit, and the trial court dismissed her CREAMMA claim, finding no legislative intent to create a private right of action.

On appeal, the Appellate Division reversed. It held that CREAMMA implies a private right of action, applying the three-factor test from Cort v. Ash, 422 U.S. 66 (1975). In doing so, the Appellate Division rejected the Third Circuit's contrary conclusion in Zanetich v. Wal-Mart Stores East, 123 F.4th 128 (3d Cir. 2024), noting that it is not bound by federal court interpretations of state law. Significantly, the decision establishes that aggrieved employees and applicants may pursue claims directly in court, opening the door to private litigation and the full range of legal remedies, including monetary damages.

Challenges for Employers: Drug Testing and the WIRE Requirement.

Although CREAMMA explicitly permits employers to drug test employees and applicants, such testing must be accompanied by a physical evaluation to determine whether the individual is currently impaired due to cannabis use. These evaluations must be conducted by a certified Workplace Impairment Recognition Expert (WIRE).

Pursuant to CREAMMA, the CRC, in consultation with the New Jersey Department of Labor and Workforce Development, is charged with prescribing standards for WIRE certification. Such certifications may be issued to full-time or part-time employees, or to third parties contracted to perform services on behalf of an employer, provided they complete the requisite education and training in detecting and identifying an employee’s usage of, or impairment from, cannabis or other intoxicating substances. As of the date of this publication, the CRC has not yet issued formal WIRE certification standards.

In September 2022, however, the CRC issued interim guidance clarifying that, until formal WIRE certification standards are promulgated, employers may designate “sufficiently trained” staff members to assist in documenting observable physical and behavioral signs of impairment using a Reasonable Suspicion Observation Report developed and published by the CRC. Indicators may include, but are not limited to, the odor of marijuana, glassy or bloodshot eyes, slurred speech, diminished motor coordination, and impaired judgment. Note, however, that the Reasonable Suspicion Observation Report is not cannabis-specific. Accordingly, employers should ensure that designated personnel receive training to identify cannabis-related indicators of intoxication and that such observations be thoroughly documented.

CREAMMA's limitation on the use of positive drug tests is rooted in the inherent unreliability of current cannabis testing methods to measure contemporaneous intoxication. Conventional cannabis testing—particularly urine-based testing—detects THC metabolites that may persist in an individual's system long after any impairing effects have subsided. Consequently, an individual who lawfully consumes cannabis recreationally may test positive days or even weeks after last use. The positive result thus reflects historical consumption, not present impairment.

This scientific reality renders positive drug test results largely uninformative as to whether an employee was impaired during working hours. Accordingly, the CRC mandates that drug test results be coupled with evidence-based documentation of physical signs or behavioral indicators of impairment observed during the employee’s prescribed work hours before an employer may take adverse employment action on the basis of workplace intoxication.

State vs. Federal Law Tension

Despite New Jersey’s legalization, recreational cannabis remains classified as a Schedule I controlled substance under the federal Controlled Substances Act, 21 U.S.C. Section 801. (Note: As of April 2026, the Department of Justice reclassified medical marijuana and state-licensed or FDA-approved cannabis products to Schedule III). This creates a direct conflict that poses particular challenges for employers operating in both state and federal spheres. Employers with employees who hold federally regulated licenses or certifications face an especially complex compliance environment. For example:

Federal Contractors

Employers that perform work under federal contracts may be required to comply with federal drug-free workplace requirements. 48 CFR Section 26.5. Because cannabis remains classified as a Schedule I controlled substance under federal law, permitting employee marijuana use, in certain circumstances, could jeopardize an employer’s compliance with federal contractual obligations or other federally mandated workplace standards.

Department of Transportation (DOT)-Regulated Positions

The U.S. Department of Transportation (DOT) enforces a strict zero-tolerance policy regarding cannabis use for all safety sensitive roles. 49 CFR Section 40; 49 U.S.C. Section 31306. Employees in safety-sensitive roles, such as commercial motor vehicle drivers and airline pilots, are subject to stringent federal drug-testing requirements. 49 U.S.C. Section 382; 14 CFR Section 120. A verified positive drug test of an employee in a safety-sensitive position requires employers to comply with federal regulations, regardless of state cannabis laws. 49 CFR Section 40.23. Required actions include:

1. Immediate Removal from Safety-Sensitive Duties. The employee must be removed from all DOT-covered safety-sensitive functions and cannot return until completing the return-to-duty process.
2. Referral to a Substance Abuse Professional (SAP). The employer must provide the employee with a list of qualified SAPs who are authorized to conduct the required evaluation and recommend appropriate treatment or education.
3. Reporting to the FMCSA Clearinghouse. For commercial drivers, the employer must report the drug violation to the Federal Motor Carrier Safety Administration (FMCSA) Drug and Alcohol Clearinghouse no later than the close of the third business day after receiving the verified positive test result.
4. Completion of the Return-to-Duty (RTD) Process. Completion of the RTD process includes:

• Undergo a face-to-face evaluation with a qualified SAP
• Complete treatment or education programs recommended by the SAP
• Pass a return-to-duty drug test
• Submit to a minimum of six unannounced follow-up drug tests during the first 12 months after returning to duty, although the follow-up testing period may extend up to 60 months

CREAMMA Exception

N.J.S.A. 24:61-52(b)(1)(b) contains a limited federal law exception to its general prohibition against taking adverse employment action based solely on a positive cannabis test. Specifically, when compliance with CREAMMA would result in a “provable adverse impact” on an employer subject to the requirements of a federal contract, then the employer may take adverse action against the employee consistent with federal law, rules, and regulations.

The federal law exception, however, is not automatic. An employer invoking the exception must be able to demonstrate that compliance with CREAMMA would specifically result in the loss of federal funding, the loss of a federal contract, or a violation of a binding federal statute, regulation, or contractual obligation. Given the fact-specific nature of this analysis, employers should consult experienced counsel to determine whether the exception applies in a particular circumstance and to ensure any employment action is legally defensible.

Best Practices: Focus on Performance

Given these complexities, employers are well-served by a straightforward guiding principle: to the extent possible, document and take action based on actual work performance deficiencies and observable conduct, regardless of whether the employer suspects the employee may be under the influence of cannabis. By focusing on objective, documented performance issues—attendance problems, failure to meet job standards, safety violations, quality of work deficiencies—employers can build a defensible record that does not depend on the outcome of a drug test or a WIRE evaluation.

With that said, employers should continue to monitor guidance from the CRC and remain vigilant for the issuance of WIRE standards. In the meantime, employers should ensure that designated personnel—typically managers and human resources staff—are adequately trained to identify cannabis-specific physical and behavioral indicators of impairment and to document their observations thoroughly. To the extent employers have not already done so, they should train supervisors and managers on CREAMMA protections and update workplace policies and drug testing protocols accordingly.

Reprinted with permission from the July 17, 2026 issue of the New Jersey Law Journal. © 2026 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.