We always recommend employers have a clear drug and alcohol policy either in their individual employment agreements or as a stand-alone document. The policy should provide that an employer can test employees on a random basis, post-accident and for reasonable cause.
The employment agreement should also set out whether an employee works on a safety-sensitive site – that is, a construction site. Only employees carrying out safety-sensitive roles or on safety-sensitive sites can be randomly tested and, even then, only if their employment agreement provides for this. The process set out within any policy must be carefully followed.
Reasonable cause
What do you do when you think an employee’s presentation or behaviour at work suggests they have been using drugs or alcohol? This type of testing is known as reasonable cause and requires an employer to have reasonable grounds to suspect an employee is under the influence or impaired while at work.
An example of reasonable cause may include an employee at work with dilated pupils, erratic behaviour or impaired motor skills. They may mention they tried something new last night or they may have an accident that at face value should not have happened.
Best practice in these situations is to observe the individual and ensure they do not pose a safety risk to themselves or others. It is helpful to take notes and then approach them with your concerns and request to escort them to undergo testing, explaining clearly why you have reasonable cause to suspect drug or alcohol use.
An employer seeking to test an employee who doesn’t fall into one of the established and accepted categories runs the risk of an unjustified disadvantage claim.
A recent case
In Hadfield v Atlas Concrete Ltd, Mr Hadfield was subjected to a random drug test. He returned a non-negative test for cannabis, which was subsequently submitted to a laboratory for testing. At the time of testing, Mr Hadfield admitted he had smoked cannabis on the weekend prior but was not under the influence.
He was suspended during the investigation process and ultimately dismissed as Atlas Concrete concluded that, due to the laboratory test result showing 97 ng/mL of THC-COOH where there was a cut-off of 15 ng\mL, he had ‘attended to work under the influence’.
While there was a separate employee policy for drug and alcohol testing, there were inconsistencies between the policy and the employment agreement. There was also a question as to whether an updated version of the policy could be relied on.
ERA finding
Ultimately, the Employment Relations Authority (ERA) found that, while there was substantive justification for the suspension and dismissal, Mr Hadfield had been unjustifiably disadvantaged by an unpaid suspension and unjustifiably dismissed due to procedural flaws.
This case highlights that, where there may be good reason to terminate an employment relationship, an employer can still face significant liability if mistakes are made as to the process.
Atlas suspended Mr Hadfield without pay in reliance on an updated 2020 drug and alcohol policy that removed a suspended employee’s right to full pay.
Mr Hadfield’s union had not consented to the updated policy prior to its enforcement. On that basis, the ERA found it was unenforceable and that Atlas breached Mr Hadfield’s collective employment agreement by failing to pay him during his period of suspension, financially disadvantaging him.
Reasons for finding
In dismissing Mr Hadfield, Atlas failed to comply with multiple procedural requirements. Following the drug and alcohol test, Atlas issued a letter to Mr Hadfield inviting him to an investigation meeting to discuss the non-negative drug test, which was absent of required key information including:
- documents relied on by Atlas – Mr Hadfield’s employment agreement
- the possible outcome of the meeting
- informing Mr Hadfield of his right to bring a representative
- Atlas’s view on the non-negative test result.
The ERA also found that Atlas did not genuinely consider Mr Hadfield’s feedback about his personal circumstances that led to the non-negative test result nor his previous good service and a request for a second chance.
This was based upon the brevity of the dismissal letter, which was absent as to Atlas’s consideration of those factors. Atlas did not follow its own policy setting out that first-time offenders would be referred to a rehabilitation programme.
The ERA ordered Atlas to pay Mr Hadfield $7,310.12 in lost wages and $16,000 compensation for hurt and humiliation suffered under section 123(1)(c)(i) of the Employment Relations Act 2000, but this compensation was discounted by 20% for Mr Hadfield’s contributing action to the dismissal.
How to prevent costly mistakes
- Have an up-to-date drug and alcohol policy that allows you to carry out random and reasonable-cause drug testing where applicable.
- Ensure consistency between employment agreements and policies.
- Get clear employee and union sign-off when introducing or updating policies.
- Provide all relevant information to an employee during an investigation process.
- Ensure objective measurements for serious misconduct are used. For example, use a clear and measurable cut-off level to define serious misconduct rather than using words such as ‘impairment’ or ‘influence’. Having a defined threshold will create clearer expectations for both parties.