The New Jersey Appellate Division’s recent decision in Sanders v. The Levari Group, LLC marks a significant development in the rapidly evolving intersection of employment law and legalized cannabis. In a precedential opinion, the Court held that the Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (“CREAMMA”), N.J.S.A. 24:6I-31 to -56, implicitly authorizes private civil actions against employers that take adverse employment action based solely upon lawful cannabis use. Sanders v. The Levari Grp., LLC, No. A-2715-23, slip op. at 2 (N.J. Super. Ct. App. Div. May 26, 2026).
The decision substantially expands potential liability for New Jersey employers that continue to rely upon traditional marijuana testing policies in hiring and disciplinary decisions. Although CREAMMA expressly prohibits employers from refusing to hire or otherwise penalizing individuals merely because cannabinoid metabolites appear in their bodily fluids, many employers previously argued that the statute lacked any enforcement mechanism permitting employees or applicants to sue. The Appellate Division rejected that position outright, concluding that CREAMMA’s anti-discrimination provisions would be “meaningless and unenforceable” absent an implied private right of action.
The dispute arose after plaintiff Darlene Sanders applied for employment with The Levari Group, LLC d/b/a First Choice Freezer. According to the complaint, Sanders received a job offer conditioned upon successful completion of a pre-employment drug screening. The screening allegedly detected cannabinoid metabolites attributable to prior recreational cannabis use. Sanders maintained, however, that she was not impaired during the application or interview process and that the positive result reflected only lawful off-duty cannabis use permitted under New Jersey law. See N.J. Const. art. IV, § 7, ¶ 13.
After learning of the test result, the employer allegedly informed Sanders that she could submit to a second drug test if she personally paid for the additional screening. When Sanders declined, the company rescinded the offer of employment. Sanders subsequently filed suit asserting violations of CREAMMA along with several common law claims.
The central issue before the Appellate Division was whether CREAMMA authorizes private individuals to sue employers directly. Because the statute contains no express civil remedy, the Court applied the three-factor framework articulated by the U.S. Supreme Court, in Cort v. Ash, 422 U.S. 66 (1975). Under that analysis, courts examine whether the plaintiff belongs to the class intended to benefit from the statute, whether the Legislature intended to create a private remedy, and whether implying such a remedy is consistent with the broader statutory scheme.
The Court concluded that all three (3) factors supported recognition of a private cause of action. First, the Court emphasized that CREAMMA’s anti-discrimination provisions were specifically designed to protect employees and job applicants from adverse employment consequences stemming from lawful cannabis use. The Legislature expressly acknowledged the long-term economic and social harms associated with marijuana-related stigma, including diminished employment opportunities and financial instability. N.J.S.A. 24:6I-32(n). According to the Court, Sanders fell squarely within the class the statute was intended to protect.
Second, the Appellate Division found compelling evidence that the Legislature intended the anti-discrimination provisions to be enforceable through private litigation. The Court focused heavily upon the statute’s “rights-creating language,” particularly the directive that employers “shall not” refuse to hire or otherwise penalize individuals because of lawful cannabis use. N.J.S.A. 24:6I-52(a)(1). The Court further observed that neither CREAMMA nor the Cannabis Regulatory Commission’s implementing regulations establish any meaningful administrative process for resolving employment discrimination disputes involving non-cannabis businesses.
That absence proved critical to the Court’s reasoning. The Appellate Division explained that interpreting CREAMMA to prohibit discrimination while simultaneously denying individuals any practical enforcement mechanism would effectively nullify the statute. The Court also contrasted CREAMMA with the Opportunity to Compete Act, which the Legislature amended simultaneously with CREAMMA and which expressly disclaims a private right of action. See N.J.S.A. 34:6B-21(c). According to the Court, the Legislature’s decision not to include comparable limiting language in CREAMMA strongly suggested that private lawsuits were permissible.
The Court additionally emphasized that recognizing a private remedy aligns with CREAMMA’s broader remedial purpose. Relying upon the New Jersey Supreme Court’s instruction that CREAMMA should be construed “robustly” to effectuate its objectives, the Appellate Division concluded that private litigation is necessary to eliminate lingering employment barriers associated with lawful cannabis use.
Notably, the Court declined to follow the Third Circuit’s contrary prediction in Zanetich v. Wal-Mart Stores East, Inc., 123 F.4th 128 (3d Cir. 2024), where the federal appellate court concluded that New Jersey courts likely would not recognize an implied cause of action under CREAMMA. The Appellate Division emphasized that federal interpretations of state law are not binding upon New Jersey courts and criticized Zanetich for failing to consider the broader statutory framework and legislative findings underlying CREAMMA.
Although the Court revived Sanders’ statutory claims, it declined to extend New Jersey’s common law wrongful discharge doctrine under Pierce v. Ortho Pharmaceutical Corp., 84 N.J. 58 (1980), to the hiring context. The Court held that Pierce remains limited to wrongful termination claims arising within existing employment relationships. The Court did, however, reinstate Sanders’ negligence, invasion of privacy, and breach of contract claims, concluding that dismissal at the pleading stage was premature.
The practical implications of Sanders are substantial. Employers throughout New Jersey now face significantly increased exposure when making hiring or disciplinary decisions based solely upon positive marijuana test results. The decision reinforces the distinction between actual workplace impairment (i.e.,any departure from normal function due to substances, fatigue, or illness) and the mere presence of cannabinoid metabolites which may remain detectable long after intoxication subsides (i.e., an objective scientific or legal standard proving a substance has hindered an individual’s ability to function safely). While employers may still prohibit on-duty impairment and maintain workplace safety policies, automatic disqualification based exclusively upon lawful off-duty cannabis use now carries considerable litigation risk.
In light of Sanders, New Jersey employers should promptly reevaluate hiring practices, drug testing protocols, and disciplinary procedures to ensure compliance with CREAMMA’s expanding workplace protections. Unless the New Jersey Supreme Court reaches a contrary conclusion, Sanders will likely serve as the leading authority governing cannabis-related employment discrimination claims in New Jersey for the foreseeable future.
Mandelbaum Barrett PC’s Cannabis, Hemp & Psychedelics attorneys stand at the forefront of a dynamic and ever-evolving legal landscape. We possess a detailed understanding of laws associated with the production, sale, use, and regulation of a broad range of controlled substances — from cannabis and hemp to psychedelics.
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