DOJ Plans To Reclassify Marijuana From Schedule I To Lower-Risk Schedule III Drug –

On April 30, 2024, following a months-long process, the
U.S. Department of Justice (DOJ) circulated a proposal to
reclassify marijuana from a Schedule I to a Schedule III controlled
substance. This historic move—likely the most substantial
change to federal drug policy in more than fifty years—would
place marijuana amongst the likes of acetaminophen with codeine,
some anabolic steroids, testosterone, and ketamine, unlike when it
previously resided on Schedule I alongside substances such as
heroin, LSD, and ecstasy.

The DOJ will send the proposal to the White House Office of
Management and Budget for review. While any reclassification is
months from taking effect (and may become embroiled in litigation),
the cultural significance of this move toward easing federal
restrictions on marijuana is massive, and there are many legal
issues to unpack.

Quick Hits

• The proposal to reclassify marijuana from Schedule I to
  Schedule III is arguably the most significant change to federal
  drug policy in decades.




• There will be no immediate changes—the proposed rule
  change comes with a public comment period that could lead to legal
  challenges (and perhaps, changes) to the proposal.




• The proposal would not completely legalize marijuana at the
  federal level, but it classifies marijuana as having a currently
  accepted medical use.




• The proposal would not change any of the state marijuana
  legalization laws, nor would it change state employment laws that
  are often triggered with marijuana use, such as disability
  discrimination or off-duty conduct laws.

What Does All of This Mean?

The cultural zeitgeist in the United States has shifted in favor
of legalizing marijuana, and this proposal aligns with that shift.
While the proposal will go through a lengthy formal rulemaking
process that may result in legal challenges and/or changes, it
is—regardless of the outcome—hugely significant that
the federal government has acknowledged marijuana’s potential
medical benefits and taken the time and effort to conduct such a
meaningful study.

The proposal is expected to have a tangible impact, in that it
would allow for additional research, reduce some of the more
punitive criminal consequences associated with marijuana, allow the
U.S. Food and Drug Administration to have additional
oversight—and, of course, generally subject marijuana to
fewer restrictions and allow for it to be obtained through a
prescription (in addition to the states that have already legalized
medical marijuana). It would almost certainly provide a boost to
the cannabis industry as a whole, allowing such businesses to bank
more freely and openly in federally regulated banks and operate
without major tax burdens in states where marijuana is legal.
(Namely, those businesses would no longer be subject to the
sections of the Internal Revenue Code and Internal Revenue Service
regulations that prohibit credits/deductions related to income
generated by sales of Schedule I substances.)

How Might This Impact Employers?

The proposal does not go so far as to fully legalize marijuana
at the federal level. While it arguably comes closer than ever to
that point, the proposal does not resolve the federal-state
conflict pertaining to marijuana, nor does it change any of the
various state marijuana legalization laws or
other state employment laws frequently implicated by marijuana
issues in the workplace (such as disability discrimination or
off-duty conduct laws). The biggest impact will be with regard to
the advantages imparted to the marijuana industry. This shift may
also push some employers to reconsider whether to remove marijuana
from testing panels—although the current proposal does not
require this.

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