A California lawsuit against Tesla has put a familiar workplace question back in the headlines. Mark Dollard, who works at Tesla's Fremont factory and holds a California medical cannabis card, alleges the company blocked his transfer to a new job after a drug screen came back positive for THC, according to Ganjapreneur's summary of the complaint. He says he used cannabis off the clock after knee surgery and was denied an accommodation without any individual assessment. Tesla has not publicly responded, and the claims have not been proven.
That fight will play out under California law. For New York workers, the more useful question is what happens here. The short answer: New York gives adults who use cannabis legally on their own time some of the strongest job protections in the country, with clear limits.
What Section 201-d protects
When Gov. Andrew Cuomo signed the Marijuana Regulation and Taxation Act (MRTA) on March 31, 2021, it amended Labor Law Section 201-d, the state's off-duty conduct law, to cover cannabis used in line with state law. Employers cannot refuse to hire, fire, or otherwise discriminate against someone for that use as long as it happens before or after work hours, off the employer's premises, and without the employer's equipment or property.
The New York State Department of Labor's workplace guidance spells out the reach. The law applies to all state and local government and private employers in New York, "regardless of size, industry, or occupation." It covers employees 21 and older, regardless of immigration status. It does not cover independent contractors, volunteers, or federal government employers. Employers also cannot make a promise not to use cannabis a condition of hiring or keeping a job, and old blanket no-use policies are not allowed unless an exception applies.
The law has teeth. Section 201-d lets the attorney general seek a court order and civil penalties of $300 for a first violation and $500 for each one after that, and it lets an aggrieved worker sue for equitable relief and damages.
The exceptions employers can lean on
The MRTA added a subsection, 4-a, listing when an employer may still act. Those situations are:
- A state or federal law, regulation, or government mandate requires the action.
- Not acting would put the employer in violation of federal law, or cost it a federal contract or federal funding.
- The worker, while on the job, shows specific, articulable symptoms of cannabis impairment that lessen their performance or interfere with the employer's duty to keep the workplace safe.
Employers can also ban use and possession during "work hours," which the DOL defines broadly to include paid and unpaid breaks, meal periods, and on-call time, even if the worker leaves the site. They can ban cannabis on company property, in company vehicles, and in lockers and desks.
What does not count as proof of impairment
This is where New York stands apart from many states. According to the DOL, a cannabis test "cannot serve as a basis" for concluding a worker was impaired, because current tests do not measure impairment. The same guidance says the smell of cannabis, on its own, is not evidence of impairment either. THC can linger for days or weeks after use, which is why a positive result says little about whether someone is high at work (see our explainer on how long cannabis stays in your system).
Courts have started to apply that reasoning. In Moore v. XWELL, Inc., a Manhattan state judge in December 2024 refused to dismiss a 201-d claim from a worker who said she was fired for smelling like cannabis, finding that odor alone did not establish impairment, according to a summary by the law firm Pospis Law.
Testing itself is limited too. The DOL says employers generally cannot test for cannabis unless an exception applies, and cannot test merely because federal law permits it. Testing that federal or state law makes mandatory, such as for commercial drivers under federal Department of Transportation rules, still goes ahead.
Medical patients, NYC job seekers, and remote workers
Several other rules stack on top of 201-d:
- Medical patients. Under Cannabis Law Section 42, being a certified patient counts as having a disability under the state Human Rights Law, which can trigger accommodation duties. Employers can still enforce rules against working while impaired. The state recently broadened the medical program; see our coverage of Hochul's medical cannabis expansion.
- New York City applicants. Since May 10, 2020, Local Law 91 of 2019 has barred most city employers from pre-employment testing for marijuana or THC. Exceptions include police and peace officers, jobs requiring a commercial driver's license, roles supervising children or medical patients, positions tied to federal contracts or grants, and jobs where a union contract calls for testing.
- Remote workers. The DOL does not treat a home office as a "worksite," but employers can still bar use during work hours and act on observable impairment. The protection applies only to people employed in New York.
Update: October 2026
As of October 9, 2026, we found no public ruling in the Tesla case, which remains a California matter governed by that state's own off-duty cannabis law, in effect since January 2024. Nothing in New York's rules has changed since this story first ran: Section 201-d and the DOL's 2021 guidance remain the controlling framework, and no published New York appellate decision has narrowed the protections. The main thing to watch is federal: changes to how cannabis is scheduled do not by themselves alter federally mandated testing programs, so drivers, pilots, and other safety-sensitive workers should keep assuming those tests apply.
For everyone else, the practical rule holds. Buy from licensed dispensaries, keep cannabis entirely separate from work time, work property, and company vehicles, and if you are penalized purely for legal off-duty use, start with the DOL guidance or an employment lawyer. It is also worth knowing how much you can legally carry in New York.
This article is general information, not legal advice. For adults 21+.