On March 31, 2021, the NY State Marihuana Regulation & Taxation Act (MRTA) was signed into law, making NY State the 15th state to legalize adult use cannabis. By 2025, it’s estimated there will be 63,000 jobs in NY’s cannabis industry. The NY State cannabis industry is projected to exceed $4 billion and is one of the largest cannabis markets in the country.

Let’s take a look at how MRTA impacts the workplace and explore information about labor and employment law that effects employers and employees in New York State.

Employees 21 years and older have the right to consume cannabis:

  • During personal time outside of work hours
  • Off the employer’s premises
  • Without use of the employer’s equipment or other property


Employers can enforce policies and practices that prohibit an employee from engaging in cannabis use and take action related to the use of cannabis, under the following circumstances:

  • Where an employer is required to do so by state or federal statute, regulation, ordinance, or other state or federal government mandate
  • Where an employee is impaired by the use of cannabis while working and such impairment decreases or lessen the employee’s performance or interferes with a safe and healthy workplace
  • Where the employer’s actions would require the employer to commit an act that would cause the employer to be in violation of federal law or would result in the loss of a federal contract or federal funding

New Yorkers who have a prior record of criminal convictions related to low amounts of cannabis possession before it was legalized will now have these records automatically suppressed (expunged) from their record.  These convictions will no longer appear on a background check when a person applies for a job, a loan or to get into college. The expunged conviction will not be found unless the person applies for a gun license or a job in law enforcement. For more information, visit the NYS Marijuana Criminal Record Expungement FAQs.

New York state employers are prohibited from testing for marijuana of prospective or existing employees except in very limited circumstances (i.e., testing required by law, possession, visible impairment).

The NY State Marihuana Regulation & Taxation Act (MRTA)*

Social Equity and the MRTA

Over the past several decades, the criminalization of cannabis in NY State and across the country has damaged lives, families, and communities. Research tells us that rates of cannabis use has not significantly varied by income, race or ethnicity. Yet, people of color have been far more likely than others to be convicted and incarcerated for cannabis-related offenses. In 2020, over 90% of cannabis arrests in NY City were people of color, even though their cannabis use rates were similar to white people. MRTA seeks to begin the work of repairing decades of disproportionate enforcement, especially in Black and Brown communities. Ensuring those harmed are given an equitable chance to participate and thrive in the legal New York cannabis industry is a key mandate of MRTA.

MRTA seeks to benefit those were most harmed by the injustices of prior cannabis laws. The goal is that at least 50% of all licenses to operate a legal cannabis business will go to applicants who are:

  • People from communities most hurt by prior cannabis law enforcement practices
  • Minorities
  • Women
  • Distressed farmers
  • Service-disabled veterans

Also, extra priority will be given to applicants:

  • From communities unfairly impacted by past cannabis laws
  • Have an income less than 80% of the median income of their county
  • Convicted of a cannabis-related offense or had a family member who was convicted

What NYS agency is implementing MRTA?

MRTA created a new Office of Cannabis Management (OCM) governed by a Cannabis Control Board to comprehensively regulate adult-use, medical, and hemp cannabis. OCM will issue licenses and develop and enforce the regulations outlining how and when businesses can participate in the new industry.

How will New York utilize cannabis taxes?

NYS collects taxes from cannabis businesses. It will first be used to operate NY State cannabis programs and implement the MRTA. The remaining taxes will be split into three separate funds:

will go to the Community Grants Reinvestment Fund which distributes grants to local governments and nonprofit organizations devoted to community revitalization.
0 %
will go to the State Lottery Fund for Education.
0 %
will go to the NY State Drug Treatment and Public Education Fund.
0 %

Where can I get more information and to stay up to date about MRTA?

See: About, Educational Materials and Adult Use and Social and Economic Equity

* In addition to NYS and Federal labor and employment laws and agencies, there are NY Local laws and agencies.
The CWI resources are only provided for general informational purposes and are not a substitute for legal advice. The laws and their implementation change frequently.

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