New Jersey voters recently voted to legalize recreational marijuana. Not long after, Governor Phil Murphy issued the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (CREAMMA), which outlines rules and regulations regarding legalized adult-use cannabis in the Garden State.
Despite federal law still listing marijuana as a Schedule 1 drug, people in New Jersey will be allowed to smoke and carry marijuana on their persons legally. But CREAMMA takes legalization in New Jersey several steps further to outline specific regulations.
This law regulates a few aspects of the new space, including employers’ responsibilities and employees’ rights pertaining to marijuana use and how it should be regarded in and out of the workplace. Furthermore, CREAMMA will allow microbusinesses to open within the state.
In this article, we’re covering CREAMMA in New Jersey and the regulations we can expect as this state’s new market develops.
Interested in opening a cannabis microbusiness in New Jersey or scaling an existing one? We’re here to help!
Contact us now to get your microbusiness organized and compliant in preparation for New Jersey’s budding adult-use market!
CREAMMA Supports a Craft Cannabis Industry in New Jersey
We all know about craft beer and its popularity. But what about craft cannabis?
CREAMMA aims to expand the cannabis industry in New Jersey by encouraging microbusinesses to set up shop.
Under CREAMMA, the definition of a microbusiness is a person or entity that receives licensing from the Cannabis Regulatory Commission as either a marijuana cultivator, manufacturer, wholesaler, distributor, retailer, or delivery service. Here’s a synopsis of how these microbusinesses are expected to operate under CREAMMA:
- Microbusinesses can have up to ten employees.
- Microbusinesses can operate a cannabis establishment that occupies up to 2,500 square feet. If it’s a cannabis cultivator, the grow area cannot exceed 2,500 square feet, measured on a horizontal plane. The grow operation cannot grow in excess of 24 feet above that plane.
- Microbusinesses are allowed to possess up to 1,000 cannabis plants per month. However, distributors can possess plants for transportation without being subjected to this limitation.
- Manufacturing microbusinesses can obtain up to 1,000 pounds of usable cannabis each month.
- Wholesaling microbusinesses can obtain up to 1,000 pounds of usable cannabis or the equivalent in any form of manufactured cannabis products or cannabis resin, as well as combinations of these various cannabis products.
- Retailer microbusinesses are allowed to obtain up to 1,000 pounds of usable cannabis or the equivalent amount of manufactured cannabis products or cannabis resin, as well as combinations of these different types of cannabis products.
Restrictions & Conditions NJ Cannabis Microbusiness Operators Should Know About
If you plan on starting a cannabis microbusiness in New Jersey, you’ll need to follow these ownership requirements and restrictions:
- Your microbusiness must be 100 percent New Jersey resident-owned. This resident must have been living in the state for at least the last two consecutive years.
- A minimum of 51 percent of the owners, directors, officers, or employees working for the microbusiness must be residents of the municipality that the business is located or to be located. They can also reside in a municipality bordering it.
- Owners, directors, officers, or other people with a financial interest in the operation who also maintains decision-making authority cannot hold any financial interest in another licensed cannabis establishment, regardless of whether it’s a microbusiness.
- Owners, directors, officers, or other people with a financial interest in the operation who also maintains decision-making authority for a licensed cannabis establishment, regardless of whether a microbusiness, are not allowed to hold a financial interest in a microbusiness.
More Information About What CREAMMA Means for Cannabis Microbusinesses
CREAMMA makes microbusiness licenses valid for a year with the option to renew annually or be replaced while it’s still valid. The annual license lets microbusinesses convert and continue operating as a licensed person or entity that’s not a microbusiness, which will be based on a process and criteria the CRC establishes.
At this point, there is a maximum of 37 cultivation licenses available under CREAMMA. But this doesn’t apply to the growers who are issued a microbusiness license.
Under CREAMMA, microbusiness owners are not allowed to sell or transfer a microbusiness license. Also, CREAMMA does not allow microbusinesses to have a cannabis consumption area. This is reserved only for licensed cannabis retail establishments and medical cannabis dispensaries.
Eventually, it’s possible for CREAMMA to include cannabis consumption areas. But, for now, retail microbusinesses will have to wait if they’d like to obtain an endorsement for cannabis consumption areas.
CREAMMA also impacts employees and employers, regardless of whether they’re involved in the cannabis sector. This is exciting for some and potentially stress-inducing for others.
CREAMMA – What Does it Mean for Employees & Employers?
After being signed into law on Monday, February 22, 2021, CREAMMA makes marijuana use will be legal and regulated for adults 21 and older. It decriminalizes possession of limited amounts of marijuana, as well.
But it does more than that, particularly for employers and employees.
At this point, the regulations that interpret this law are still a long way away from being decided. However, it’s crucial for employers to begin thinking about how it will impact their drug policies and drug testing programs.
Through CREAMMA, employees receive new substantial protections, specifically in regards to engaging in lawful behavior involving marijuana. This has the potential to be a real challenge for employers, especially when considering the fact that testing for tetrahydrocannabinol (THC) is still not accurate.
THC, which is the primary psychoactive cannabinoid found in cannabis, takes quite some time to break down. Since the metabolites can be measured for an extended period of time, it’s challenging to test whether an employee is impaired on the job or legally ingested it the night or even weeks before.
However, there is some good news for employers. Under CREAMMA, you’re still allowed to ban “the use… consumption, possession, transfer, display, transportation, sale, or growth of cannabis or cannabis items in the workplace” while work is in session. Employers are also able to ban employees from coming into work while still feeling the effects of marijuana.
Furthermore, as an employer, you can still administer drug tests to employees and can discipline or discharge employees who have used, possessed, or were intoxicated by marijuana while at your place of work during work hours.
But it’s not all good news. Employers are not permitted to discipline or dismiss employees if they fail a drug test for the substance. Rather, the employee must go through a physical examination “conducted by an individual with the necessary certification to opine on the employee’s state of impairment, or lack thereof.”
With CREAMMA in place, the Cannabis Regulatory Commission must prescribe “standards in regulation for a Workplace Impairment Recognition Expert (WIRE) certification, to be issued to full- or part-time employees, or others contracted to perform services on behalf of an employee’s usage of, or impairment from, a cannabis item or other intoxicating substance, and for assisting in the investigation of workplace accidents.” After the WIRE certification is available, which is unlikely to happen for several months, employers will need to have supervisors and/or management-level employees obtain the certification.
In essence, employees now have the decision to use marijuana recreationally with protected status under New Jersey law. While this is a win in and of itself for the cannabis industry as a whole, it’s important to understand that this will impact the way businesses operate, regardless of whether they’re working in cannabis.
CREAMMA is legislation that establishes the ground rules for how microbusinesses in New Jersey’s newly legalized cannabis sector are expected to operate. But it also provides protection to employees who want to consume legally. As a result, we can expect more consumers to enter the space as more microbusinesses get up and running.
If you’re interested in setting up your own cannabis microbusiness in New Jersey or scaling an existing one, we’re here to help!
Contact us now to learn how we’ll get your microbusiness organized and compliant for New Jersey’s budding adult-use market!