Drug and alcohol policies are common in the workplace to ensure the health and safety of employees, but the enforcement of these policies often raises the question of whether off-duty conduct, such as drug use, can justifiably lead to a dismissal. 

Typically, drug use outside of work only becomes relevant if it affects an employee’s performance at work. The main considerations for employers are whether an employee’s off-duty behaviour poses a risk of impairment whilst at work and whether or not a positive drug test automatically gives cause for dismissal, even when there is no evidence of impairment. 

Case study: The requirement to be ‘drug free’  

Mr Reece Goodsell had been an employee of Sydney Trains for 26 years. During that time, the organisation had an internal Drug and Alcohol Policy which required all employees to be ‘drug free’ and allowed for random testing. On 4th June 2022, Mr Goodsell submitted to a random drug and alcohol test via a urine sample in which the initial test returned a positive result for cocaine metabolites – a biomarker that remains in the body when the drug is processed and broken down.  

A follow up test showed a positive reading for benzoylecgonine over the Australian standard and cut off limit of the company policy. Mr Goodsell was suspended pending an investigation and despite his explanation that it was a one-off incident, he was dismissed for breaching the company’s Code of Conduct and Drug and Alcohol Policy.  

It was noted in the matter that the policy defines ‘drug free’ by reference to passing or failing a drug test and not by reference to actual impairment. Mr Goodsell had stated in the matter that he held the genuine belief that he was not impaired or intoxicated with the effects of cocaine and was fine to attend work.  

In safety-sensitive environments, employers may reasonably rely on drug testing as a tool to manage risk, particularly when there is no practical way to assess employee impairment directly. While drug testing for substance use rather than actual impairment may seem like a blunt instrument, the Fair Work Commission (FWC) maintained it is still a fair and reasonable measure to address safety concerns in the absence of a more precise method of impairment testing. 

Is it fair to dismiss an employee for drug use if they’re not impaired while working? 

Given drug testing for substance use is considered standard, the FWC determined that employers who dismiss an employee based on a positive drug or alcohol test do not need to prove that the employee was impaired while working. A positive test result, in and of itself, can be a valid reason for dismissal under the Fair Work Act, which governs unfair dismissal claims.  

However, the FWC ultimately found the dismissal in Mr Goodsell’s case to be unfair. Despite the employee’s violation of the policy, the Commission considered his 26-year spotless employment record and the fact that he was not impaired on the day of the drug test. Given these factors, the dismissal was deemed disproportionate, and Mr Goodsell was reinstated.  

What should employers consider when dismissing an employee for a failed drug test? 

The decision in Mr Goodsell’s case highlights the important distinction between a valid reason for dismissal (such as a positive drug test) and the fairness of the dismissal process. While a positive test may justify dismissal in many cases, it does not guarantee that the dismissal will be considered fair, particularly when the employee has a long and unblemished work history.  

Where an employee has failed a drug test, employers should consider: 

• Whether or not the employee was impaired and, if so, to what extent 
• Whether the employee does need to be completely ‘drug free’ to perform their duties (i.e. operating heavy machinery) 
• What the employee’s history looks like (i.e. does the employee have a tarnished record in which dismissal would be considered proportionate?)   

Impairment in the workplace can be observed, such as slurred speech, disheveled appearance, rapid weight loss, reduced performance, poor attendance and the smell of alcohol. In many cases, this observation will lead to the decision to conduct a drug test. This is the benefit behind only conducting tests where there is a specific concern of drug or alcohol use – as opposed to random testing – because impairment has already been determined.  

How Business Chamber Queensland can help  

Dismissal for a failed drug test is a significant action that requires careful consideration and adherence to procedural fairness. For employers, it is important to have policies in place that explicitly state the company’s position on alcohol and drug use and to distribute these policies to all employees.  

Any disciplinary action for failed drug tests needs to be justified and proportionate to avoid potential claims of unfair dismissal. Employers can contact Business Chamber Queensland for advice, training and resources when invoking disciplinary action against employees to ensure it is proportionate and reduce the risk of an unfair dismissal claim.