On April 23, 2026, the U.S. Department of Justice (DOJ) and the Drug Enforcement Administration (DEA) announced the issuance of an order immediately placing both FDA-approved drugs containing marijuana and medical marijuana products regulated by a state medical marijuana license in Schedule III of the Controlled Substances Act (CSA).
The rescheduling order only applies to the specific medical marijuana categories listed. All other forms of marijuana (including all forms of adult use/recreational marijuana) remain on Schedule I. However, the two agencies also announced that there will be an expedited administrative hearing, which started June 29, 2026, to consider whether all marijuana should be rescheduled from Schedule I to Schedule III. If this broader rescheduling occurs, all forms of marijuana will still be “controlled substances” under federal law and not legalized or decriminalized in the broader sense.
The immediate rescheduling of FDA-approved and state-licensed medical marijuana and the contemplated rescheduling of adult-use/recreational marijuana represent one of the most significant and long-sought changes to federal marijuana policy in decades. The rescheduling order has wide-ranging implications beyond the marijuana industry itself, including on hiring and employment practices relating to medical marijuana use by applicants and employees, as well as drug testing for cannabinoids, even though the current order is very limited in scope. Very little guidance is available from the federal government at this time addressing the consequences of rescheduling.
What Does Schedule III Rescheduling Mean?
Under the CSA, all marijuana has historically been classified as a Schedule I controlled substance, placing it in the same category as substances deemed to have no accepted medical use and a high potential for abuse, such as cocaine and heroin. Many have long argued that this was an illogical or inappropriate grouping. The reclassification to Schedule III for specific medical marijuana products acknowledges the substance's accepted medical uses while maintaining federal regulatory oversight. Schedule III includes many other prescribable drugs, such as Codeine.
The reclassification does not mean that marijuana is “legal” for all purposes; it only means that the specifically approved medical marijuana categories have been recognized as having a valid medical purpose and now can be legally prescribed or certified for use under state-licensed programs by authorized medical marijuana users.
DEA Registration
State-licensed entities that cultivate, manufacture, distribute, or dispense these Schedule III medical marijuana products must register with the DEA and comply with applicable federal requirements.
The DEA has established a registration process, including an online application portal, for state‑licensed medical marijuana providers across the supply chain. The purpose of this process is to bring these entities into the federal controlled‑substance system, where they will be subject to the same recordkeeping, security, and compliance obligations as other Schedule III registrants.
As part of the transition, the DEA created a limited 60-day application window that opened when the rule became effective in late April 2026. Only providers who submitted timely applications within that window are permitted to continue operating under their state licenses without interruption while their federal registration is pending. Providers who did not apply for registration during the 60-day period are not.
The limited application window closed this week. Currently, there is no publicly available database listing state-licensed entities that have applied for and/or been registered with the DEA.
State Anti-Discrimination Laws Involving Marijuana Use
Federal rescheduling will not change or impact state-level laws in jurisdictions that have legalized medical and/or recreational marijuana. In several states, but not Maryland, legalization has been accompanied by legislation that makes it a form of employment discrimination for an employer to take adverse action based on marijuana use or a positive test (excluding intoxication while on the job or that which impacts performance of employment responsibilities).
Some of these laws only apply to medical marijuana use, and some, like a recently enacted Maryland law, only protect certain workers from discrimination based on medical marijuana use or a positive test. Specifically, Senate Bill 439, which becomes effective on October 1, 2026, prohibits adverse employment actions against fire and rescue public safety employees based on marijuana use or a positive test so long as they have a valid written certification for medical cannabis use. As with most employment discrimination laws related to marijuana, Maryland’s protections do not extend to violations of federal regulations or impairment while on the job.
Virginia’s law is more expansive, applying to medical cannabis use by any employee in the state. The law in the Commonwealth prohibits employers from discharging, disciplining, or discriminating against employees for the lawful use of cannabis oil for medical purposes if they hold a valid written certification from a practitioner. However, this protection does not cover recreational use, and employers can still legally conduct drug tests, enforce drug-free workplace policies, and penalize employees for workplace impairment.
The employment protections established in the District of Columbia, however, do extend to off-duty adult use/recreational marijuana use. The District’s Cannabis Employment Protections Amendment Act of 2022 prohibits employers from refusing to hire, terminating, suspending, or otherwise penalizing an individual based upon the individual's use of marijuana, their status as a medical marijuana program patient, or the presence of cannabinoid metabolites in a drug test without additional factors indicating impairment. The D.C. ordinance’s protections do not apply to “safety sensitive” positions.
While bills have been introduced in the Maryland legislature that would prohibit adverse employment actions based on off-duty marijuana use or a positive drug test, there are currently no state law restrictions regarding marijuana-related workplace drug testing, and no specific protection for employees for off-duty marijuana use. As such, employers can fire or refuse to hire individuals whose drug tests return a positive result for marijuana.
Safety First
Rescheduling notwithstanding, and even in states that have prohibited employment discrimination based on marijuana use or testing, certain safety-sensitive jobs and those in federally regulated industries, including transportation and aviation, remain subject to stringent drug testing requirements. After the proposed rescheduling was originally announced in December 2025, the U.S Department of Transportation issued a statement confirming that “Until the rescheduling process is complete, the Department of Transportation’s drug testing process and regulations will not change. Transportation employees in safety-sensitive positions will still be subject to testing for marijuana. Furthermore, the Department’s guidance on medical and recreational marijuana and CBD are still in effect.” The DOT has affirmed its position in an FAQ from May 2026, specifically with respect to state-licensed medical marijuana. DOT, however, has not issued guidance relating to FDA-approved drugs containing marijuana.
It is notoriously difficult to accurately test for current impairment related to marijuana use because metabolites remain in the system for a long period of time. No guidance has been issued by the federal government addressing how medical review officers would review test results to distinguish “adult use” from use of state-licensed medical marijuana (for positions that are not regulated) or validate state-licensed certificates of use.
As the rescheduling process continues, employers should monitor requirements imposed by the DOT and other agencies, such as the Federal Motor Carrier Safety Administration, to ensure that their drug testing practices remain compliant with governing regulations. Employers who engage in drug testing for positions that are not subject to DOT or other regulatory testing requirements should speak with their drug test providers to determine how they intend to review test results given rescheduling.
Hiring and Recruitment Challenges
Legal and regulatory concerns aside, marijuana testing or disqualification from employment during an era of increased use and social acceptance of marijuana can present an impediment to employers seeking qualified candidates. Numerous employers, including corporate behemoths such as Apple, Google, Starbucks, and Target, have already eliminated pre-employment and random post-employment marijuana testing for certain positions to expand applicant pools. Federal rescheduling could encourage more organizations to reconsider whether marijuana screening remains an effective hiring tool for positions that do not require more stringent testing, such as DOT safety-sensitive positions.
Medical Marijuana Accommodations
Rescheduling may also influence discussions regarding disability accommodations and medical marijuana use.
Under the Americans with Disabilities Act (ADA), employers are not required to accommodate the use of illegal drugs. However, now that certain forms of medical marijuana are on Schedule III, employers should expect increasing requests for accommodation relating to medical marijuana use, like other Schedule III medications.
Rescheduling does not automatically require employers to permit on-duty impairment. However, employers should prepare to address accommodation requests related to medical marijuana use through their ADA protocols. Drug testing for marijuana arguably is now covered by the ADA’s rules on medical examinations and confidentiality of medical records. However, the EEOC has issued no guidance or statements on the topic since rescheduling. Employers receiving positive test results for marijuana will now need to determine whether the employee is lawfully using medical marijuana off duty to treat a disability.
Next Steps For Employers
As marijuana laws continue to evolve, employers should avoid relying on assumptions or outdated policies. With the assistance of experienced counsel, employers should consider conducting a careful review of hiring practices, testing programs, accommodation procedures, and workplace safety policies to help ensure compliance and reduce the risk of costly employment disputes.
If you have questions or concerns about how federal rescheduling of medical marijuana impacts your company’s hiring and employment practices, please contact Melissa Jones at Tydings.