Federal Laws  
  
Drug-Free Workplace Act  
The Drug-Free Workplace Act of 1988 requires businesses holding government contracts of $25,000 or more, and institutions that receive federal grants or other forms of financial assistance, to establish drug education and awareness programs for their workers in an effort to maintain a drug-free workplace.

Who is Covered

The Office of Management and Budget (OMB), which administers the Act, has issued the following guidelines explaining which contractors are covered by the law (for grants approved or awarded on or after March 18, 1989):

  • Contractors that have procured contracts of $25,000 or more from any government agency.
  • Federal grant recipients of any amount.
If a contract is performed both inside and outside the United States, the contractor would only have to comply with the Act on the portion of the contract performed within the United States. Certain contracts within the government would not require a company to comply with the law. For instance, the sale of Treasury bonds by financial institutions would not bring them under the Act, nor would hospitals be covered as a result of Medicare or third-party reimbursements.

Basic Provisions/Requirements

The Act requires that all employers receiving federal grants, as well as certain employers entering into federal contracts, take the following specific steps to maintain and certify that they have a drug-free workplace:

  • Put employees on notice that the company prohibits possession, use, and distribution of illegal drugs in the workplace. Spell out the disciplinary action that will be taken against offenders.
  • Establish education programs that explain to employees the dangers of drug use in the workplace.
  • Provide information on counseling and rehabilitation services available to employees with drug problems.
  • Require employees to agree to abide by the organization’s drug-free workplace standards and to notify the employer of convictions for drug violations that occur in the workplace. Each employee should receive a copy of your written policy and sign a Policy Acknowledgment.
  • Notify the federal agency that manages the organization’s contracts or grants whenever an employee is convicted of a drug offense that occurred in the workplace.
  • Impose disciplinary penalties on employee who are convicted of drug offenses in the workplace, and/or require such people to participate in drug rehabilitation or treatment programs.
  • Make good-faith efforts to maintain a drug-free workplace.