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A growing number of companies are cutting back on their drug testing

In an undated photo, a urine test sample container. Companies that set up urine testing labs have breathlessly pitched how lucrative the business can be: “15 samples per day could yield $800,000 in profit!” (Johnny Tergo/The New York Times/Copyright 2018/New York Times)

Combine a growing economy, a tight labor market and an increasing number of states that are legalizing marijuana and what do you have? For one thing, you have fewer companies doing drug testing of new and current employees.

"The benefits of at least reconsidering the drug policy on behalf of an employer would be pretty high," Jeremy Kidd, a professor at Mercer Law School, who wrote a paper on the economics of workplace drug testing, told the Insurance Journal. "A blanket prohibition can't possibly be the most economically efficient policy."

Not surprising, companies in states where marijuana has been legalized - whether for recreational or medicinal use - are leading this trend. For example, only two-thirds of 609 employers that were recently surveyed in Colorado said that they were conducting drug tests of their employees. That number is down from 77 percent the year before.

A half-dozen large companies, according to one labor lawyer, have quietly changed their policies in response. Other well-known companies such as AutoNation, Inc. and The Denver Post have also relaxed their rules. Of course, no one wants to give the impression that they're soft on drugs. But circumstances have changed.

The tight economy is making it hard to find and retain good people and drug testing further limits an employer's options. In addition, recent studies have shown that Americans are more tolerant of certain drugs, particularly when compared to previous generations. Another factor is the rising costs of doing drug tests - which can be as much as $30 to $50 a pop. Many employers are finding that even incentives given from insurance companies for maintaining a "drug free" workplace and the anti-marijuana rumblings from Attorney General Jeff Sessions aren't enough to outweigh the costs of drug testing.

"We don't care what people do in their free time," Liam Meyer, a spokesman for Excellence Health, a 6,000-person company based in Las Vegas, said in the Insurance Journal report. "We want to help these people, instead of saying: 'Hey, you can't work for us because you used a substance.' "

Author Information: Gene Marks owns the Marks Group, Bala Cynwyd, Pa.-based consulting firm that helps clinets with customer relationship management.