The Drug-Free Workplace Act of 1988

Background and Application

In 1988, Congress passed the Drug-Free Workplace Act of 1988 in an effort to curb drug abuse by employees working on federally-funded projects. The Act, which went into effect in March of 1989, requires all organizations directly receiving federal grant money to agree that they will provide a “drug-free workplace” before they can receive new funds. It also requires certain federal contractors to make the same promise before they can enter into a new or modified contract with the federal government.

The Act applies to federal contracts with a dollar value in excess of $100,000. It does not impart any requirements upon subcontractors. If a contractor is an individual, the Act simply requires the individual to certify that he or she will not engage in the unlawful manufacture, distribution, possession, or use of a controlled substance in the performance of the contract. If a state agency receives federal funds that it later distributes to various organizations, the state agency, not the organizations, is subject to the requirements of the Act.

Requirements under the Act

Under the Act, employers qualify as providing a “drug-free workplace” by meeting the following requirements:

1. They must publish a statement notifying their employees that the unlawful manufacture, distribution, or possession of illegal drugs is prohibited in the workplace. They must also describe the specific actions that they will take against employees who violate the policy.


2. They must establish a drug-free awareness program that educates employees about (1) the dangers of drug abuse in the workplace, (2) the employer’s drug-free workplace policy, (3) any employee assistance programs, and (4) the penalties that may be imposed upon employees who violate the drug abuse policies.


3. They must provide each employee who will be working pursuant to the contract or grant with a copy of the published drug policy statement.


4. They must inform their employees that, as a condition of their employment on the contract or under the grant, they must abide by the terms of the published drug policy statement and they must notify the contractor or grantee of any workplace drug convictions within five days of the conviction.


5. They must notify the federal granting or contracting agency with 10 days of receiving notice from any employee that he or she was convicted of a drug crime in the workplace.


6. They must either subject employees convicted of workplace drug crimes to sanctions or require them to participate in a drug abuse assistance or rehabilitation program.


7. They must make a “good faith effort” to maintain a drug-free workplace.

Penalties under the Act

Contractors or grantees may have their contracts or grants suspended or terminated if they violate the above requirements. They are also subject to discipline if the number of employees convicted of workplace drug crimes indicates that the employer has not made a good faith effort to comply with the Act. If an employer is “debarred” because of an infraction, the employer will not be allowed to participate in a federal grant program or to seek a federal contract for up to five years.

Copyright 2012 LexisNexis, a division of Reed Elsevier Inc.