Amazon (NASDAQ:AMZN) officially revealed support for the federal legalization of marijuana, and cannabis stocks took off as a result. In connection with its support for federal legalization, the online retailer will stop screening most prospective employees for marijuana, which it will treat the same as alcohol. Employees for certain positions like delivery drivers will still be screened.
Policy changes
In a blog post, Amazon Worldwide Consumer CEO Dave Clark said they are adjusting their "Time off Task" policy and drug screening policy. The "Time off Task" policy focuses on how much time employees spend logged out of the software they use to do their jobs.
Critics have accused Amazon of creating a stressful work environment with the policy, but the company now says it will analyze the time employees spend logged out to find out why they are logged out.
Amazon supports cannabis legalization
The change to the drug screening policy is a response to "where state laws are moving across the U.S.," a reference to the fact that many states have voted to legalize cannabis. Amazon said it would not screen for marijuana when it fills positions not regulated by the Department of Transportation. It will also do impairment checks on the job and test for all drugs and alcohol after an incident.
In connection with the announcement about the policy changes, Amazon officially threw its support behind the Marijuana Opportunity Reinvestment and Expungement Act of 2021, also known as the MORE Act. The legislation would legalize cannabis at the federal level, expunge criminal records and "invest in impacted communities." Clark said they hope other employers will join Amazon and that lawmakers will "act swiftly to pass this law."
Cannabis stocks surge
After Amazon threw its support behind marijuana legalization, cannabis stocks soared. Aurora Cannabis (NASDAQ:ACB) jumped on Wednesday, although it didn't move much in the premarket hours this morning. Cronos Group (NASDAQ:CRON) also surged on Wednesday, although it was in the red during the premarket hours this morning, and it was the same story with Canopy Growth (NASDAQ:CGC).
Leafly noted that many cannabis enthusiasts might be concerned that it will kill other companies in the space if or when Amazon starts selling the drug. However, the blog said we should be looking at what happened with alcohol sales rather than book sales. Amazon may have killed bookstores, but Leafly argues that since consumers didn't change their alcohol purchasing habits when Amazon started selling liquor, they won't change their pot buying habits either.
Amazon is part of the Entrepreneur Index, which tracks 60 of the largest publicly traded companies managed by their founders or their founders' families. Tilray (NASDAQ:TLRY) jumped during regular trading hours on Wednesday and climbed another 9% in premarket trading this morning.