25 Big Companies That Don’t Drug Test Employees

Published on July 2, 2023 at 3:14 pm by Hamna Asim in Lists, News

In this article, we discuss 25 big companies that don’t drug test employees. If you want to skip our detailed discussion on the topic, head directly to 5 Big Companies That Don’t Drug Test Employees.

Using cannabis can affect attention, memory, and learning, same as alcohol. It is understandable that employers prefer workers to be lucid during work, be it drugs or alcohol. However, workplace drug testing can only detect recent cannabis or drug use, and it does not necessarily determine potential safety problems in the future. Other substances like opioids, antidepressants, and medically prescribed marijuana can also cause impairment. If an employee offers a valid prescription, the employer has to legally accept their use of these medications. Similarly, with recreational drugs, unless employees come to work visibly stoned or with their mental faculties impaired, should it really matter to employers what they do on their own time? CBD products that don’t cause a high in users may also contain elements that trigger a positive response on a drug screening test.

While many states approve of pre-employment drug testing, some instruct employers to inform applicants beforehand. An SHRM report highlighted that courts have decreed that pre-employment drug testing is not the same as medical examinations as per the Americans with Disabilities Act. However, the Equal Employment Opportunity Commission demands that these drug tests be carried out after employees receive a conditional job acceptance. This is because the employer may need to make further medical inquiries to applicants based on the test results. Employers should also take into consideration local regulations. For example, conducting random drug tests is prohibited unless mandated by federal law in San Francisco. In California, the state constitution allows individuals the right to privacy, which means drug screenings without proper basis, such as random tests, are permitted in very exceptional circumstances. Similarly, employers must submit a written request to the labor commissioner in Connecticut, stating the reasons for performing random drug screenings, and get approval for the process.

Don’t Miss: 15 States With the Biggest Drug Problems in 2023

Moreover, the legalization of adult-use cannabis across a majority of states is also disrupting the “Just Say No” era when it comes to employment. One significant factor behind the decision to relax drug testing policies is the lack of young blood in the aging workforce. This extends to the federal government and military as well. Per a New York Times report, the US military has allowed 3,400 candidates who failed to meet the drug screening criteria to try for recruitment again over the last five years. Similarly, the FBI and CIA are also relaxing their drug policies and allowing the use of marijuana among job applicants. Moreover, the Biden Administration is aiming to be more lenient when it comes to security clearances, given that over half of the American population has indulged in recreational or medicinal cannabis, and most believe that it should be completely legal. According to Maryland Democrat Jamie Raskin:

“We don’t want to be disqualifying half of the population, tens of millions of people, for having done something that most of our recent presidents have done. You’re taking huge numbers of people off the field.”

Similarly, multiple changes have been made to drug testing policies by government agencies. The CIA, beginning from April 2022, reduced the marijuana abstinence period for new candidates to just 90 days, down from one year. The FBI also lowered its marijuana abstention requirement for potential candidates from three years to one year in 2021. In December 2021, Avril D. Haines, the Director of National Intelligence, announced that past recreational marijuana use should be considered “relevant” but not the sole factor in determining an individual’s suitability for sensitive national security positions.

In this article, we discuss 25 big companies that don’t drug test employees. These include Microsoft Corporation (NASDAQ:MSFT), Netflix, Inc. (NASDAQ:NFLX), and Amazon.com, Inc. (NASDAQ:AMZN).

Our Methodology

For this article, we selected the most prominent firms whose websites don’t explicitly state the need for pre-employment drug screening or random drug testing for employees. For companies whose websites were unclear, we researched on LinkedIn, Indeed, Reddit, and Zippia, and relied on majority consensus to shortlist firms that don’t drug test employees.

It is important to note that most companies reserve the right to perform drug tests on employees who are involved in workplace accidents which could normally be prevented, or individuals who show up to work with their mental faculties very clearly impaired.

Big Companies That Don’t Drug Test Employees

25. Twitter

Twitter, an American social media company, is against drug testing for its employees. This especially became a norm during COVID-19, when remote work was encouraged. Twitter also implemented a remote work structure after the pandemic restrictions were lifted, which meant that drug testing was not necessary at all for employees. However, ever since Elon Musk took over the company on October 27, 2022, the future of the company and its policies – including drug testing – remain uncertain.

In addition to Microsoft Corporation (NASDAQ:MSFT), Netflix, Inc. (NASDAQ:NFLX), and Amazon.com, Inc. (NASDAQ:AMZN), Twitter is one of the big American companies that don’t drug test employees.

24. Michaels

Michaels is a private American-Canadian arts and crafts store chain. The company offers arts and crafts supplies, wall décor, and related merchandise for do-it-yourself house decorators and professionals. Michaels is one of the top companies that do not believe in drug testing its employees.

23. Whole Foods Market

Whole Foods Market is a Texas-based multinational supermarket chain that primarily provides organic foods without artificial colors, flavors, and preservatives. Whole Foods Market, now an Amazon subsidiary, is one of the big companies that don’t drug test employees.

22. Trader Joe’s

Trader Joe’s is a California-based chain of grocery stores spread across the United States. It provides private label staple foods, organic foods, and specialty products. Trader Joe’s is known for its relaxed drug testing policies with employees.

21. In-N-Out Burger

In-N-Out Burger is an American fast food restaurant company with outlets mostly located in California and the Southwest. It is a privately held company that does not drug test its employees.

20. LA Fitness International

LA Fitness International is an American gym chain with presence in the US and Canada. The company was established in 1984, with its headquarters in Irvine, California. LA Fitness International does not drug test its employees.

19. Bed Bath & Beyond Inc.

Bed Bath & Beyond Inc. is a specialty retail company that markets and sells bed linens, bath items, kitchen textiles, and home furnishings. The company is known for its relaxed drug testing policies for new and existing employees.

18. Sprouts Farmers Market, Inc. (NASDAQ:SFM)

Number of Hedge Fund Holders: 20

Sprouts Farmers Market, Inc. (NASDAQ:SFM) offers fresh and organic food products in the United States. On May 1, Sprouts Farmers Market, Inc. (NASDAQ:SFM) offers reported a Q1 non-GAAP EPS of $0.98, beating market estimates by $0.13. However, the revenue of $1.7 billion missed Wall Street consensus by $20 million. Sprouts Farmers Market, Inc. (NASDAQ:SFM) is one of the big American companies that don’t drug test employees.

According to Insider Monkey’s first quarter database, 20 hedge funds were bullish on Sprouts Farmers Market, Inc. (NASDAQ:SFM), compared to 18 funds in the prior quarter. D E Shaw is the largest stakeholder of the company, with 1.10 million shares worth $38.6 million.

Here is what ClearBridge Small Cap Value Strategy has to say about Sprouts Farmers Market, Inc. (NASDAQ:SFM) in its Q3 2022 investor letter:

“We exited a number of stocks during the period, including Sprouts Farmers Market (NASDAQ:SFM). Strong investor sentiment for consumer staples helped bolster Sprouts’s stock price to a level we believe reflected the fair value of the company, and we exited the position to capture the positive returns on the stock.”

17. The Gap, Inc. (NYSE:GPS)

Number of Hedge Fund Holders: 25

The Gap, Inc. (NYSE:GPS) is an American apparel retailer that sells its clothes, accessories, and personal care products under the Old Navy, Gap, Banana Republic, and Athleta brands. The Gap, Inc. (NYSE:GPS) is one of the biggest companies that believe in equal opportunity employment and therefore does not drug test its employees.

On May 25, The Gap, Inc. (NYSE:GPS) reported a Q1 non-GAAP EPS of $0.01, outperforming Wall Street consensus by $0.17. The revenue of $3.28 billion was in-line with market estimates.

According to Insider Monkey’s first quarter database, 25 hedge funds were bullish on The Gap, Inc. (NYSE:GPS), compared to 28 funds in the earlier quarter. Richard S. Pzena’s Pzena Investment Management is the largest position holder in the company.

16. Planet Fitness, Inc. (NYSE:PLNT)

Number of Hedge Fund Holders: 35

Planet Fitness, Inc. (NYSE:PLNT) was founded in 1992 and is headquartered in Hampton, New Hampshire. The company owns, manages, and franchises fitness centers under the Planet Fitness brand. It is one of the top companies that do not believe in employee drug testing.

Planet Fitness, Inc. (NYSE:PLNT) forecasts that its revenue will increase by approximately 13% to 14% and its adjusted EBITDA will grow approximately 17% to 18% in 2023. The company also expects its EPS to climb between 33% to 36%. Planet Fitness also announced new financial targets for the next three years. The company is aiming for revenue growth in the low to mid-teens, adjusted EBITDA growth in the high teens, and adjusted EPS growth in the low to mid-20% range.

According to Insider Monkey’s first quarter database, 35 hedge funds were bullish on Planet Fitness, Inc. (NYSE:PLNT), compared to 32 funds in the prior quarter.

Baron Small Cap Fund made the following comment about Planet Fitness, Inc. (NYSE:PLNT) in its Q4 2022 investor letter:

“Shares of Planet Fitness, Inc. (NYSE:PLNT), the leading franchiser and operator of low-cost fitness centers, rose after reporting strong results. The company reported system-wide same-store sales increased 8.2%, raised estimates for growth in net income, and authorized another large share repurchase. Membership grew to an all-time record, now fully recovered from the pandemic lows. New gym openings are somewhat constrained by availability of HVAC units, but we envision the pace of growth will accelerate and that the base of gyms can still double over time from 2,000 to 4,000. We believe that EBITDA can grow at a mid-teens rate long term on a declining share count and that the trading multiple can modestly expand, which will drive continued good stock performance.”

15. Dollar Tree, Inc. (NASDAQ:DLTR)

Number of Hedge Fund Holders: 38

Dollar Tree, Inc. (NASDAQ:DLTR) operates discount retail stores throughout the United States and Canada. Dollar Tree, Inc. (NASDAQ:DLTR) does not engage in employee drug tests. On May 25, the company reported a Q1 non-GAAP EPS of $1.47, missing Wall Street estimates by $0.07. The revenue of $7.33 billion outperformed market consensus by $60 million.

According to Insider Monkey’s Q1 data, Dollar Tree, Inc. (NASDAQ:DLTR) was part of 38 hedge fund portfolios, with collective stakes worth $2.40 billion. Paul Hilal’s Mantle Ridge LP is the largest position holder in the company, with 11.3 million shares worth $1.6 billion.

Madison Funds made the following comment about Dollar Tree, Inc. (NASDAQ:DLTR) in its fourth-quarter 2022 investor letter:

“Our largest individual detractors were Brookfield Corporation, Alphabet, Amazon, Black Knight, and Dollar Tree, Inc. (NASDAQ:DLTR). Alphabet’s price-to-earnings multiple continues to contract due to concerns about the potential for revenue to be more economically sensitive than it has been historically, given the vast size of the business today. At Amazon, cost pressures and slowing AWS growth weighed on its share price. The regulatory status of Intercontinental Exchange’s pending acquisition offer for Black Knight remains a concern, while in the interim, business conditions have deteriorated given the slowdown in the mortgage market. Lastly, Dollar Tree’s margin outlook disappointed as management is investing to drive traffic to their stores and improve Family Dollar operations.”

14. DICK’S Sporting Goods, Inc. (NYSE:DKS)

Number of Hedge Fund Holders: 43

DICK’S Sporting Goods, Inc. (NYSE:DKS) operates as a sporting goods retailer in the United States. The company provides sporting goods equipment, fitness equipment, golf equipment, hunting and fishing gear, as well as athleisure and accessories. DICK’S Sporting Goods, Inc. (NYSE:DKS) does not drug test its employees.

On May 23, DICK’S Sporting Goods, Inc. (NYSE:DKS) declared a $1.00 per share quarterly dividend, in line with previous. The dividend is payable on June 30, to shareholders of record as of June 16.

According to Insider Monkey’s first quarter database, 43 hedge funds were bullish on DICK’S Sporting Goods, Inc. (NYSE:DKS), compared to 40 funds in the prior quarter. Stephen Mandel’s Lone Pine Capital is the biggest stakeholder of the company, with 4.5 million shares worth $647.8 million.

Here is what Baron Fund has to say about DICK’S Sporting Goods, Inc. (NYSE:DKS) in its Q1 2022 investor letter:

“Dick’s Sporting Goods, Inc. was the first stock Michael recommended to us shortly after he joined Baron Capital in 2003. Dick’s share price has since increased about nine-fold. Unfortunately, we sold our investment in Dick’s about six years ago and, although it was a successful investment, we did not realize the full benefit of Michael’s recommendation. We sold too soon because I was concerned that competition from internet retailers would have a permanent negative impact on Dick’s stores’ profitability. I was wrong. Dick’s stock price so far has about doubled after we sold…and its prospects have brightened!

We sold even though we considered Ed Stack, Dick’s Chairm”n and CEO, a terrific retailer, a great entrepreneur and a special person. Ed had built Dick’s from three bait and tackle stores his dad started into a uniquely positioned, nationwide chain of 730 sporting goods stores. In fact, Dick’s is now the largest nationwide sporting goods chain. Ed had purchased the three bait and tackle stores, the foundation of Dick’s business, from his dad. Ed’s mother loaned him the money to buy his dad’s stores! I’m not exactly sure what that signifies. But it may have something to do with Carl Icahn’s proclamation that “everything I have is for sale except my children…and maybe my wife.”

Ed and his newly appointed CEO Lauren Hobart visited us last month. Ed asked for the meeting to introduce us to Lauren, as well as to discuss the prospects for Dick’s new, large format stores with attached outdoor, student athletic fields. Lauren then described how well its new format stores were doing in two smaller communities. We also spoke about the successes of Dick’s omni-channel retailing efforts and how desirable Dick’s stores have become to shopping centers trying to lure shoppers to return to their malls.”

13. The Kroger Co. (NYSE:KR)

Number of Hedge Fund Holders: 43

The Kroger Co. (NYSE:KR) is a food and drug retailer in the United States. It is one of the big companies that don’t drug test employees. On June 22, The Kroger Co. (NYSE:KR) declared a $0.29 per share quarterly dividend, an 11.5% increase from its prior dividend of $0.26. The dividend is payable on September 1, to shareholders of record on August 15.

According to Insider Monkey’s first quarter database, 43 hedge funds were bullish on The Kroger Co. (NYSE:KR), compared to 42 funds in the preceding quarter. Warren Buffett’s Berkshire Hathaway is the leading stakeholder of the company, with 50 million shares worth $2.46 billion.

Oakmark Fund made the following comment about The Kroger Co. (NYSE:KR) in its Q1 2023 investor letter:

“The Kroger Co. (NYSE:KR is the second-largest grocery retailer in America, behind only Walmart. Although the grocery industry is highly competitive, Kroger’s scale advantages allow it to offer a more compelling value proposition than smaller peers and earn higher returns on capital. In recent years, the market has assigned Kroger a lower multiple due to concerns that e-commerce would disrupt traditional brick-and-mortar grocery businesses. However, we believe Kroger’s performance through the pandemic highlighted that its store footprint, distribution infrastructure, technology investments and strong brand all position the company well for a world with higher online grocery adoption. The stock trades for just 10x our estimate of next year’s EPS, which we believe is attractive given Kroger’s competitive positioning and earnings growth outlook. The pending merger with Albertsons has the potential to drive accelerated earnings growth and further scale advantages. If the merger is not approved, the company will have the capacity to return over 25% of its market cap to shareholders.”

12. Target Corporation (NYSE:TGT)

Number of Hedge Fund Holders: 46

Target Corporation (NYSE:TGT) is a general merchandise retailer in the United States. It is one of the biggest American companies that refrain from drug testing employees. On June 15, Target Corporation (NYSE:TGT) declared a $1.10 per share quarterly dividend, a 1.9% increase from its prior dividend of $1.08. The dividend is payable on September 10, to shareholders of record on August 16.

According to Insider Monkey’s first quarter database, 46 hedge funds were long Target Corporation (NYSE:TGT), compared to 48 funds in the earlier quarter. Ray Dalio’s Bridgewater Associates is a prominent stakeholder of the company, with 664,382 shares worth $110 million.

Madison Sustainable Equity Fund made the following comment about Target Corporation (NYSE:TGT) in its Q1 2023 investor letter:

“Target Corporation (NYSE:TGT) reported a solid fourth quarter, exceeding expectations. Same store sales were positive with better-than-expected margins resulting in earnings for the quarter ahead of expectations. At the same time, Target provided guidance for 2023 that was below expectations, which sets them up to meet or exceed expectations after a difficult 2022. Target expects same store sales for 2023 to range from a low single digit decline to a low single digit increase, with operating margins in the 4.5% to 5% range. We continue to view Target as well positioned for long-term growth with its strong owned brand strategy and omnichannel offerings.”

11. Chipotle Mexican Grill, Inc. (NYSE:CMG)

Number of Hedge Fund Holders: 47

Chipotle Mexican Grill, Inc. (NYSE:CMG) owns and operates Chipotle Mexican Grill restaurants. It is known for having relaxed drug testing policies with its employees. On April 25, Chipotle Mexican Grill, Inc. (NYSE:CMG) reported a Q1 non-GAAP EPS of $10.50 and a revenue of $2.4 billion, outperforming Wall Street estimates by $1.55 and $60 million, respectively. Chipotle Mexican Grill, Inc. (NYSE:CMG)’s in-restaurant sales experienced a notable growth of 22.9%, whereas digital sales accounted for 39.3% of the total revenue generated from the food and beverage segment.

According to Insider Monkey’s first quarter database, 47 hedge funds were bullish on Chipotle Mexican Grill, Inc. (NYSE:CMG), compared to 42 funds in the prior quarter. Bill Ackman’s Pershing Square is the largest stakeholder of the company, with more than 1 million shares worth $1.75 billion.

Ensemble Capital made the following comment about Chipotle Mexican Grill, Inc. (NYSE:CMG) in its Q1 2023 investor letter:

“Chipotle Mexican Grill, Inc. (NYSE:CMG) (+23.12%): The company continues to attract loyal customers to their all natural, fresh food alternative to the highly processed junk food sold by most fast food companies. Despite needing to raise prices by double digit rates to offset inflation in food prices and higher labor costs, the company has seen resilient customer demand. While digital orders have fallen from peak COVID levels, digital sales stabilized in the fourth quarter at approximately 40% of all orders or twice the volume seen pre-COVID. The company has remained busy opening new locations with a focus on those that can support a Chipotlane, the company’s drive through concept that leverages customers’ ability to order ahead on their phones to make pick up times very short. Today, 18% of all locations have a Chipotlane pick up option compared to just 3% pre-COVID.”

10. International Business Machines Corporation (NYSE:IBM)

Number of Hedge Fund Holders: 49

International Business Machines Corporation (NYSE:IBM), an American multinational technology corporation, is one of the biggest companies that don’t engage in drug testing employees. On June 26, International Business Machines Corporation (NYSE:IBM) reached an agreement to purchase Apptio, an enterprise software company, from Vista Equity Partners. The acquisition will be made using IBM’s existing cash reserves and will amount to $4.6 billion. The deal is expected to be finalized in the second half of 2023.

According to Insider Monkey’s first quarter database, 49 hedge funds were bullish on International Business Machines Corporation (NYSE:IBM), compared to 43 funds in the prior quarter. Phill Gross and Robert Atchinson’s Adage Capital Management is a prominent stakeholder of the company, with 680,290 shares worth $89 million.

Diamond Hill Long-Short Fund made the following comment about International Business Machines Corporation (NYSE:IBM) in its Q4 2022 investor letter:

“New positions initiated in Q4 included shorts International Business Machines Corporation (NYSE:IBM), Acushnet Holdings (GOLF) and elf Beauty (ELF). Since diversified information technology company IBM’s 2019 acquisition of Red Hat, the company has aggressively pursued a hybrid cloud strategy. Though IBM and its new management team have made solid progress on this pivot, we believe the company still meaningfully lags the cloud hyperscalers and other cloud-native companies. Management has also laid out aggressive long-term targets for revenue growth and free cash flow, both of which we believe the company will struggle to achieve as it faces intense competition in its hybrid cloud business and structural headwinds in the company’s legacy businesses.”

9. Dollar General Corporation (NYSE:DG)

Number of Hedge Fund Holders: 53

Dollar General Corporation (NYSE:DG) is a prominent American discount retailer that does not drug test employees. On June 1, Dollar General Corporation (NYSE:DG) declared a $0.59 per share quarterly dividend, in line with previous. The dividend is payable on July 25, to shareholders of record on July 11.

According to Insider Monkey’s first quarter database, 53 hedge funds were long Dollar General Corporation (NYSE:DG), compared to 59 funds in the earlier quarter. Ken Griffin’s Citadel Investment Group is the largest stakeholder of the company, with 1.6 million shares worth $344.45 million.

Aristotle Atlantic Focus Growth Strategy made the following comment about Dollar General Corporation (NYSE:DG) in its Q1 2023 investor letter:

“Dollar General Corporation (NYSE:DG shares underperformed on a rotation out of more defensive consumer names at the start of the year despite growing concerns of a slowdown in the economy and the coinciding effects on consumer spending. During the first quarter, Dollar General reported solid comps, as their core lower-income consumer remained resilient despite rising inflation.”

8. McDonald’s Corporation (NYSE:MCD)

Number of Hedge Fund Holders: 64

McDonald’s Corporation (NYSE:MCD) is one of the biggest companies that don’t drug test employees. On April 25, McDonald’s Corporation (NYSE:MCD) reported a Q1 non-GAAP EPS of $2.63 and a revenue of $5.9 billion, topping Wall Street estimates by $0.29 and $320 million, respectively. During the first quarter, there was a rise of approximately 13% in comparable sales across all segments, both globally and within each individual segment.

According to Insider Monkey’s first quarter database, 64 hedge funds were bullish on McDonald’s Corporation (NYSE:MCD), compared to 57 funds in the earlier quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP is the biggest stakeholder of the company, with 1.6 million shares worth $459.2 million.

7. Oracle Corporation (NYSE:ORCL)

Number of Hedge Fund Holders: 67

Oracle Corporation (NYSE:ORCL) is an American multinational that specializes in enterprise software, business software, cloud computing, computer hardware, and consulting. Oracle Corporation (NYSE:ORCL) is known for being one of the big companies that don’t drug test employees.

On June 12, Oracle Corporation (NYSE:ORCL) reported an FQ4 non-GAAP EPS of $1.67 and a revenue of $13.84 billion, outperforming Wall Street estimates by $0.09 and $110 million, respectively. The company also declared a per share quarterly dividend of $0.40, which is payable on July 26 to shareholders on record as of July 12.

According to Insider Monkey’s first quarter database, 67 hedge funds were bullish on Oracle Corporation (NYSE:ORCL), compared to 65 funds in the prior quarter. Jean-Marie Eveillard’s First Eagle Investment Management is the largest stakeholder of the company, with 20.6 million shares worth nearly $2 billion.

6. Starbucks Corporation (NASDAQ:SBUX)

Number of Hedge Fund Holders: 69

Starbucks Corporation (NASDAQ:SBUX), the American coffee giant, is against drug testing its employees. On June 21, Starbucks Corporation (NASDAQ:SBUX) declared a $0.53 per share quarterly dividend, in line with previous. The dividend is distributable on August 25, to shareholders of record on August 11.

According to Insider Monkey’s first quarter database, 69 hedge funds were bullish on Starbucks Corporation (NASDAQ:SBUX), compared to 61 funds in the prior quarter. Ray Dalio’s Bridgewater Associates is a prominent stakeholder of the company, with a position worth $259 million.

Like Microsoft Corporation (NASDAQ:MSFT), Netflix, Inc. (NASDAQ:NFLX), and Amazon.com, Inc. (NASDAQ:AMZN), Starbucks Corporation (NASDAQ:SBUX) does not drug test its employees.

Polen Global Growth Strategy made the following comment about Starbucks Corporation (NASDAQ:SBUX) in its Q4 2022 investor letter:

“We also liquidated our remaining position in Starbucks Corporation (NASDAQ:SBUX). While the company remains a unique and resilient franchise, China is a very important growth market for the company, and zero-COVID policies have made it challenging for the company to operate in this important market. While we expect China to return to more “normal” operation at some point, any COVID flare-ups, in China or other markets, present a very real headwind to Starbucks’ profitability. L’Oreal, Estée Lauder, and other holdings continue to have meaningful exposure to China, but in each of these cases, our research indicates they’re able to better adapt to these operating challenges and realize the growth opportunity in China through their online businesses. In short, we think there are better risk-reward opportunities.”

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