What substance use costs Canadian employers, and how to reduce it

Substance use is one of the most expensive problems a Canadian employer can have and one of the least visible. Most of the cost never shows up as a single line item. It is spread across absences, turnover, incidents, disability claims and legal exposure.

The national bill

The most recent Canadian Substance Use Costs and Harms report found that substance use cost the Canadian economy $49.1 billion in 2020, or $1,291 for every person in the country [1]. The largest share was lost productivity: $22.4 billion, or 45.6% of the total, from premature death and long- and short-term disability [1].

• Alcohol was the costliest substance at $19.7 billion, just over 40% of all costs [1].
• Opioids cost $7.1 billion in 2020, the highest of any year studied. Nearly three-quarters of that was lost productivity, mostly from early deaths [1].

What it looks like at work

A 2025 national study by the Canadian Centre on Substance Use and Addiction surveyed workers and managers in safety-sensitive jobs, including construction, natural resources and health care [2]. It found:

• About 1 in 5 workers and 2 in 5 managers reported using alcohol or other drugs within two hours before work or during work, or being hungover or high at work.
• About half of those who used before or during work said they usually kept working and tried to hide it.
• 19% said their workplace culture generally accepted drinking or cannabis use before or during work.
• Only 56% felt they could safely tell a manager about a substance use problem.
• 43% of managers did not feel trained to intervene with a worker who might be impaired.

Injuries

An Institute for Work & Health study followed 1,715 Canadian workers through three survey waves between 2018 and 2020. Workers who used cannabis before or during work were about twice as likely to be injured on the job as non-users. Workers who used cannabis only outside work hours had no added injury risk [3]. The lesson for employers is that the risk sits with impairment at work, which is exactly what fitness-for-duty testing and monitoring are designed to catch.

Absences and turnover

US data adds the day-to-day cost. A 2017 analysis found that workers with a substance use disorder take nearly 50% more unscheduled leave and have 44% higher turnover than the overall workforce. Workers in recovery did better than average, with about 10% fewer unscheduled leave days and 12% lower turnover [4]. Replacing an employee typically costs around a fifth of their annual salary and benefits [4]. Comparable Canadian figures have not been published, so treat these as indicative.

Legal exposure in Canada

Since 2004, section 217.1 of the Criminal Code has placed a legal duty on everyone who directs how others work to take reasonable steps to prevent bodily harm to workers and the public. Organizations convicted on indictment face fines with no upper limit [5]. Provincial safety law adds to this. In British Columbia, section 4.20 of the Occupational Health and Safety Regulation restricts working while impaired by alcohol or drugs in a way that could endanger anyone, and the BC Human Rights Tribunal has accepted stricter zero-tolerance policies in safety-sensitive settings [6].

At the same time, Canadian employers face limits that US employers do not:

• In Irving Pulp & Paper (2013 SCC 34), the Supreme Court held that random alcohol testing in a dangerous workplace still needs evidence of a general substance problem in that workplace.
• In Stewart v. Elk Valley Coal (2017 SCC 30), the Court upheld the termination of a worker involved in an incident who had not disclosed drug use, under a policy that encouraged disclosure before an incident.
• A substance use disorder is a disability under human rights law, so employers have a duty to accommodate up to undue hardship.

US federal rules, such as Department of Transportation testing, often mandate random testing. Canadian law generally does not permit blanket random testing. Employers need a policy built for Canadian law.

What reduces the cost

• A clear impairment policy that covers alcohol, cannabis, other drugs and medications, and encourages early disclosure.
• Post-incident and reasonable cause testing, collected under chain of custody and reviewed by a Medical Review Officer, so decisions rest on confirmed results.
• Manager training to recognize and respond to impairment.
• A return-to-work path with monitoring. Workers in recovery have better attendance and lower turnover than average [4], and 83% of managers in the CCSA study were comfortable with a co-worker returning to the same job after treatment [2]. Monitoring gives the employer objective evidence that the return is working.

This article is general information, not legal advice. Have your drug and alcohol policy reviewed by employment counsel in your province.

Next: Why medical monitoring works for doctors and nurses returning to practice