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Contact the human resources department and report the intoxication. Call someone in the employee's family or local law enforcement to have the employee taken home. If you feel the employee is a threat to you, other employees or himself, call 911 and stage an immediate intervention.
Remain calm and nonjudgmental. Don't make accusations, but mention the employee's unusual behavior. If you suspect the employee is currently under the influence, now is not the time to address any associated performance issues. Instead, emphasize your concern for the employee's well-being.
If an employee admits that he or she has been drinking while working, can we terminate that person? Generally, yes. However, as with all decisions to terminate employment, employers will want to carefully think through the situation.
Approach the employee politely. Politely approach the employee like a friend and ask if he or she is slightly drunk. If the answer is yes, then you should send the employee home. Make sure you send another employee to drive the employee drunk and place the necessary sanctions like suspension.
If you see someone actively using drugs or alcohol while on the job, you should report it to HR immediately. Reporting a coworker for suspected alcoholism out of concern and without malicious intent is alright, but you still may be accused of libel.
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People also ask

If an employee admits that he or she has been drinking while working, can we terminate that person? Generally, yes. However, as with all decisions to terminate employment, employers will want to carefully think through the situation.
The employer's Disciplinary Policy provided that "being unfit for work through the effects of alcohol" would be considered as gross misconduct.
Remain calm and nonjudgmental. Don't make accusations, but mention the employee's unusual behavior. If you suspect the employee is currently under the influence, now is not the time to address any associated performance issues. Instead, emphasize your concern for the employee's well-being.

warning letter to employee for drinking alcohol on duty