When you hear the word “compliance,” what comes to mind? If you’re like most cannabis business owners, you think of issues related to the cannabis-related product you sell. You think of things like seed-to-sale tracking, diversion, or keeping cannabis out of the hands of minors. What many do not realize, however, is that running a compliant cannabis business is more than just keeping an eye on your product, it also involves keeping up with the myriad of ever-changing state and federal labor laws.
Whether you realize it or not, state and federal labor laws change almost as much, if not more than, cannabis regulations.
Local Labor Laws for Cannabis Compliance
Not only do federal and state labor laws change frequently, but so too can local labor regulations. In some states, labor laws can even vary by city and county you’re located in.
In California, for example, the cities of Oakland and Los Angeles have more generous paid sick leave requirements that the state-specific minimums. If you didn’t know that and operated under the assumption that state and federal standards were sufficient, you could get yourself in trouble with local authorities.
State Labor Law Examples for Cannabis Compliance
Here are a few examples of recently updated state labor laws that you may not have noticed.
At the start of 2019, Colorado increased its minimum wage to $11.10 per hour. What you may not know, however, is that the minimum wage is set to rise again. On January 1, 2020, employers must pay their employees $12 per hour for regular employees and $8.98 for tipped employees. Starting in 2021, Colorado’s minimum wage will be pegged to the Consumer Price Index, rising each year as prices increase. If managed in-house, your cannabis payroll specialist will need to have processes in place to ensure your pay rates are changing with these requirements.
There is also a bill going through the Colorado legislature which, if passed, would allow cities to pass their own minimum wage laws. If you operate in cities like Denver and Boulder, whose local officials are committed to raising the minimum wage to $15 an hour, you may see your labor costs (and compliance costs) go up.
Recently New Jersey updated its laws regarding paid family leave. Under the previous law, employers with 50 or more employees were required to provide up to 12 weeks of job-protected family leave. The law has since been updated to include employers with 30 or more employees, which can affect many of the smaller cannabis businesses.
Additionally, the law expands the definition of “family member” to “any individual that the employee shows to have a close association with the employee which is the equivalent of a family relationship.”
Starting on July 1, 2020, the law also increases the paid family leave insurance program to 12 weeks and will increase the benefit rate to 85% of the employee’s average weekly wage, with a benefit cap of ($859).
How Cannabis Business Owners Can Keep Track of Labor Laws
Given how complicated state, local, and federal labor laws are; you might be wondering how to best keep track of it all. Luckily, there are a lot of tools out there to help. For example, you can use your state-specific or labor law attorney websites to keep an eye out, and react to any upcoming changes.
However, websites can often be imprecise, and saying you got your information off the internet is not the best way to defend labor law violations. The only way to truly stay ahead of the regulatory curve is to turn to an cannabis HR business partner or specialist. Hiring an HR specialist can be expensive, and if your company is already skating on the margins that might be too much to afford. Fortunately, Wurk has an entire team of payroll and HR specialists ready to work for you! Our Human Resource Business Partners (HRBPs) can help you maintain compliance with state and federal law by taking care of time-consuming, complicated administrative tasks, allowing you to focus on broader business strategies.
Wurk’s HRBP can handle complex employee relations and people matters, including:
- Employee new hire and termination processing
- Cannabis compensation and job description development
- Federal and State HR compliance updates
- Leadership and development training
- Record retention and employee file maintenance
Regardless of whether you choose to use Wurk or decide to do it all yourself, the important thing is to remember that compliance means more than just cannabis. By staying informed of all the complex state, local and federal labor laws, you can help ensure that your business is not only successful but also compliant with the law!