If a California cannabis business wants to get a license, it will have to let its employees unionize. That’s according to a new state law signed by Gov. Gavin Newsom this week. The bill requires cannabis dispensary applicants to file a statement that it will enter into a Labor Peace Agreement with unionized workers as soon as the company hires 20 employees. Once a company reaches the 20 employee threshold, license applicants will have 60 days to enter into the agreement. The new law makes it easier for California cannabis employees, who work in one of the country’s fastest-growing industries, to unionize.
Unions Look to Grow Membership with Cannabis Industry Workers
Traditionally, labor unions and the companies of the workers they represent have competing interests. Companies want to make as much money as possible, which typically means paying their workers as little as they can get away with. But the cannabis industry is somewhat of an exception to this rule. Because of the federal prohibition on cannabis, employers in the cannabis industry do not have access to federal subsidies, such as those for health care coverage. Unions can help secure benefits that employers have a difficult time providing. As a result, cannabis workers looking to unionize are facing relatively little resistance from employers.
It’s a situation that major unions, like the United Food and Commercial Workers International Union, are taking advantage of. UFCW, in fact, has been one of the driving forces behind efforts to get states to mandate unionizing cannabis employees. Seeing the rapid growth of the cannabis industry as a prime opportunity to swell its ranks, UFCW has emerged as the most powerful cannabis union in the country after it began organizing industry workers in 2011. The union now represents more than 10,000 workers across 14 states, according to Rolling Stone.
And California’s new law stands to boost UFCW’s membership even further. But that won’t necessarily translate to more bargaining power for workers. Under the new law, cannabis workers and cannabis companies that cross a 20-employee threshold must enter into “labor peace agreements,” or LPAs. As the name indicates, these agreements are designed to defuse in advance any antagonisms between unions, workers, and employers.
With an LPA, companies agree not to stop or otherwise discipline or dissuade employees from unionizing. Companies even have to let union organizers meet with employees in the workplace. But in return, unions agree not to encourage labor strikes or other actions against employers. Technically, unions can’t even criticize companies to their members under an LPA.
Workers Unions Provide Many Benefits for Growing Cannabis Industry
In short, LPAs, like the kind now mandated under the new California law, makes it easier for employees to organize. But it’s all about growing union membership, rather than using that leverage to compel employers to treat their workers more fairly.
Still, LPAs and the easier road to union membership they provide offer several benefits to the rapidly growing cannabis industry. In the first place, unionized cannabis employees have been able to negotiate higher wages—in real dollars, not just “weed paychecks”—and annual raises, health insurance subsidies, paid time off, employer-funded retirement plans and more. Those benefits help attract and keep qualified workers, which helps reduce turnover in an industry where turnover is exceedingly high.
Union-negotiated employee benefits also help legitimize cannabis businesses and efforts to expand legal access to cannabis products. And they also benefit cannabis consumers by ensuring the availability of safer, better-regulated products. In fact, one of the earliest labor disputes in the legal cannabis industry erupted over employees’ concerns about their employers’ shady pesticide use.
Cannabis employees are unionizing across the country, and that’s a sign of a healthy trend in the $6 billion-and-growing industry. Unions help ensure neither workers or consumers get taken advantage of by unscrupulous companies. And it helps ensure jobs in the cannabis industry are good jobs. Workers are unionizing across the country. And for the moment, they’re doing it with the help of politicians. So far, both New York and California have passed laws requiring cannabis employers to sign LPAs. And unions like UFCW are ramping up recruitment efforts.