Progress, Obstacles in Cannabis Industry Unionization Push

This summer saw encouraging steps forward in the drive to unionize the fast-growing cannabis industry. 

Workers at Cultivate Holdings‘ grow facility and retail outlet in the central Massachusetts town of Leicester voted to affiliate with Local 1445 of the United Food & Commercial Workers Union (UFCW). The grow facility was one of the first state-legal adult-use dispensaries on the East Coast.

“This is not just a victory for cannabis workers at Cultivate, but for all cannabis workers. We’ve set a precedent by working collectively that enables us not only to survive but to thrive,” Craig Chaplin, a Cultivate employee, told MassLive.com on Aug. 11.

The UFCW is at the forefront of the unionization effort in the industry and has launched a Cannabis Workers Rising campaign. The UFCW, which calls itself the United States’ largest private-sector union, represents 1.3 million people who work in supermarkets, meatpacking plants, food-processing facilities—and cannabis dispensaries, mostly on the West Coast.

The UFCW has been organizing cannabis workers since 2010 and currently claims to represent tens of thousands employed in the industry—but progress has been limited. The International Cannabis Business Conference estimates 243,700 full-time-equivalent jobs supported by legal cannabis coast to coast as of January 2020.

Only the agricultural employees at Cultivate voted to unionize, although UFCW officials said there is an ongoing campaign to organize the retail workers as well. Local 1445 secretary-treasurer Fabricio DaSilva told MassLive the union is confident more workers will want to join those “who will benefit from organizing this emerging industry.”  

The previous month saw two similar advances. In July, some 60 workers at the New England Treatment Access cultivation facility in the town of Franklin, southwest of Boston, voted to join Local 1445. Earlier that month, employees at Mayflower Medicinals in Holliston, west of Boston, also joined up with the local. 

Last year, more than 100 workers at Sira Naturals in the towns of Milford, Needham and Somerville became the first in the Massachusetts cannabis business to unionize, signing up with Local 1445.  

Accusations of Anti-Union Tactics

But this July, workers at NETA’s Brookline dispensary voted 30-9 not to unionize—despite months of organizing efforts. And, as reported by MassLive, Local 1445 accused NETA management of firing or threatening employees at their facilities over their unionization efforts. 

In a statement, NETA denied the charges. “We support everyone’s right to join or not join a union, but because NETA already offers progressive wages and benefits, as well as a collaborative work environment, we don’t think a union is needed,” the company said. “We are in the middle of a union-organizing campaign and union tactics such as filing complaints are not uncommon.” 

NETA and Local 1445 also battled it out over who would be eligible to join the union, and whether the voting process could take place by mail-in ballot in light of the coronavirus pandemic. In a May decision, a regional director for the National Labor Relations Board (NLRB) ruled to allow voting by mail and found the disputed employees—including a lot attendant and security personnel—could take part in the election. 

Local 1445 saw these challenges, and the alleged retaliatory harassment and dismissals, as signs of bad faith. “Companies do that to send a kill effect into the campaign,” DaSilva told MassLive. “People are getting fired because they are joining a union.” 

The Boston Globe noted back in February, that there were similar claims against Mayflower Medicinals and its parent company, iAnthus Capital Holdings. In a formal complaint to state regulators that month, Local 1445 said managers at the Holliston facility issued written warnings to two workers involved in the unionization effort for alleged minor infractions that “do not normally lead to discipline.”

The union, in its filing with the state Department of Labor Relations, said the write-ups were part of an illegal anti-union campaign by Mayflower managers that also included interrogating employees and even explicitly instructing some to stop engaging in protected organizing activity.  

The Federal Recognition Dilemma

Mayflower employs about 45 workers at its Holliston facility, which recently won a state license to expand from medical marijuana into the adult-use market. The company also operates a medical dispensary in Boston’s Allston neighborhood and expects to open an adult-use outlet in Worcester this year.

The unionization drive at Mayflower won support from the company’s 17 agricultural workers, who are exempt from many federal labor laws but protected under stronger state laws. 

The remaining 28 employees at the facility, such as those who process harvested flower into edibles and oils, also signed cards expressing their desire to unionize—but were reluctant to proceed to a formal union election overseen by the NLRB, as management wanted. That is because cannabis remains illegal under federal law, and a ruling by the NLRB that workers at state-licensed facilities are ineligible for labor protections could set a very bad precedent for the unionization drive nationwide. 

Local 1445 was instead hoping to pressure Mayflower into signing a state-recognized “Labor Peace Agreement,” under which the company would vow to recognize the union if a majority of workers voted to form one. A precedent for this was set when Sira Naturals entered such an agreement last November, as the Globe reported at the time. 

However, Mayflower declined to enter a Labor Peace Agreement, and the election was held under NLRB oversight—which could spell trouble down the line.

Whither Labor Peace Agreements?

US Chamber of Commerce page defines a Labor Peace Agreement (LPA) as “an arrangement between a union and an employer under which one or both sides agree to waive certain rights under federal law with regard to union organizing and related activity. While these agreements can be negotiated voluntarily, some state and local governments have attempted to impose them on employers by passing labor peace ordinances.”

law passed in California last year requires cannabis businesses with 20 or more employees to enter into a Labor Peace Agreement with a “bona fide labor organization”—UFCW locals, in most cases. The LPA requirement for the city of San Francisco applies to cannabis businesses with 10 or more employees. 

New York’s Compassionate Care Act, which established a limited medical marijuana program in the Empire State in 2014, also included a provision mandating LPAs.

However, in Michigan, a proposed requirement for cannabis businesses to enter an LPA was removed from the final version of regulations for the adult-use sector that took effect in June. The controversy over the provision revealed much about divergent views on organized labor across America’s partisan divide—although it was certainly an irony to see conservative Republicans coming to the defense of bosses in the cannabis biz. 

The state’s Marijuana Regulatory Agency director Andrew Brisbo told MichicagnLive, “a Labor Peace Agreement is an agreement between an operator and a recognized labor organization to ensure that both sides come to the table.” Republican state senator Aric Nesbitt countered: “These labor peace agreements are really a Mob-style shakedown of these new businesses that are growing. At least the Mob lets you get going first. They won’t even issue a license unless you sign one of these labor peace agreements.”

In a significant ruling that represented an advance in resolving the federal jurisdictional dilemma, a US appeals court in Denver last year, held that protections under the Fair Labor Standards Act apply to “all workers”—including those in the cannabis industry. This 1938 law was a keystone of President Franklin D. Roosevelt’s New Deal, establishing a minimum wage and overtime pay for full-time workers nationwide.

The Automation Threat

Meanwhile, another and more insidious threat to labor in the cannabis industry has just reared its head. UPI reported last month that cannabis vending machines are coming to dispensaries in Colorado and Massachusetts, to offer customers “contactless buying.” A Boston-based company called anna debuted the new machines at Strawberry Fields in Pueblo, Colo., where customers can now buy flower, edibles and vape oils without interacting with a salesperson. More are to be installed in other dispensaries later this year, the company said. 

Matt Frost, founder and CEO of anna, said the machines are intended for “experienced cannabis customers who don’t necessarily need that one-on-one interaction with a budtender.” He emphasized the need to minimize person-to-person contact due to the COVID-19 pandemic. Customers will only need to check in with a representative in person to provide photo ID before using the machine, according to Legal Reader.

The machines are likely to be attractive to Massachusetts dispensaries, which topped $785 million in total sales since adult-use cannabis hit the legal market in the state in November 2018 and $320 million so far this year.

Similar concerns have been raised about the advent of so-called “robopot“—grown in highly automated cultivation facilities. 

But the Boston Business Journal warns that “the automation could undermine a wave of unionization efforts underway at dispensaries throughout the state.”

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