“Sham Unions”: Alleged Labor Law Violations Shake California’s Booming Cannabis Industry
September 20, 2023 | Cannabis Law Updates
Article by: Associate Michael A. Carlin
Several major legal cannabis companies in California are facing allegations of violating state law by collaborating with and signing labor peace agreements with organizations claiming to be labor unions but who have failed to genuinely advocate for workers’ rights. According to California law, cannabis companies with over 20 employees are required to sign a labor peace agreement with a “bona fide labor organization”. These labor peace agreements facilitate a union’s access to employees. Labor peace agreements prevent unions from picketing or boycotting the business in exchange for the business agreeing not to disrupt union organizing efforts. However, several unions are alleging some of the largest cannabis companies in the state have attempted to skirt this law by signing labor peace agreements with an organization known as Professional Technical Union Local 33 (Pro-Tech).
The Teamsters Union filed a complaint with the California Agricultural Labor Relations Board (CALRB) in March of this year, alleging that Pro-Tech was not a genuine labor organization. After conducting an investigation, the CALRB agreed with the Teamsters, finding that Pro-Tech has made no tangible efforts to organize or represent cannabis industry employees and even lacks a physical presence in the state.
At least 90 cannabis companies, including some of the largest in California, are alleged to have signed labor peace agreements with Pro-Tech and have recently had to scramble to make agreements with other labor unions. The implicated firms were provided with 180 days to establish new labor peace agreements by the California Department of Cannabis Control (CCDC).
Pro-Tech is not the only labor organization to face scrutiny. Another union, the National Agricultural Workers Union, has also recently faced similar allegations of being a “sham union” from the Teamsters.
California’s cannabis industry is significant, employing over 83,000 people in 2021. The CCDC has stated that it is working to enhance transparency regarding labor peace agreements to strengthen labor organizations’ ability to file complaints against non-compliant companies.
This news highlights the importance of having an experienced attorney review labor peace agreements that are required by CCDC. It is important to remember that the details of these agreements are subject to negotiation, and the difference between an enforceable agreement and a one-sided agreement that allows a union to engage in unfair or harassing organizational tactics can be easily overlooked.
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