21 Apr 5 Reasons Why Your Cannabis Business Needs a PEO to Manage HR
The Marijuana Business Factbook reports that the estimated number of full-time workers in the U.S. marijuana industry was between 175,000 to 215,000 in 2019. The report projects this number will more than double by 2023.
As the cannabis industry continues to progress, the demand for hiring employees to ensure operations run smoothly has significantly increased. More than ever, human resource management has become an essential function of the business. But, because cannabis operations continue to be highly regulated, most businesses remain small and may not have the financial resources to hire a dedicated an in-house HR professional.
Fortunately, a Professional Employer Organization (PEO) is an optimal solution not only for small businesses, but for cannabis operations. A PEO is able to manage the day-to-day HR administration, recruit and hire the best talent, and protect your business from compliance risks. But, if you have questions on why you might offload your HR function, continue to read this post for five reasons to partner with a PEO.
5 Reasons You Should Hire a PEO to Manage Human Resources
In partnering with a PEO, you can expect that they will:
1. Ensure your business is compliant with cannabis regulations. To operate as a cultivation site or as a dispensary, there are certain legal standards to uphold. As a dispensary, applying for a license is only half the battle. There are regulations on what you can sell, where you can sell, and who you can sell to. Every regulated cannabis market also has its own tracking and reporting requirements to report activity, sales, and inventory to the government. It can be overwhelming to learn the different requirements and regulations, especially if you have dispensaries in different states. Fortunately, a PEO is knowledgeable in cannabis compliance and works to stay updated on the ever-changing industry.
2. Keep current on employee law to protect you from lawsuits and litigation. As a business owner or operator, you have to abide by several employee laws like the Fair Labor Standards Act (FLSA), the Family and Medical Leave Act (FMLA) and the Health Insurance Portability and Accountability Act (HIPAA). The FLSA, for example, includes standards for minimum wage, overtime pay, record-keeping, and employee classification. Many cannabis operations consider their employees as contractors, but that comes with a different set of criteria to uphold as well. A PEO is skilled in employee law and ensures your business stays compliant. Not only that, but they follow the proper procedures to ensure all employees have the correct paperwork completed like an I-9 verification form, a background check, W-4, and confidentiality agreement.
3. Recruit and hire the right talent based on your business’ needs. It is currently challenging for cannabis operations to recruit the best employees, and not because the talent is unavailable, but because cannabis operators may not be skilled in talent management. A robust job description that contains all the necessary elements to find the right fit is essential. A PEO is knowledgeable in what is required in all job roles, whether you’re hiring for a dispensary or a grow room. They know that if the role requires an employee “to touch the plant,” then they have to abide by strict laws in handling and processing, so not just anyone can apply and fill the role.
4. Provide consistent employee training for your business to succeed. Regardless of experience, every employee should have ongoing, consistent training to keep them knowledgeable in their role and to help benefit the business. Budtenders should not only be trained in the different strains of cannabis, but also in customer service to be able to educate and connect with customers on a personal level. Workers at a cultivation site or grow room not only need to be skilled in their job role, but they also need to be routinely trained on health and safety as these sites can have a significant number of occupational hazards present.
5. Support and retain a healthy workforce, by offering employees comprehensive benefits. In the cannabis industry, where turnover is high and it’s expensive to constantly replace and train new employees, offering a competitive benefits package will not only attract and retain good talent, but it will also keep your workforce healthy and productive. A PEO recognizes the need to maintain a strong culture, but also knows that cannabis businesses are challenged with finding suitable and affordable benefits packages due to a lack of providers. Therefore, a PEO can step in and work with a cannabis owner to offer competitive health insurance and 401(k) plan options that are tailored to a business’ workforce, industry, and location. More importantly, with a PEO’s help, cannabis businesses have access to the same quality health insurance coverage and retirement benefits as much larger organizations, at a more reasonable cost.
Learn More About Partnering With a PEO. Contact OROleafhr.
Hiring a PEO offloads a significant amount of HR responsibilities, but they’re much more than a third-party vendor. A PEO is your partner in helping your cannabis business thrive. The services they perform can reduce administrative costs, improve operational efficiencies, and keep your employees happy.
Partner with OROleafhr for your HR and compliance needs. Our programs specialize in HR management and operations that support and grow your cannabis business. Enjoy cost-effective HR services like benefits administration, payroll, tax compliance, and risk management. Get peace of mind that your HR function is in good hands.
Outsource your HR needs and focus on building your business. Download our eBook “7 Signs Your Cannabis Business Needs to Outsource HR to a PEO” to learn how.