25 Nov Cannabis Businesses Need Human Resource Management for Payroll and Compliance
As of June 25, 2019, thirty-three states and the District of Columbia currently have passed laws broadly legalizing marijuana in some form.
Click here for a map which shows current state laws and recently-approved ballot measures legalizing marijuana for medical or recreational purposes. States with limited medical marijuana laws, such as those only permitting use of CBD oil, are not considered to have adopted broad medical marijuana laws. Final rules for recently-passed medical marijuana laws are pending in some states.
As an emerging market, the cannabis industry has a lot of gray areas with regard to business – finance, legal, production and even HR. And HR is absolutely essential for payroll and banking, and to ensure legal compliance.
Paying Employees Legally is No Small Task
As indicated in the State Marijuana Laws in 2019 Map, cannabis continues to get legalized throughout the US. However, the federal government still considers marijuana highly illegal, and classifies it as a Schedule 1 drug – the same category as heroin and LSD. As a result, cannabis businesses struggle to pay employees legally within federal and state regulations.
Many well-known banks refuse to do businesses with cannabis operations. And the banks that will do business in the cannabis industry have strict rules on how much money you can deposit, for example. Many cannabis businesses were not aware of this and other rules prior to securing the banking arrangement, and this places growth issues on the business. To get around issues such as this, the business may decide to pay employees illegally (under the table). With illegal payments, it only takes a small instance for the labor board to discover your organization and shut you down.
A cannabis banking solutions partner will take care of all the guesswork in your payroll, banking solutions and HR policies by ensuring you are federally insured.
The issue of compliance is a very big issue in the cannabis business given the legal pitfalls that businesses are likely to encounter with state and local employment law. Are you hiring people correctly? Are you compensating employees correctly? Questions like this can easily be addressed if you make HR policy compliance a top priority.
To map out an HR policy compliance initiative, it’s important to first understand the benefits of having one. These include:
- Liability control
- Controlled budget
- Conflict resolution
- Human capital value
- Performance management and improvement
- Sustainability, and
- Corporate reputation management
By partnering with a provider of tailored HR services and payroll solutions designed specifically for the cannabis industry, the above items will be addressed and will allow cannabis businesses to build high-value human capital while maintaining steadfast principles.
Contact Us today and find out just how cost-effective and comforting our payroll, tax, and compliance solutions can be.