HR Services for Cannabis Businesses

Human Resources (HR) has an essential and specific function in the cannabis industry. Unfortunately, many cannabis business owners are woefully unaware of how vital HR is to their business. This is the primary reason why many cannabis businesses are being dinged for noncompliance with employment law

Simply put, if you run a cannabis company with five employees or more, you need to shift your focus to developing your very own human resources department. Many legal nuances must be addressed, or you could find yourself failing an audit by the Department of Labor. 

In many instances, the owners of smaller cannabis companies (around five to seven employees) wear multiple hats in the organization; one of which involving the role of HR manager. That means they’re managing leads, hiring, firing, recruiting, and so on. 

While admirable, these individuals aren’t trained in HR law. One mistake could lead to a lawsuit that could completely shut down their business.

The Lack of HR in the Cannabis Industry

The cannabis industry is still relatively new, which means there are plenty of small-time operations that are still figuring out the lay of the land. One of the more popular practices is to outsource services that require specialists such as payroll and accounting. 

HR is often neglected. Cannabis company owners tend to be more so focused on the ever-shifting laws and regulations concerning the legality of cannabis and may neglect other aspects of their business as a result.

Employee Turnover

Many cannabis companies are focused on one thing – increasing their bottom line. As such, expenses that shrink revenue are often pushed to the side. HR is one such investment that is often seen as a waste of money by many smaller scale cannabis operations. 

That couldn’t be further from the truth, however. By investing in HR, cannabis businesses can actually save money. 

Imagine the time and money it takes to vet, hire, and train an employee. Let’s say it costs your business roughly $8,000 to fully train an employee during a six-month period. You will also have to factor in the cost of the individual training the new employee. Let’s say that’s an additional $6,000.  

What would happen if that employee suddenly quits due to an unresolved work dispute? That would mean you wasted six months of time that could have been dedicated to developing your business. That also means you just flushed $14,000 down the drain. 

And guess what? You would still need an employee to fill that position which means you would have to vet, hire, and train an entirely new employee all over again. How many times would you be willing to flush $14,000 down the drain? 

Investing in HR may seem extraneous from the surface, but when you start to crunch the numbers, you’ll realize that having an HR solution on hand could lead to a healthier work environment which in turn could lead to a decrease in employee turnover.

Lawsuits, Lawsuits, Lawsuits

Lawsuits are one of the primary reasons businesses in the cannabis industry should invest in an HR solution. Imagine if you encounter a situation involving hiring discrimination, sexual harassment, or a payroll dispute. 

How would you handle it? What happens if you’re not able to resolve the issue in a timely enough manner to stop your employee from suing you? 

If you’re a small company, a lawsuit can wipe you out, plain and simple. One of the jobs of HR is to settle disputes and to ensure you’re providing a healthy work environment for your employees. 

Your HR department is also responsible for catching possible mistakes you may make during the hiring process, such as hiring discrimination (we’re only looking for young passionate cannabis enthusiasts!) which could also lead to a lawsuit that could put you out of business.

Resolve Your HR Problems with HR 360

We understand if hiring a fulltime HR manager may be a bit of a strain on your budget. That’s where HR 360 comes into the picture. HR 360 is an all-in-one HR department that you can access from your computer. 

It gives you access to hundreds of forms, sample policies, and checklists to keep you compliant with the law. 

HR 360 also provides an employee handbook that provides guidelines for proper employee etiquette. Essentially, HR 360 is the next best thing to hiring an HR professional, allowing you to decrease employee turnover, avoid lawsuits, and stay compliant with employment law.

Getting Started

It’s time you stopped ignoring your HR needs. It’s costing you money, and could even lead to your business being shut down. By partnering with Cannabis Connect Insurance, you will receive a subscription to HR 360’s extensive attorney-developed library where you will be able to access everything you will need to develop your very own HR department.

In addition to recognizing the importance of HR for your business, you will also need to consider investing in insurance to provide additional coverage.

Get a Quote Today

If you’re looking for a team of specialists who can help you craft a comprehensive insurance package, contact Cannabis Connect today for a free quote.

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