● AUGUST 27, 2023
In eight years of work in the legal cannabis industry on the west coast, I thought I had seen it all. Then the news broke in May about the Professional Technical Union Local 33 (ProTech) and now in August about the National Agricultural Workers Union (NAWU). ProTech and NAWU lined up contracts with numerous California cannabis licensees as a part of the Department of Cannabis Control’s (DCC) labor peace agreement regulations. Any licensee with more than twenty employees is required to have a labor peace agreement in place with a valid union.
Labor peace agreements need to be completed with bona fide unions, defined as those that demonstrate “a sincere and good faith intent to organize and represent employees as a collective bargaining representative, including the capacity or ability to do so.” In the case of ProTech, the “union” failed to respond to even basic inquiries about membership and organization. According to the recent reports, NAWU has no dues paying members and consists of a single person, Sean McNally, who happens to be an attorney who was involuntarily relieved of his license to practice law by the State Bar of California.
Now, all of the companies who submitted a labor peace agreement to DCC that linked them to ProTech or NAWU are scrambling to clean up the mess or risk harm to their licenses. In practice, the licensees will likely just sign new labor peace agreements with legitimate unions and be allowed to continue operating, but the door has been opened for DCC to make things interesting if they choose that path.
By the letter of the law, these licensees were operating in violation of the regulations for extended periods of time. DCC could likely seek fines, suspensions, or even revocations if they wanted to send a signal to the industry. No part of me believes that will happen, but an enforcement officer looking to make a name for themselves could see it as an option. What adds to this scenario is that one of the larger companies swept up in this mess with NAWU is Caliva, which happens to be owned by The Parent Company, which includes Jay-Z as a shareholder.
California licensees should see this as a warning shot and an opportunity to verify their own labor peace agreements are with legitimate unions. A good starting place would be to request information about membership in the union. If this request is met with resistance, you should likely consider a new union for your labor peace agreement.
– Matthew Cleary