Employee Management & Human Resources: An Often-Overlooked Part of Building a Business

Employee Management & Human Resources: An Often-Overlooked Part of Building a Business

Long before a cannabis business wins a license application, it needs to create a traditional business plan that outlines how the company will operate. This obviously includes things like real estate, buildings, products, and inventory, but it also includes many things that are often overlooked, such as payroll, human resources, and employee management.

Before a cannabis company hires its first employee, several things need to be resolved. While the timeframe and order of operations will vary by company and state, there are many things to consider, including employee compensation, employee training, handbooks, and of course everyone’s favorite topic, insurance. These include crop insurance, general liability insurance, unemployment insurance, and workers’ compensation insurance. Working with the right broker and understanding what you need and when, without breaking the bank, is critical to keeping your doors open.

in advance of cannabis quality conferenceSo we asked Nick Murer, founder of WECO, a few questions about what businesses need to know and when. Nick will be answering these questions and many more when he participates in the Ask the Expert Roundtable event in New Jersey on October 17th and 18th.

Cannabis Industry Journal: Are businesses required to carry workers’ compensation and unemployment insurance before obtaining a license?

Nick Mueller: You don’t need to understand it before getting your license, but you should know what you need to accomplish and have a strategy in place as you move through the process. In some cases, states may require upfront insurance during the licensing process, but this is not always the case. However, you need to get insurance before you start your business, and it is absolutely necessary to get insurance before you staff up and have your first employee.

CIJ: What types of insurance should companies consider when submitting a license application?

Nick: Make sure you understand that, or at least discuss your options with your broker when you submit your license application. Since you are not a corporation, you may not have it yet, but you will need general liability insurance. If you are a grower, you will also need to purchase crop insurance. Before you open your business, you’ll need to talk to your state about workers’ compensation insurance, unemployment insurance, FICA, SUTA, and FUTA. Before you get your license, you need to make sure you work with the right insurance broker and have your costs under control. We can help you with that. We work with some great industry-specific brokers. As you move through the licensing process, it’s important to work with people like us who have the right resources and the right tools to provide you with the support you need.

Nick Murer will be attending CQC in New Jersey October 16-18 to answer questions and provide resources for new and existing businesses.During the application process, you should be aware of your insurance and available options and what you need, but you may not need to have it all ready. It varies by state.

CIJ: What important parts of human resources and employee management should companies have understood before obtaining a license?

Nick: I think the first thing you need to start with is making sure you have workers comp and GL set up. [general liability insurance] Before hiring employees, you should create an employee handbook, determine onboarding procedures, and develop a termination strategy. We step in and help these companies handle workers’ compensation, unemployment insurance, FICA, FUTA, SUTA, Social Security taxes, health benefits, and work properly with states to deploy all of that. It’s about making sure that you do. neatly within 30 days. We work with many clients to ensure they fully understand their onboarding program before making the leap.

CIJ: What HR functions are often overlooked as cannabis companies obtain licenses and begin operations?

Nick: I think the most important thing you need to understand in your hiring process before hiring someone is to create a thorough and compliant handbook that your employees have been involved in and worked on creating better documentation. Understand the expectations and standards you must meet to be successful as part of a team. To stay compliant, I think you need to understand what’s going on between onboarding, timing, and required documentation all before the effective date and adjust your employment onboarding practices. Understanding labor compliance and being able to understand how to properly onboard and exit employees is a really important part. What we want to help our clients with is help train managers and be a resource for our clients. Because everyone works with humans, unexpected problems always arise. We are in the people business and people problems are bound to arise. Mitigating them should be everyone’s top priority. The more we can help protect cannabis businesses, the less risk they pose to our companies, our people, and our industry.

With two decades of dedicated experience, Nuggs is a seasoned cannabis writer and grower. His journey has been a harmonious blend of nurturing cannabis from seed to harvest and crafting insightful content. A true expert, they've honed strain-specific knowledge, cultivation techniques, and industry insights. His passion shines through enlightening articles and thriving gardens, making them a respected figure in both the growing and writing facets of the cannabis world.

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