Perks of the Trade: Employee Benefits in the Cannabis Industry

Cannabis companies are serious about finding and keeping good employees.

cannabis flowers, mg magazine

As more states legalize cannabis and the markets in legal states continue to mature, the industry is experiencing a commensurate rise in job postings for every type of employment. The trend will continue. New Frontier Data projects that by 2020, just two years from now, the number of new jobs created by the cannabis industry will eclipse those created by the nation’s entire manufacturing sector. Is it any wonder, then, that trade events increasingly tack job fairs onto the regular schedules? Their exhibitors and sponsors are hiring or preparing to hire. No one is downsizing!

The industry’s rate of growth also is accelerating. Per data provided by cannabis staffing agency Vangst, the industry produced a 690-percent increase in job listings between January 1, 2017, and August 1, 2018. The surge in new jobs led to an increase in the average salary, up 16.1 percent during that time frame. For 2019, Vangst anticipates another 220-percent jump in job postings, adding further upward pressure to salaries, which will entice more top-drawer mainstream talent to consider a career in cannabis. That will, in turn, create increased competition among cannabis companies to find and keep the best talent. The dynamic may play out at every level in the cannabis employment food chain, from trimmers and drivers (delivery and distribution) to store managers, compliance specialists, and directors of cultivation, to name but a few.

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Because there is no employee handbook for the cannabis industry, no universally accepted standard of employment protocols to lean on, companies are left to establish standard operating procedures (SOPs) on their own. They may hire permanent staff in one location while outsourcing the same jobs in another. Similarly, at the executive level, new hires enter a world in which compensation varies greatly based on still-evolving norms, a situation that could work to their advantage but which certainly leaves room for creative, individualized environments.

In the end, each company must determine for itself how to attract and keep talent. Compensation will play a large role, of course, as will benefits and special perks offered by the company, and so will company culture.

Using data culled from employers in six cannabis-legal states, Vangst reported 71 percent of cannabis companies offered medical insurance to employees. Additionally, 51 percent provided dental insurance for full-time employees, 46 percent offered vision insurance for full-time employees, and 46 percent of the companies offered all three types of insurance to full-time employees; 21 percent offered no insurance at all. Twenty-nine percent provided either 401K or stock option plans.

“When you create a positive and professional work environment for employees, your company’s reputation and culture will attract great people,” said Kerry Arnold, “chief people officer” for Canndescent, a large-scale cultivator in California with grow sites in Desert Hot Springs, offices in Santa Barbara, and plans for retail expansion. “Although it sounds simple, it requires constant attention, care, and a continuous collective effort to develop a strong culture. Every employee at Canndescent is a steward of our culture and values.”

Arnold said the company, which is hiring, has been on the receiving end of the great migration of workers into cannabis. “This industry is attracting great talent,” he said. “People are crossing over from [consumer packaged goods], pharma, wine and spirits, and other long-standing industries. They are interested in the new and exciting opportunity to be a part of the hyper-growth stage of the business.”

According to Arnold, the top three factors prospective employees consider are:

  1. The desire to be part of a winning team.
  2. Opportunity for professional growth and development.
  3. Employment where they can make a difference and have an impact.

Those interests, he said, work to create a positive and effective environment. “When your employees are passionate about the product and services the business offers and feel recognized for their contributions that make an impact, you are able to retain passionate employees and create a great culture,” Arnold said. “Earning opportunity and benefits are important, but that alone will not retain your best people.

“It is also important to continue to innovate in relation to talent engagement and attraction,” he added. “LinkedIn, Instagram, Facebook, as well as other social channels, are great ways to connect with potential talent and key influencers. We believe in leveraging our current employees to engage with their networks and refer people they believe would fit our culture well.”

Attention to detail also is imperative to avoid costly hiring errors. “The worst mistake companies can make is poor or no onboarding,” said Arnold. “Effective onboarding is the single best thing you can do for new employees in their first sixty days to set them up for success and improve retention. When an employee accepts a position with your company, it’s a big deal and even life-changing for many new employees. They are often leaving a job or relocating. They are excited, but also worried. During their first weeks on the job they will be asking themselves, ‘Did I make the right decision?’”

The problem, he added, is “many companies drop the ball with onboarding. We’ve all seen or experienced it first-hand: An employee shows up on their first day with no business cards, IT equipment, training, or a schedule to properly get the new employee acquainted with the people and the business. When this happens, engagement levels drop and you are one step closer to losing a recruit.”

It all starts at the top and runs downhill, according to Arnold. “Organizations that tolerate poor behavior with supervisors and leaders are sure to have a retention problem,” he said. “Bad supervisor-employee relationships are still the number one reason employees leave a company. Also, nobody wants to work for a jerk. Have high standards for supervisors and a no-jerks-allowed philosophy.”

Even though Canndescent’s main facilities are in remote Desert Hot Springs, which is about a half hour north of Palm Springs, there is no lack of job-seekers. “We typically get 100-plus applications within days of positing jobs locally,” said Arnold. “For harder-to-find positions, we conduct a national search. We have also been successful attracting people from out of the area, and even out of state.

“We are grateful for the opportunity to have been the first cultivator to open its doors in Desert Hot Springs and have been very fortunate with both the quality and quantity of [job] applicants,” he added. “With new cultivators opening their doors, there will be a tight market for talent in the near future. Having a strong and well-thought-out employer value proposition will be key to attracting and retaining good people. Canndescent has very low turnover and a highly engaged team. Our flexible recruiting strategies, strong value proposition, and flourishing culture have enabled us to fill even the most difficult roles.”

Currently, Canndescent employs 140 people. “By [December], we’ll be at 150-plus,” said Arnold. “We have twenty-five open positions ranging across sales, marketing, finance, corporate development, human resources, operations, and distribution.”

Mile high culture

incredibles, an established Colorado-based producer of cannabis-infused edibles, extracts, and wellness products, also has a footprint in a half dozen other states. With a core employee base of about 150 people, the company has been a real-world cannabis human resource laboratory for years and is confident it has developed a reliable recipe to keep employees happy.

“We are a family,” said founder and CEO Rick Scarpello. “We’re here for each other. We turn to each other in time of need. Have fun with each other, then go out and get to know each other better. We have this very common denominator of cannabis and are getting to do something not a lot of people on Earth get to do: start an industry. So, passion is the correct word to have around here. I tell people to walk around here with passion and make decisions like you own the place. That’s what I want here.”

It seems to be what everyone wants. “People like to contribute to something they believe in and someone they believe in,” said Scarpello. “One thing I’ve always said is employees work for a paycheck, but that’s not what keeps them. The work environment is critical for someone to want to stay. You have to enjoy wanting to come to work. Yes, you need to make a living and pay the bills, but if you hate your life going in to work every day—and everyone reading this has experienced that—when you find a way to leave, you leave.”

That’s not the only maxim at play in the incredibles culture by far. “The number-one priority in life should be your health—spiritual, physical, and mental,” said Scarpello. “Second should be your immediate family, and then the third most important thing in your life can be a career and other things. Of course, you juggle these priorities as life hits you.”

He also listed a non-hierarchical culture based on mutual respect as vital to creating a desirable work environment. “Another thing I do is respect each person,” he said. “I think young people—and I’m saying younger than me [chuckle]—deserve respect. I think all people deserve respect from you until they show you they don’t deserve it. I think the people on the front lines of this company are doing some of the most important work of this company. I once had a company attorney tell me [the attorney was] the most important employee in the building. I said back to that person that right now the janitor is the most important person because we are short-handed, and the place is dirty. I don’t think it’s healthy for any of us to be full of ourselves. People are people, and we need to treat each other with love and respect.”

While Scarpello did not want to emphasize company benefits, which he re-stated are “important, but not at the top of the list,” he did express pride in what he admitted are “some pretty cool perks.”

He listed a few choice ones. “We give our employees insurance. We have employee discounts for products. We do a monthly employee lunch where we feed everybody with a food truck or something. We have a very personal Christmas party and give out bonuses. We have paid holidays and options for life and dental insurance. We do employee get-togethers like going to the Rockies [baseball] game or other events.”

He saved the topper for last: “We have an employee breakroom that is a non-licensed business where people can use their medicine in the middle of the day, if needed.” It all adds up to an environment in support of the company’s philosophy of employment. “Overall, we judge your work performance, but we don’t judge you,” Scarpello said.

Humans at work

Creating the right culture at work sometimes can be messy, however. At a recent company meeting of a Los Angeles-based legal dispensary, the staff of about fifteen sat informally in the main area of the shop as managers went through a list of items on the agenda. The item saved for last required the owner to step forward and address the staff.

“If you need to find a boyfriend or girlfriend, you have all of Los Angeles! Don’t bring it into work,” he warned.

Of all the issues that had led to the business letting employees go, socializing was the number one culprit, he later revealed.

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