The cannabis industry continues to grow. Each year we see additional states legalize recreational marijuana. Along with more legalized weed, comes more cannabis employees. And more employees means more employment litigation.
We recently hosted a litigation webinar where I spoke about employment litigation and ways to protect your marijuana business. One of the tools I mentioned was documentation. When it comes to that, one of the most important documents your cannabis business can have is an employee handbook. This is true whether you have one employee or 100.
An employee handbook plays many roles. This post will discuss some of the more important reasons to have a comprehensive employee handbook.
Communication and Orientation
An employee handbook serves as an important communication tool between employees and employers. A well drafted employee handbook will contain a mission statement, along with the values, goals, and expectations of the company and its employees. This communicates a sense of belonging to employees and provides them with an understanding of the goal they are working towards achieving.
The handbook will also communicate the benefits to which employees are entitled as cannabis business workers (free pot is not one of them). A good handbook will explain to employees can question about company benefits. This will save you time as an employer because you won’t have to answer the same questions over and over.
Guidelines and Expectations
One important aspect of an employee handbook is that it creates a uniform set of rules for employees. Employees need to know what is expected of them and when. Employee handbooks should cover everything from attendance requirements to dress requirements and drug use policies. Handbooks should also lay out discipline that can be expected if these policies are violated.
Employee handbooks should provide guidance to employees when problems arise. The employee will know who to talk to and, if properly drafted, supervisors will know how to handle situations.
Legal Protection for Employers
The most important aspect—at least from a lawyer’s point of view—is the legal protections a well drafted employee handbook can provide. In most states, employer employee relationships are “at will”, meaning the relationship can be terminated at any point by either party, as long as there is no discrimination at play. An employee handbook makes it clear that the relationship is “at will” and that other agreements cannot change that relationship.
Employee handbooks also provide the basis for defense in a harassment claim. As previously discussed, a valid defense to harassment claims if proof of an anti-harassment policy and a complaint procedure. Employee handbooks should outline both a policy and a complaint procedure.
Handbooks also provide protection in wrongful termination cases. Wrongful termination is a broad term used to describe cases brought by former employees against employers alleging the employee was terminated for some illegal reason—for example, discrimination. An employee handbook laying out attendance requirements can be used to show that an employee was terminated for violating a clear policy rather than for other, illegal, reasons. If an employer does not have a clear policy, it will be hard to prove the employee violated any such policy.
Employee handbooks can also serve as means to inform employees of required information. Both state and federal laws require employees be informed of their rights under certain acts such as Family Medical Leave Act. Every employee handbook should have an acknowledgement page to be signed by the employee, proving they were provided with the information.
Employee handbooks are not “one size fits all.” Each cannabis business is unique and has a different mission and goal. Further, employment laws are state specific and at times, location specific. There are many drawbacks to pulling a generic employee handbook from the web. A specialist familiar with the state and local laws should draft or review handbook, or the handbook could become a liability rather than an asset.
Handbooks should also be reviewed and revised at least once every two years. Many states, including California and Oregon, have seen an uptick in state employment regulations offering more protections to employees as of late. Laws change quickly and it could mean your employee handbook is out of date and non-compliant if it is not updated frequently.