Unions Labor to Grow in SF

The recreational cannabis industry has generally been quite friendly to labor — because the state has forced them to be. For instance, unlike Uber and Lyft drivers, your cannabis delivery drivers are full-time employees who are guaranteed minimum wage and overtime pay, and receive family and medical leave.

This is a legal requirement that was baked into the adult-use marijuana laws California adopted in 2018.

Now there’s another new requirement the state has placed on cannabis businesses. In the annual October batch of new state laws, Gov. Gavin Newsom recently signed a measure demanding that any cannabis business with 20 or more employees must enter a “labor peace agreement,” negotiated by a union or labor negotiator of their choice, to set wages, annual raises, and health benefits.

This state law has actually been on the books since recreational weed was legalized in 2018, but there has never been any enforcement mechanism. A dispensary could just say ‘We’re working on it’ indefinitely, as there was no compliance deadline.

But a new California law called AB 1291 allows state authorities to “revoke or suspend a license” of any cannabis business with a staff of 20 or more if that business does not have a labor peace agreement in place. If a pot business has fewer than 20 employees, they’re still required to send a notarized letter to the state promising they will allow their employees to bargain a labor deal within 60 days of making their twentieth hire.

Ominously, the law also says authorities will enforce the rule “by expanding the scope of the crime of perjury.”

Labor unions have been trying mightily to organize in the cannabis industry since the early days of medical marijuana cards. Before the strict new regulations of the recreational era kicked in, workers often made less than minimum wage, were paid in weed instead of cash, or faced horrifying workplace conditions at remote, rural operations. The first unionized dispensary in the nation was Oakland’s Magnolia Wellness, who joined in 2010.

“Being unionized has been great,” Magnolia Wellness CEO Debby Goldsberry tells SF Weekly. “We are the oldest unionized [cannabis] company in the nation, with satisfied long term employees, comprehensive health benefits, and a supportive environment where staff is always a top priority.

“In my opinion, being unionized is the most definitive way to show your team they matter and to show the community that your company cares about more than just profits.”

Organized labor got a big win with this new state law, but not all San Francisco dispensaries are in the mood to give them high fives. The city’s dispensaries may have good reason to be skeptical of the United Food and Commercial Workers (UFCW) union that represents the cannabis industry.

The most obvious sticking point is an absolutely bonkers 2015 bribery and union-rigging scandal. The UFCW’s leading Bay Area cannabis labor organizer Dan Rush took $600,000 in “loans” from a union dispensary, and blew the sum at Indian casinos and on paying Hell’s Angels’ phone bills, according to an FBI affadavit.

When he couldn’t pay it back, his indictment says he “formulated a scheme to obtain debt forgiveness in exchange for favorable treatment by the union.” Rush pleaded guilty to felony charges of receiving illegal payments, wire fraud, and money laundering, and was sentenced to 37 months in prison.

Some of the mistrust is over the union’s efforts that weren’t necessarily illegal, but crossed several operators with long memories.

In 2015, SF Weekly reported that union officials lobbied the San Francisco Planning Commission to reject an Excelsior District location for the dispensary chain SPARC. The commission did indeed reject the bid, though voiced larger concerns about dispensary “clustering” in the Excelsior.

Four years before that, a leading Bay Area union attorney filed an appeal to block the opening of a dispensary called Tree Med in the same neighborhood. That appeal failed, the shop opened, and went on to become Cookies SF and is now called Connected Cannabis Co.

Some of UFCW’s statewide activities have also rubbed many marijuana businesses the wrong way. The union organized to oppose last year’s statewide cannabis delivery law that went into effect in January, despite their opposition efforts. In recent months, the UFCW has fought hard against cannabis consumption lounge permits in West Hollywood.

The UFCW is a labor organization with 1.3 million members in the U.S. and Canada, best known for representing grocery store workers at chains like Safeway. They threw their support behind California’s 2016 Propoosition 64 that legalized recreational marijuana, helping the measure pass.

UFCW’s Hayward-based chapter UFCW5 established the Bay Area’s “flagship” dispensary union at Oakland’s Magnolia Wellness, and that chapter successfully unionized Oakland’s world-famous pot college Oaksterdam in 2010.

This August, the union announced that “In the past month, four new dispensaries have joined UFCW Local 5.” These included dispensaries in Oakland, San Jose, and Santa Cruz.

But none of these dispensaries are in San Francisco. The city’s cannabis union representation is either minimal or non-existent.

San Francisco’s chapter is UFCW Local 648, whose cannabis union page says that “UFCW Local 648 is fully committed to organizing and representing workers employed in the Cannabis industry within its jurisdiction.” But the site does not list any active member businesses, and UFCW 648’s cannabis division is also exceedingly difficult to reach.

The UFCW 648 cannabis industry contact listed online is no longer with the union. A replacement named in automated bounceback emails does not appear in the office’s voicemail directories.

So SF Weekly popped by in person to UFCW 648’s headquarters at 16th and Mission streets. We got baffled responses from front staff who did not seem aware of any cannabis efforts originating from their office. We left our contact information and a description of our questions, communications that were not returned.

Nor did we have much luck finding any San Francisco dispensaries affiliated with unions.

We reached out to six of the largest employee head-count dispensaries in town to ask their plans for allowing employee labor agreements. Three dispensaries did not respond, and three others declined, with statements like they were “not interested in commenting for this story.”

Two smaller San Francisco dispensaries were once union shops, but no longer are. Post Street’s Grass Roots Dispensary became San Francisco’s first dispensary to join a union in 2011, and Crocker-Amazon’s Mission Organic opened as a unionized store the following year. Both shops confirm their employees are no longer with the union, and declined to comment further.

California unions have given us some wonderful inspiration lately, from last year’s successful Marriott strike action, to getting Kaiser Permanente to grant better health worker benefits, to the Anchor Steam Brewery unionizing efforts. And now, cannabis labor protections the unions fought for are enshrined in law with AB 1291.

But union memberships have been plummeting for decades and have hit record lows. This new law could help cannabis industry employees, or might just be a way for unions to keep their membership numbers from going up in smoke.