As legalized marijuana spreads across the United States, laws in some states have started to bolster the power of unions in the cannabis industry. These laws often require a business to reach a "labor peace agreement" or adopt a similar stance toward unions in exchange for receiving a cannabis license from the state. Under a labor peace agreement, a business agrees with a union to refrain from interfering with its organizing efforts. For its part, the union agrees not to interfere with the operations of the business. Labor peace agreement laws are not unique to the cannabis industry. They already play a role in the hospitality industry in some states. Other states not only have refrained from enacting these laws, however, but also have prevented local governments from enacting them.
States that have enacted laws supporting unions in the cannabis industry include California, New York, New Jersey, and Virginia. While California and New York specifically mandate labor peace agreements, New Jersey and Virginia provide more general protections. Several other states, such as Massachusetts, Connecticut, and Minnesota, are considering similar laws. While Illinois and Pennsylvania do not require labor peace agreements, cannabis businesses in those states have advantages in the licensing process if they reach these agreements with unions.
California Labor Peace Agreement RulesAn example of a labor peace agreement law is a recent provision in California. A cannabis business there must allow the union to communicate with its workers in an effort to organize them and represent their interests. A business must grant access to its facilities to union organizers. In exchange, the union must refrain from work stoppages, picketing, boycotts, and other traditional tactics used to pressure businesses.
Barriers to Unionization in the Cannabis Industry
While unions benefit from labor peace agreements, some challenges to unionization in the cannabis industry persist. Many employees in the cannabis industry are classified as agricultural workers, which means that federal unionization rights under laws such as the National Labor Relations Act do not apply to them. Moreover, a cannabis business does not need to encourage or compel employees to join a union, and many of these laws require unions to abandon certain tactics that can help them during contract negotiations. Once they have organized a workforce, therefore, they may not have enough bargaining power to protect the rights of their members.
When unions cannot rely on strikes, pickets, and boycotts, the terms of a labor peace agreement can have a huge impact on the rights of future union members. Advocates for labor may fight for interest arbitration provisions in labor peace agreements. These allow an arbitrator to set the terms of an agreement between labor and management if the two sides fail to reach an agreement within a certain time. While businesses may be averse to these provisions, labor peace agreement laws reduce their range of options.
Potential Litigation Surrounding Labor Peace Agreement Laws
In 1976, the US Supreme Court ruled that states cannot regulate labor-management issues that the federal government chose not to regulate under the National Labor Relations Act. Some areas covered by labor peace agreement laws at the state level may run counter to this decision. The NLRA does not directly address whether employers must grant unions access to workers, among other things, so a state law requiring this access might be challenged in court.
PreemptionSome attorneys and legal scholars have suggested that a challenge to a labor peace agreement law would have a strong chance of success on the basis of "preemption." This doctrine prevents a state from regulating an area that has been thoroughly regulated by the federal government.
Despite this option, most cannabis businesses have not explored legal challenges to labor peace agreement laws so far. A business may be better served by getting a license and starting its operations than by waging a lengthy and expensive court battle. If these laws become stricter or more widespread, though, industry organizations and advocacy groups may consider litigation.
Last reviewed September 2024
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