Employee Background Checks for Dispensary Hiring: Owner’s Guide

August 21, 2023

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1. Introduction

The cannabis industry is a rapidly growing industry in the United States. As of May 2023, there are 37 states and the District of Columbia that have legalized cannabis for medical or recreational use to varying degrees. This growth has led to a demand for qualified employees in the cannabis industry.

One of the most important steps in the hiring process for cannabis dispensaries is conducting background checks on potential employees. Background checks can help to ensure that dispensaries are hiring trustworthy and reliable employees who are not likely to engage in criminal activity.

2. Unique Considerations in the Cannabis Industry

The cannabis industry has some unique considerations when it comes to conducting background checks. These considerations include:

The evolving legal status of cannabis: Cannabis is still illegal under federal law, even though it is legal in many states. This means that there is some uncertainty about the legal implications of conducting background checks on cannabis industry employees.
The need to maintain compliance in a sensitive market: The cannabis industry is a sensitive market, and dispensaries need to be careful not to violate any laws or regulations. This includes being careful about the information that is obtained during background checks.
The cost of background checks: Background checks can be expensive, especially for small businesses. This can be a barrier for some dispensaries, especially those that are just starting out.

3. Types of Background Checks

There are a variety of background checks that can be conducted on potential employees in the cannabis industry, including:

Criminal background checks: Criminal background checks can help to identify potential employees who have a history of criminal activity, such as theft, fraud, or violence.
Credit checks: Credit checks can help to identify potential employees who have financial problems, such as unpaid debts or bankruptcies.
Drug tests: Drug tests can help to identify potential employees who use illegal drugs.

The specific types of background checks that are conducted will vary depending on the position and the state in which the dispensary is located. For example, dispensaries that are located in states with stricter regulations may require more extensive background checks than dispensaries that are located in states with less strict regulations.

4. Laws and Regulations

The laws and regulations governing background checks in the cannabis industry vary from state to state. Dispensaries should be familiar with the laws and regulations in their state before conducting background checks on potential employees.

In general, background checks are permissible in the cannabis industry. However, there are some restrictions on the types of background checks that can be conducted and the information that can be obtained. For example, some states prohibit background checks that include information about a person’s medical history or their use of cannabis.

Requirements for cannabis business owners and employees

Also as with other cannabis regulations, regarding the background check policy, it can be significantly stricter for a leader at the helm of a marijuana business than for an employee. Some states, for example, have rules that bar individuals with certain criminal convictions from getting a state license to open a cannabis business. At the same time, a person with the same conviction would often be allowed to go to work for an existing cannabis business without jeopardizing that company’s licensing.

5. Do all dispensaries need to run background checks on budtenders?

The answer to this question is not always clear-cut. In some states, all dispensaries are required to run background checks on all employees, including budtenders. In other states, dispensaries are only required to run background checks on budtenders if they are handling cash or if they have access to the dispensary’s inventory.

Ultimately, the decision of whether or not to run a background check on a budtender is up to the individual dispensary. However, it is important to note that running a background check can help to protect the dispensary and its customers from potential risks, such as employee theft, fraud, and drug dealing.

6. Benefits of Background Checks

Background checks can offer a number of benefits for cannabis dispensaries, including:

Protection from employee theft: Background checks can help to identify potential employees who are more likely to steal from the dispensary.
Protection from fraud: Background checks can help to identify potential employees who are more likely to commit fraud, such as embezzlement or financial statement fraud.
Protection from drug dealing: Background checks can help to identify potential employees who are more likely to deal drugs from the dispensary.
Protection from workplace violence: Background checks can help to identify potential employees who are more likely to commit workplace violence.

7. Risks of Not Conducting Background Checks

Dispensaries that do not conduct background checks on potential employees are taking on a significant risk. Without background checks, dispensaries may hire employees who have a criminal history, financial problems, or drug use problems. These employees could pose a risk to the dispensary and its customers.

For example, an employee with a criminal history could steal from the dispensary or commit fraud. An employee with financial problems could embezzle money from the dispensary or commit other financial crimes. An employee with drug use problems could be impaired on the job and pose a safety risk to themselves and others.

8. The future of background screening requirements

The future of background screening requirements in the cannabis dispensary space is likely to be shaped by a number of factors, including:

The continued legalization of cannabis: As more states legalize cannabis, the demand for background checks on dispensary employees is likely to increase. This is because businesses will want to ensure that they are hiring qualified and trustworthy employees who are not a risk to their customers or their business.
The development of new technologies: New technologies are being developed that can make background screening more efficient and effective. For example, there are now companies that offer blockchain-based background checks that are more secure and tamper-proof than traditional background checks.
The changing attitudes towards cannabis: As attitudes towards cannabis continue to change, the stigma associated with cannabis use is likely to decline. This could lead to more businesses being willing to hire people with a history of cannabis use, which could reduce the need for background checks for cannabis-related offenses.

Overall, the future of background screening requirements in the cannabis dispensary space is likely to be a dynamic one. The specific requirements will vary from state to state, but it is clear that background screening will continue to be an important part of the hiring process for dispensaries.

Here are some additional trends that could impact the future of background screening requirements in the cannabis dispensary space:

The increasing use of artificial intelligence (AI) in background screening: AI is being used to automate many aspects of the background screening process, from data collection to risk assessment. This could lead to more efficient and cost-effective background screening for dispensaries.
The growing demand for customized background screening: Dispensaries may want to customize their background screening requirements to meet the specific needs of their business. For example, a dispensary that sells medical marijuana may want to conduct more stringent background checks on employees who will be handling the product.
The increasing importance of social media screening: Social media screening is becoming an increasingly important part of the background screening process. Dispensaries may want to review the social media profiles of potential employees to look for red flags, such as evidence of drug use or violent behavior.

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Conclusion

By conducting background checks, cannabis dispensaries can help to protect themselves from risk and ensure that they are hiring the best possible employees. Background checks are an important part of the hiring process for any business, but they are especially important for businesses in the cannabis industry.

If you are a cannabis dispensary owner or manager, we encourage you to learn more about the laws and regulations governing background checks in your state. You should also work with a reputable background check company to conduct background checks on potential employees. By doing so, you can help to protect your business and your customers.

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