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Blüm is one of Oakland's eight licensed medical marijuana dispensaries. Of the eight, Magnolia Wellness is the only one that is unionized.

Will unionizing the cannabis industry bud in Oakland?

on November 10, 2015

They are growers, pruners and greenhouse workers. They are drivers, delivery servicemen, packagers and warehousemen. They make teas, baked goods, butters and candy. They make extracts and tinctures. They are processors, scientists and they work at storefronts. They all make their living working with the same key ingredient: marijuana. And some of them are even members of a union.

Since 2010, the Bay Area’s cannabis industry has been unionizing, in almost every case by the United Food and Commercial Workers, or UFCW. This is the same union that represents grocery store workers at Safeway, Lucky’s and SaveMart, as well as Peerless Coffee employees and Rite Aid clerks and pharmacists. If a product is consumable, there is a chance that a UFCW worker is involved at some point before it reaches its customer.

But the union’s task in the marijuana industry is extremely difficult. Grocery work is carried out in a completely legal setting and stores sell goods that are not only legal, but carefully monitored by the Food and Drug Administration and the United States Department of Agriculture. The cannabis industry, on the other hand, is not as straightforward. Marijuana is illegal under federal law. The Drug Enforcement Agency has a long history of raiding growers and dispensary operators alike, rappelling from helicopters onto pot farms and warehouse roofs, making arrests and confiscating every marijuana plant in sight.

But in some states the marijuana industry is legal under state law, like Washington, Oregon and Colorado. California allows some consumption of cannabis, as long as it complies with laws that regulate it as medicine, although recreational use is still banned. Within California, cities are allowed to regulate the medical marijuana industry, because dispensaries require licenses to operate legally, and only city and town governments can award them.

Disagreements between city, state and federal law in California and other states with similar medical marijuana provisions has put the industry in a legal twilight zone. In California, growing, processing and selling marijuana as a medical cooperative is both completely legal and illegal. This is the murky environment in which unions have been trying to gather workers into unified teams that can negotiate with their managers. These unions try to reach through the legal pall to ensure that workers are paid adequate wages, receive healthcare provisions, retirement benefits, proper training and ensure product safety.

But thanks to the rate at which the industry is growing, through new dispensary licenses that cities are awarding to medical marijuana distributors, to the boom in marijuana processing, some union leaders think worker organization is inevitable. “It’s a tsunami,” said Jeff Ferro, the leader of the “Cannabis Workers Rising” campaign for UFCW. “This campaign for cannabis workers—we spend a lot of money on it.”

Today, about 250 cannabis workers in the Bay Area belong to UFCW, which represents 12 to 15 workplaces, according to an estimate from Ferro and Jim Araby, the union’s Western State’s Council executive director. There are eight dispensaries operating in Oakland: Oakland Community Partners, Blüm Oakland, Oakland Organics, Purple Heart Patient Center, Telegraph Health Center, Harborside Health Center, Phytologie Oakland and Magnolia Wellness. Only one, Magnolia Wellness, is unionized under UFCW. Right now, the beginning steps to full-fledged union status, known as neutrality agreements, are being negotiated at dispensaries in Vallejo, Berkeley and San Leandro, according to Ferro.

Ferro said that cannabis workers in the medical dispensary system need diligent health and economic protections, and that workers need the right to negotiate as a group, because there is no industry that is immune to worker abuse. “The employers are just like any other industry. Some of them are going to try to cut corners—whether it’s to not pay well or not provide healthcare, they’re going to try to do it,” he said.

Debby Goldsberry works at Magnolia Wellness in Oakland, and she is a union member. She said that after she lost her job at another dispensary, UFCW helped her find a new job as a contract employee. Not only did she find new employment, but she also received one of its most sought-after provisions: healthcare. “I’m extremely thankful, right off the bat, that my daughter and I have healthcare. That was the very first benefit that the union brought to me,” she said.

Goldsberry also spoke about the risks of an industry where robust worker contracts are rarely signed, and at-will employees can face termination at any moment. “I hope other workers realize the benefit and realize the difference between an at-will employee and to be a contracted employee. You can count on feeding your family and paying your rent, and being able to buy school clothes for your kids,” she said.

Not all cannabis workers are enthusiastic about unions, though. Dale Sky Jones, the executive chancellor at Oaksterdam University, a marijuana trade school situated in the canyon-like corridors of buildings in downtown Oakland, recalls that some workers had doubts before theirs became the first dispensary to unionize back in 2010. That was was a big election year for cannabis. Proposition 19, otherwise known as the “Regulate, Control & Tax Cannabis Act,” sought to legalize marijuana in California for those over 21 years old, as well as make it easier to retail, transport and tax. Richard Lee, Oaksterdam’s founder, was the lead proponent of the initiative, which was defeated with a 53.5 percent “no” vote.

Sky Jones remembers the Sunday following the election. Some of the Oaksterdam faculty were at the campaign headquarters when “a big bald-headed dude on a motorcycle pulled up. He said he had lived in Oakland all his life and came from three generations of Oakland,” Sky Jones said. He said he had watched the city decline ever since the Loma Prieta earthquake, which had badly damaged many buildings. It had “become that place you tell your mother and daughter not to go at night,” Sky Jones said of the state of downtown. But the man said he had watched Oaksterdam and its dispensaries pump a new economic life force into downtown as storefronts filled up, Sky Jones recalled. The man with the bare cranium was impressed, she recalled, and said his name was Dan Rush and that he represented the UFCW.

Rush proposed that Oaksterdam unionize, because UFCW organizes many agricultural workers and retailers. Sky Jones and the faculty thought that this was a good idea, particularly from a political standpoint, she recalled. She said she sensed that Oaksterdam was chosen for a union drive because they represented the vanguard of “a new burgeoning industry in need of the same worker protections that are needed in any other industry.” She, on the other hand, saw the union as “a way to bring the industry out of the shadows, and into the light. So that you weren’t saying the word ‘budtender’ with a giggle and snark, but with your shoulders back and your head held high”.

But when the school branch of Oaksterdam, lead by Sky Jones, broached unionization with the workers that worked in the dispensary branch, they balked. “We pulled our 50-plus employees into our theater at the school and we had one of the international vice presidents of the union come in and talk us,” Sky Jones remembered. Sky Jones summarized the workers’ response thusly: “We don’t need no stinking union. Richard [Lee] takes good care of us. Why the hell would we bring unions into one of the best jobs we’ve ever had?” Dispensary workers at Oaksterdam had their own concerns, as Sky Jones recalls it. “They’re on the front lines,” she said. Should Oaksterdam be robbed or raided, the workers would bear the brunt of the crisis. From the workers’ perspective, unions just complicated the picture.

Eventually though, two different union contracts would be signed to address the dispensary workers’ concerns. “We had more protections with the unions, not less,” Sky Jones said.

Ferro said workers also face other risks at work that unions can protect them from, such as health and safety problems. “We’re trying to bring safety standards to this industry. They’re not following Occupational Safety and Health Administration guidelines for manufacturing. Some try to. Some use the excuse that it’s cannabis so they don’t really have rules,” said Ferro.

Often, according to Ferro, workers can suffer in silence if workplace safety problems go unreported. He said workers are afraid of tangling with law enforcement or having their workplace arbitrarily shut down if they file a report or clash with management. “That’s the problem with this industry for a lot of these workers. If they call an agency, they could come and shut them down and then they lose their job altogether, let alone a couple hours of pay,” Ferro said. “The difference between this industry and others is that workers in other industries clearly know they have the right to a bunch of governmental agencies that they can access. In this industry workers are distrusting of those same governmental agencies. And rightly so.”

In 2013, Maine’s Department of Health and Human Services (DHHS) investigated that state’s largest dispensary, Wellness Connection of Maine, because of tip-offs that they had been using pesticides on their marijuana plants. According to The Portland Press Herald, the DHHS received 22 calls from employees concerned about the pesticide use.

According to Ferro, a fungus had broken out in one of the dispensary’s growing operations. The plants were close to harvest time, and the employer was unwilling to sacrifice the crop, so they required employees to apply a fungicide to the plants. The employees had no idea how to apply the chemicals, or what to wear to protect themselves, Ferro said. According to Ferro, not only were workers concerned about their own safety, they argued that the patients that bought the medicinal marijuana sometimes had compromised immune systems or other ailments. Ferro says that after the workers were forced to apply the pesticides to the crop, the workers started getting sick and patients came in complaining about illness. The state’s DHHS ultimately released a notice stating that the dispensary had violated state medical marijuana laws by using several pesticides.

(Maine Wellness Connection’s founder and director Becky detester declined a request for interview.)

Additionally, The Bangor Daily News reported, the workers performed a walkout that February to protest being told to apply pesticides to the cannabis plants. Many of these workers contacted UFCW looking for help. They were not unionized at the time, but they gathered with the help of UFCW to stage protests. After the walkout, some employees alleged that their employer had retaliated by interrogating them and discouraging union organization, reported The Portland Press Herald.

The union filed a case with the National Labor Relations Board, a federal agency that adjudicates labor disputes, seeking clarification on whether unions could organize within the cannabis industry. The case proceeded all the way to the General Counsel in the early spring of 2014, where the counsel asserted the union’s right to organize the workers. Not only that, but the federal labor authority asserted its jurisdiction to regulate labor disputes within the cannabis industry, should future conflicts arise. In wake of the conflict, the dispensary’s upper management declared that if a majority of the workers wanted to unionize, they could, according to The Bangor Daily News. “It legitimized UFCW’s work in marijuana labor organization. That was a game-changer for us,” Ferro said.

Ultimately, the dispensary was fined $18,000 by DHHS and $14,000 by the Occupational Safety and Health Organization, according to a UFCW press release. The dispensary has since stopped using pesticides, according to a September, 2015, article in The Portland Press Herald, describing the dispensary’s efforts to recall two strains that were tainted with microbial growth.

Labor organizers say that unions do more than protect their workers—they protect consumers. Regulation at each stage of the cannabis industry is uneven, so “union-made” branding has recently become an important mark of trust between the patients and producers, said Ferro. In Oregon and Washington, a couple of products made by union members come with a UFCW stamp printed on them. “If it’s flower material in a baggie, it might have a label that says, ‘THC content,’ ‘CBD content,’ ‘THCV content,’” said Ferro, referring to the active components of marijuana. THC causes a high, while CBD does not. The National Cancer Institute suggests that both THC and CBD can be used as an analgesic, appetite stimulator and anti-nausea treatment, among other uses.

“Then it might have the name of it, the strain, and ‘UFCW-grown’ on it or something like that,” Ferro continued. “I would imagine that people knowing that the product was produced by a trained workforce, and not some guy that grabbed it off the street, it might make people more comfortable ingesting, inhaling or spreading something on their body.”

But after an initial flurry of union activity, unionization has hit a slump. Dan Rush, who had spearheaded the 2010 effort to unionize Oaksterdam, was indicted on felony charges on August 17, 2015. The charges include taking $600,000 in loan forgiveness from two dispensary operators, as well as kickbacks from an attorney that he connected with dispensary operators and operators seeking licenses. Rush plead not guilty at his arraignment in September.

More importantly, the UFCW Local 5 that has jurisdiction in Oakland and most of the Bay Area has undergone a crucial change in leadership. On July 1, the local elected a new president. Since then, Ferro said, the union has steered away from aggressively organizing cannabis workplaces in order to concentrate on their current union members. This is because Safeway and Albertson’s have merged, and now California locations are being purchased by the grocery chain Haggen. Haggen is based out of the Pacific Northwest and has a strong UFCW membership, so the union is aiming to ensure that all of the new workers are welcomed into the fold, according to press releases on the Local 5 website. The merge-and-purchase shake-up has shifted most of UFCW Local 5’s resources away from cannabis, according to Ferro.

Thanks to the difficulties of unionizing the cannabis industry, other unions are still measuring how willing they are to dive into the legal twilight zone surrounding marijuana. Many are looking ahead to the November 2016 elections for a final legal sort-out at the state ballot box. There are currently six petitions for measures in circulation in California that would legalize cannabis for recreational use and one to make amendments to the current medical cannabis model. All of these measures require at least 365,880 signatures to make the state ballot next November.

California’s Proposition 215, in 1996, paved the way by legalizing the medical use of marijuana in the state. The legislature cemented marijuana’s quasi-legal industry status by passing Senate Bill 420 in 2003. SB 420 created the patient groups, identification cards and cooperative growing systems that form the lynchpin of the marijuana industry in California today. Cannabis sales are strictly limited to medicinal use. In 2009, Oakland became the first city to tax cannabis. But under federal law, cannabis use remains illegal for any purpose.

Federal raids on the cannabis industry are a constant risk, and union membership is no deterrence. Even Oaksterdam University, which sits in the downtown of California’s most marijuana-friendly city and has an UFCW-unionized workplace, could not escape a raid in April, 2012 conducted by Drug Enforcement Agency and Internal Revenue Service agents. “They came in the early morning. They had maybe 100 agents spread across six locations,” Sky Jones said, including the dispensary and founder Richard Lee’s apartment. At Oaksterdam, four workers were tending to the nursery downstairs when federal agents entered the indoor garden. The agents took the nursery workers to another room, Sky Jones said, where they would remain for four to six hours.

While the workers sat waiting, agents marched in and out of the building, carrying unidentified objects in dark black garbage bags. Certainly some were filled with plant material, Sky Jones supposed, because the nursery’s crop had vanished. A small crowd of bystanders gathered around the entrance to Oaksterdam. “My phone lit up,” Sky Jones said. She and her husband rushed to the action and arrived at 8 o’clock.

By 10 o’clock, the crowd had swelled to several hundred people. Rebecca Kaplan, city council member-at-large, arrived, and the growing number of reporters spotted her standing side-by-side with Sky Jones, which, “triggered an impromptu press conference,” she said. A police line had formed between the federal agents and the general public. Some of protesters were yelling with bullhorns and screaming, “Shame! Shame! Shame!” said Sky Jones.

For Sky Jones and Oaksterdam, it was a brutal reminder that federal law trumps state law. Contrary to the assumption of many, Sky Jones said she believes the federal agents were not conducting the raid on behalf of the Drug Enforcement Administration, but on behalf of the Internal Revenue Service who were looking for evidence that Lee was evading his taxes. Representatives from the DEA confirmed for Oakland North that they cooperated with the IRS during the raid.“That was a collaborative investigation with the IRS,” said Special Agent Casey Rettig of the DEA. But representatives from both agencies said that the affidavit for the raid has not been made public, and that they were not able to comment. Similarly, a representative from the US Department of Justice was not able to find any publicly-released documents. Charges were never filed against Oaksterdam, Sky Jones said. Lee no longer owns Oaksterdam; he transferred the dispensary and school to others.

For the Teamsters, a massive union famous for organizing truck drivers, their Local 70 in Oakland has hesitated to organize cannabis workers with the same fervor UFCW has. Four years ago, recalls Lou Marchetti, a representative from Local 70, he was interviewed on television about their recent unionization of a marijuana growing operation in Oakland. “Once I did this, I was getting calls from Colorado, Illinois, everywhere—you know that these people wanted to get unionized or they wanted to join together with the Teamsters,” Marchetti said.

But one day, Marchetti said, when he picked up the phone, the caller was one of the owners. “Hey man, we just got a notice they froze our bank accounts. We’re clearing everything out, and we’re done,” Marchetti remembered him saying. Marchetti feels that it is possible that the media exposure regarding their unionization may have put the company on the federal government’s radar. Dominic Chiavare, president of the Teamsters’ Local 70 in Oakland, remembered that day in 2011 as well. “They scooped him up and he was gone, that was the end of that company.”

But Arlette Lee, a spokesperson for the IRS, could not locate any public records confirming that a bank account relating to the company that Marchetti describes was frozen by her agency. “If it does exist, a lot of times they are under seal,” Lee said. Charges under seal are not released to the public record. Regitt, of the DEA, could not find any record of such a freeze either.

Regardless, Marchetti said that after 2011, “the international union got cold feet,” referring to the Teamsters’ top decision makers and strategists. And since then, the Teamsters have been waiting. “Obviously we’re not interested in anything illegal. At the state level, if people voted for it [to be legal] in California like it is in other states, it would change the whole thing, the whole dynamic,” Chiavare said.

Jim Araby, the executive director of the UFCW Western States Council and their key political representative, discussed his union’s ambitions for cannabis next November while his car hummed in the background of yet another drive to Sacramento. Araby worked on a policy taskforce with Lieutenant Governor Gavin Newsom that sought to chart a way towards a well-regulated legalization of marijuana. And as the industry matures, Araby said, large-scale industrial production will replace the average small business dispensary storefront. This will require a bigger union with more power, in order to fairly represent the workers.

Araby thinks that other unions will be attracted to dispensary workers in the future. “We would hope if other unions are interested in organizing that they would partner with us and we could figure out a strategy together, and we don’t fight over turf or territory,” he said. But, he said, “At the end of the day, workers are smart enough to ask, ‘What’s the organization that can best represent me?’ I would hope that that would be UFCW, we’ve been in this the longest and understand this industry the most out of all the other unions.”

Marchetti, from the Teamsters, said that unions have a way of working together. The alcohol industry is an example of this, he said. When the constitutional prohibition against liquor was ended in 1933, a three-tier system was written into the new law. Producers, distributors, and retailers must remain separate—and unions have separately organized these parts of the industry. From the Teamsters’ point of view, they would be most qualified to organize distribution in the marijuana industry, if it becomes legalized and regulated in the same manner alcohol is. “If it gets legalized it will be like the liquor industry, because in the liquor industry we handle distribution. We’ve organized the Southern Wine and Spirits and the Young’s Markets of the world,” Marchetti said.

Sky Jones emphasizes that union support would be crucial to getting any of the measures passed. “The unions would need to have union-friendly language in any initiative,” Sky Jones said. She also emphasized that any successful initiative will have to underscore its societal good, to justify the potential tax windfall that could flood the state’s coffers if recreational marijuana becomes legalized and regulated. “We want to make damn sure that money goes to education with a priority to disadvantaged communities,” Sky Jones said.

Araby said that with seven measures potentially on the ballot in 2016, there are seven options for supporters to get behind. In his view, this could spread the support too thinly, so none succeed. Coordinated support among unions will be important, especially just to fulfill the signature requirements before any can be placed on the ballot. “I hope all the different parties and interest groups that want there to be a legalization measure can get together behind one initiative, that we don’t try to leverage each other. That’s my fear. If we play this game of chicken, and nothing passes, that would set back the momentum that’s been building across the country,” he said.

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