Ensuring compliance with health and safety laws
Did you know that even though the Federal government does not yet recognize the legality of cannabis, the Occupational Safety and Health Administration (OSHA) has the jurisdiction to inspect cannabis agricultural, processing, and retail worksites and cite owners and companies for workplace violations?
It is important to note that even though you may have submitted a health and safety plan as a part of your state application for a cannabis license, and/or attended certain required training programs, these do not fulfill your obligations under federal or state OSHA laws. The type of business you operate within the cannabis industry will determine the legal obligations. Requirements for dispensaries are much different than for grow operations, and if you have an extraction operation, then there are even more laws that must be followed.
Under the OSHA law, employers have a responsibility to provide a safe workplace that is free from serious, recognized hazards, and to comply with standards, rules, and regulations issued under the OSH Act of 1970. Cannabis businesses come with both unique industry as well as typical workplace-hazards and risks that must be managed. These range from security and workplace violence, to fire and explosion hazards associated with the use of chemicals and gases, to ergonomic hazards from processing and packaging of product. Further, cannabis businesses, like all workplaces, have “common” hazards and risks that must be managed, including slips, trips, and falls, electrical, confined spaces, lock out / tag out, and emergency response.
Since California became the first state to legalize medical cannabis in 1996 with Proposition 215, cannabis industry-related businesses have lost millions of dollars due to OSHA violations. Some of the most common violations have been associated with inadequate or lack of the following:
OSHA violations can be expensive, financially and otherwise, and may include criminal charges and fines; disruption of business; hits to a company’s name or brand; revenue loss; and production time loss. A safe work environment provides the opportunity to avoid such costs, violations, and other serious liability risks that could negatively impact a business or reputation. A professional safety and health program can lower insurance premiums; add value to your business through a happier, healthier, and sustainable workforce; and can present your business as desirable to future employees and investors.
Like what you read? Watch this newsletter for monthly posts in which I will bring together the unique perspective and experience of lawyers, insurers, owners/operators, and industry leaders discussing current concerns and issues surrounding licensing, opening, operating, and sustaining a healthy and safe cannabis business.
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Jason Lang of RHP Risk Management is a board-certified industrial hygienist (CIH) and certified safety professional (CSP) based in Chicago. He regularly works with local and national clients in the cannabis industry. jlang@rhprisk.com
CLM’s Cyber, Management & Professional Liability Community helps raise awareness of issues and trends in the management & professional liability insurance marketplace, with an emphasis on litigation management through a collaborative effort between insurance companies and brokerages, claims organizations and service providers.
