B.C. red tape frustrates legal cannabis stores’ hiring effort, boost black market

The Cannabis sector is ready to put hundreds of unemployed retail employees back to work – quickly. They’re also well positioned to generate thousands of dollars in tax revenue if they could accept online orders and deliver to your door.

Unfortunately, burdensome regulations mean cannabis retailers are struggling to find workers and being forced to compete with illegal dealers. At the same time, the provincial government is bleeding money in COVID-19 support benefits and is understandably loathed to raise taxes to generate much needed tax revenue.

Since March, the economic fallout from COVID-19 disproportionately hit the retail sector leaving thousands out of work. In early May, B.C. Finance Minister Carole James confirmed almost 400,000 jobs were lost in B.C. in the first two months of the pandemic. Over 264,000 positions were eliminated in April alone, with 47 per cent of those in the food service and retail sectors.

Meanwhile, cannabis retailers have hundreds of jobs to fill.  Sounds like a no-brainer: workers need work, and there are jobs waiting—so what’s the problem? Overly restrictive policies and regulations in the cannabis sector are keeping furloughed employees on government programs; depressing the earnings of B.C.’s regulated cannabis industry; and inadvertently protecting the illicit market.

Inefficient regulations were a problem in B.C. well before COVID-19 shut down businesses. Since legalization, we’ve seen a snail’s pace roll out of retail cannabis outlets— especially in lower mainland municipalities. The Worker Qualification Regulation – the requirement for cannabis employees to undergo extensive security screenings adding time and cost to the hiring process – is a major impediment that is postponing store openings, limiting store hours, and leaving businesses understaffed. An easy solution would be to replace the Worker Qualification Program for retail staff with requirements parallel to the alcohol industry. This would expedite hiring and create a simple solution for workers needing jobs, retailers needing staff, and governments needing money.

As of now, the hiring process for cannabis retail employees takes up to three months to fill one front-counter position. The B.C. Government’s June 18 announcement of the new Selling it Right Program—a self-study course required for retail cannabis workers— has added another layer of cost and complexity to an already burdensome process. In the near term, the B.C. government has made it more difficult (and expensive) to gain employment in the sector. It now costs a worker $135 ($100 worker verification + $35 Selling it Right) to apply to work in a cannabis store, a likely barrier for many unemployed retail workers collecting CERB. The cost of hiring a liquor store or bar employee is only $35 for the Serving it Right Certification (the liquor industry’s equivalent course.)  What would make sense is to have the Selling it Right Program to replace the Worker Qualifications Regulation.

The legal sector is also unfairly banned from online sales and deliveries. Meanwhile, provincial stores sell their products online, and deliver— as do Illicit market dealers who are impossible to regulate and bring in no revenue for the province. Online sales and delivery for private retailers would ensure consumers receive properly labeled, authorized products—and create the best possible circumstances for social distancing. Ontario is estimated to lose $180 million in economic activity when it ends online sales and delivery services from private retailers on July 29. (Ontario retailers were temporarily able to offer additional services—including delivery—due to an emergency order amid the COVID-19 pandemic.)

By pulling back burdensome regulations in these key areas, the BC government could broaden the economic opportunities in the sector, reduce labour market constraints in retail, and focus resources where they’re most needed — vetting cannabis operators, corporate executives, and majority shareholders.

The cannabis sector has the potential to legitimately accelerate recovery as we make our way out of crisis. With reasonable regulations and policies that mirror those of liquor distribution, the sector is poised to provide much needed jobs for workers, create thriving businesses for legitimateemployers across B.C., improve health and safety for consumers, push out the illicit market, and increase tax revenue for a cash-strapped government. The question is if not now, then when?

The BC Chamber of Commerce’s Provincial Cannabis Working Group authored this opinion piece, which was published in the Vancouver Sun on July 24, 2020.

About the BC Chamber’s Provincial Cannabis Working Group

The BC Chamber’s Cannabis Working Group is comprised of some of Canada and British Columbia’s leading cannabis companies, and, organizations from other sectors, which have the collective goal of fostering a strong, competitive economic environment for the cannabis sector.

The group is led by Kiaro, Pure Sunfarms, Loblaws, and Deloitte, and aims to make cannabis an economic driver in B.C. while increasing consumer health and safety and displacing the illegal legacy market.