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In my human resources (HR) consultant role, I meet with dispensary owners and managers to discuss their businesses and what HR issues might be keeping them up at night.

I find mid-sized dispensaries typically have a dedicated HR representative whose job it is to stay current on regulatory and compliance matters, handle payroll and perform administrative tasks that the owner or manager doesn’t have the time or the expertise to do themselves.

At small dispensaries (less than six employees), usually the owner or manager is either trying to do all the HR work or has outsourced the basic tax, payroll, workman’s comp and insurance functions.

No matter the dispensary size, owners and/or managers generally feel they have basic HR under control and are hesitant to make changes because they do not realize that a strategic HR function can improve operations and their dispensary’s bottom line. That brings us to the No. 1 question I receive.

1. Why do I need an HR person, and what are the benefits to me and my business?

This is a fair question, especially since many dispensary owners/managers don’t fully understand the role and functions an HR representative performs. So, let’s start there. HR is needed to provide these critical functions:

  • Understand and stay current on all state and federal employment laws and regulations.
  • Develop and ensure all staffing decisions are within state and federal laws.
  • Be an employee advocate and ensure there is no bias when employee performance issues must be resolved.
  • Provide new employee on-boarding training.
  • Conduct recruiting through social media and other avenues.
  • Create an engaged workforce to retain high-performing employees.
  • Train dispensary management. (Most employees leave companies because of unhappiness with their managers).
  • Ensure payroll, tax and insurance processes are appropriate and in accordance with state and federal regulations.
  • Conduct interviews and provide hiring recommendations.
  • Lead employee surveys to obtain employee feedback and communicate feedback to management to improve the workplace.
  • Help manage operating expenses such as turnover, employee training and benefits.
  • Provide strategy and methods to increase productivity.
  • Provide strategic workforce planning insights aligned with the dispensary’s mission and business goals.

After hearing this list, most dispensary owners/managers conclude that they cannot handle these critical tasks—even if they have some HR training—in addition to their other daily responsibilities. Therefore, having a dedicated HR representative makes sense. Further, if the dispensary is outsourcing some of the basic tasks, there is usually no attention paid to how the HR function can be a strategic advantage to the dispensary—another reason to hire an HR professional.

2. I have an employee who started out fine, but his/her performance is now suffering. What can I do?

I answer this question with a few questions of my own:

  • Has the employee had a recent change in his/her personal status? Life events such as getting married or divorced, having a sick child or caring for an elderly parent can impact work performance.
  • Has the employee’s job changed or have there been changes in the organization that impact this employee’s role? Changes to staff hierarchy, work hours, responsibilities or management policies can impact work performance.
  • Was a performance review or an employee assessment conducted? Structured employee reviews can give managers consistent and objective information about the dispensary employees, rather than having to rely on instincts, impressions or gossip.
  • Have you identified the performance deficiencies and discussed these with the employee and/or have you given previous performance guidance?
  • Are you committed to helping the employee succeed, or are you no longer able to manage the employee or interested in developing this employee?

Depending on the responses to these questions, I may suggest that a Performance Improvement Plan (PIP) be initiated with this employee.

A PIP, in short, is a written document describing acceptable performance levels and behaviors, how the employee’s current performance is deficient or not meeting those acceptable levels, and what the employee needs to do to improve. Usually, the job description and relevant employer policies are attached as well. (See the sidebar above.)

A conversation is held with the employee and feedback is encouraged to clear up any areas of confusion and to incorporate his or her input on how to make the PIP most effective. The manager should show commitment to the plan by scheduling follow-up discussions to monitor the employee’s successful progress.

The employee needs to be committed to improving his or her performance and follow the steps outlined in the PIP within the set timeline. Usually, the outcomes are very positive for both the dispensary owner and the employee when the PIP process is used.

Sometimes, however, the employee will disregard the PIP and the situation worsens. That’s when consequences need to be considered, which leads to a much different and more complicated topic and to the third question I am asked most often.

3. I have an employee who is not working out. How can I properly and legally terminate our relationship?

Firing an employee is often viewed by dispensary owners/managers as one of their most challenging, unpleasant and emotional tasks. Many legalities and steps are involved in the termination process. Usually, a progressive discipline strategy is recommended, which must be followed by the owner/manager to avoid a wrongful termination lawsuit. The dispensary owner/operator or your HR generalist should know the relevant employment termination laws for your region. (The U.S. Department of Labor’s website has a list of all state labor offices with contact information: bit.ly/StateLaborOffices.)

A decision to terminate an employee should always be based on objective facts about the responsibilities and tasks of the job and the employee’s demonstrated performance, never about his or her personal, religious, sexual or cultural differences.

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Additionally, there are operational impacts that must be considered when terminating an employee. Before any action is taken, I ask the owner/operator:

What is this going to cost you? Significant costs to consider include:

  • Search, recruiting, interviewing and hiring costs
  • Replacement costs (i.e., training and on-boarding)
  • Cost of inefficiencies as the new hire learns the job

Other cost considerations include:

  • Lowered productivity from overworked staff in the interim
  • Lost workforce knowledge and experience

Have you done everything you can with this employee? Before terminating this employee, have you:

  • Had a conversation and asked whether the employee is aware there is a problem, and what he or she thinks should be done about it?
  • Reinforced your dispensary’s values and goals and had discussions with all employees about how they represent these values and how they contribute toward the goals?
  • Provided opportunities for employees to get to know one another?
  • Conducted training and provided the resources the employee needs to successfully perform his or her job?

If the answer is “yes” to these questions, there are specific steps to follow to properly and legally terminate the employee. (Here is a website that can be helpful to any dispensary owner/manager who needs immediate resources: bit.ly/EmployeeTerminationSteps.)

Based on my experiences and conversations, these questions and topics represent serious concerns for dispensary owners/operators and have caused plenty of sleepless nights. HR issues can be very challenging for dispensary owners and managers, so when in doubt, contact an HR professional for guidance.