New York’s governor and Legislature last week reached a deal to end the state’s cannabis industry labor peace agreement requirements, while also ending plans for an industry wage board.
In an October 28 memorandum on S.10643 – which repealed the labor peace agreements section of the adult-use cannabis law but created a wage board for the industry within the state Department of Labor – Gov. Kathy Hochul (D) said that while a recently-passed amendment to the state’s adult-use cannabis law “helps guarantee that licensees and employees continue to work together in a mutually beneficial manner, without imposing burdensome requirements on the other…the bill as passed would create uncertainty in the industry by imposing a burdensome reporting requirement on applicants” and that the creation of a wage board could raise costs for businesses “and drive consumers to the illicit market.”
“This further amendment would preserve the repeal of the labor peace agreement requirement in full, while removing the wage board component of the bill. Additionally, it would give the Cannabis Control Board the discretion to prioritize adult-use license application, submission, review, selection, and issuance based on an applicant’s voluntary entry into a labor peace agreement.” — Hochul in the memorandum
Hochul signed the bill into law after reaching a compromise with lawmakers.
In a statement, Safe Affordable Cannabis for New York, a state cannabis industry association, said that according to a recent FTI Consulting survey, New York cannabis industry workers ” earn about 19% more than comparable occupations statewide, including 25% more in the retail sector.”
“A special interest driven wage board would have imposed additional costs on small businesses already facing massive federal tax rates as high as 70% while competing with the illicit market, driving up consumer prices and threatening thousands of jobs across the state,” the statement said. “Governor Hochul recognized that risk and made the right decision to protect small businesses, workers, and consumers who depend on a safe and competitive legal cannabis market.”
In a joint statement, the Empire Cannabis Manufacturers Alliance, Association of New York Cannabis Processors, and the Cannabis Farmers Alliance said Hochul “made the right call for New York’s legal cannabis industry, consumers, and workforce by stopping a wage board that would have driven up prices and imperiled the legal market her administration has spent years establishing.”
“Her decision safeguards the farmers who grow cannabis, the processors and manufacturers who turn it into safe, regulated products, and the workers whose livelihoods depend on this growing industry,” the statement said.
The groups added that “additional labor costs mandated by a wage board would have compounded at every stage of the supply chain, from cultivation and processing to manufacturing and retail, ultimately raising prices for consumers and making it harder to compete with the illicit market.”
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