Cannabis Industry

Grow Operations Coming to Terms With Risk

As the cannabis industry grows and matures, it is becoming savvier about worker safety and risk management.
By: | July 18, 2016 • 5 min read

As the legal cannabis industry matures, its crop producers and retail shops are increasingly adopting risk management practices that include greater attention to worker safety.

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The expanding size and sophistication of grow operations, greater scrutiny from regulatory agencies, crime, potential labor union involvement, and even workforce-retention concerns, are rapidly driving adoption of safety practices ignored when mom-and-pop size operations dominated.

“I see it happening very quickly,” said Justin S. Moriconi, an attorney at Segal McCambridge Singer & Mahoney who advises marijuana industry clients.

“I have seen a huge uptick in standard operating procedures to deal with issues, such as how much weight one [marijuana grow operation] worker can move at one time.”

The shift is driven in part by the industry’s rapid evolution, as more states allow recreational and medicinal marijuana production and sales.

In some East Coast states, for example, there are only a few legal grow operations, but they are very large, requiring millions of dollars in investment. It’s also a business model increasingly driven by players with multi-state operations.

 Justin S. Moriconi, attorney, Segal McCambridge Singer & Mahoney

Justin S. Moriconi, attorney, Segal McCambridge Singer & Mahoney

While such operations don’t typically hire someone with a risk management title, like larger corporations might, they are paying greater attention to insurance purchasing and risk mitigation practices than the smaller operations that dominated the early years of legal cultivation limited to California, Moriconi said.

“When you are dealing with that level of money investment, certainly you are going to be much more attuned to risk management … and making sure everything is going as planned,” he said. “I am seeing a lot of that.”

On the West Coast, Moriconi is witnessing changes as he tours expanding cannabis operations.

A year ago, he toured a grow facility with the walls and floor painted white to boost light reflection that can improve plant yield and thus, the bottom line.

But the paint made for a slippery floor surface for workers tending plants.

“They had done that, not thinking about the production workers walking around this grow operation picking all the dead leaves off, watering the plants, and doing all the things that need to be done to cultivate this product and they were slipping occasionally,” Moriconi said.

During a more recent visit to the same facility Moiconi noticed a slip-resistant floor had been installed, although the slip resistant material remained white.

Jennifer Martin, a cultivation consultant at marijuanapropagation.com, said ergonomics are a key topic she speaks on before industry groups because at many commercial cultivation sites she sees plants on the ground. That forces workers to constantly bend down.

She advises raising the plants on stands to eliminate strained backs while increasing worker productivity.

“Even among younger workers I am seeing knee and back problems from them doing it that way,” Martin said. “So that is the first thing I say when I go in. Not only so the workers won’t be stressed, but so they can do a better job growing the plants because you can see them better when you are looking across [plants] instead of down at them.”

Other risks that grow operation workers face include exposure to chemicals and intense, hot lighting systems.

“Once the unions get involved in this you will have no shortage of claims.” — Justin S. Moriconi, attorney, Segal McCambridge Singer & Mahoney

One emerging workers’ comp risk involves the long hours workers spend hand-trimming leaf matter away from the valuable cannabis buds, several sources said. It is typically a manual job with a potential for repetitive-stress injuries and lacerations.

“I know we have had claims associated with that,” said Jim McMillen, director of safety services at Pinnacol Assurance, a Denver-based insurer of Colorado workers’ comp risks. “Probably the most severe claim we have had with that type operation was an amputation — a finger.”

Unions Stepping In

The spectrum of sophistication among operations means some growers remain primarily focused on the basic task of product production without considering worker safety.

But as more grow operations evolve from bachelor-pad like environments to sophisticated concerns, said Martin, she is seeing greater attention paid to ergonomics and worker comfort.

Risk-mitigation efforts she sees include helping workers with posture, enforcing rest breaks, and hiring masseuses to ease shoulder and wrist strains.

Greater scrutiny from OSHA, state agricultural agencies and state marijuana control boards are helping drive the improvements, Martin said. Like employers in other industries, cannabis operations also adopt safety measures to eliminate employee turnover and retain valuable workers, she added.

Labor union pressures could also drive worker safety improvements. Notably, the 33,000-member United Food and Commercial Workers International Union is recruiting medical marijuana workers under a “Cannabis Workers Rising” program.

Moriconi expects to see the union active in Eastern states, such as Pennsylvania, which are adopting medical marijuana laws and already have an extensive organized labor presence.

In smaller mom-and-pop operations, younger workers may have accepted cash or product as wages and are not likely to report an injury claim, Moriconi said. But that will change.

“Once the unions get involved in this you will have no shortage of claims,” Moriconi said. “They are not going to take product. You will be dealing with different checks and balances to make sure you have the safety and risk management built in.”

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The recent murder of a security guard at a Colorado marijuana shop, meanwhile, added to criticisms that increasing retail outlet security measures often focus on protecting the cash-only businesses’ cannabis product and money rather than workers.

But overall, the risks faced by cannabis retail shops generally mirror those experienced at other retail stores with an elevated exposure profile, sources said.

McMillen at Pinnacol likened the risk level to other businesses interacting with the public and handling cash, like liquor stores or taxi cabs.

The approximately 200 marijuana retail dispensaries insured by California State Compensation Insurance Fund report injuries consistent with other businesses classified as retail operations, a SCIF spokeswoman said.

“It was primarily slips, trips and falls,” she said. “In terms of the injuries, it was strains and sprains.”

Roberto Ceniceros is senior editor at Risk & Insurance® and chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at [email protected] Read more of his columns and features.

More from Risk & Insurance

More from Risk & Insurance

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.

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That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.

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Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]