BC court rules cannabis producer violated labour code by firing employees seeking to unionize

| David Brown

A BC court has ruled a cannabis company has violated the Labour Relations Code by laying off several employees who were seeking to unionize at a facility in Peachland, BC.

The court ordered that the laid off employees be reinstated to their employment and their layoffs rescinded. 

The company, Potantical Green Growers, is a wholly owned subsidiary of a publicly traded company, known as Benchmark Botanics Inc. The United Food and Commercial Workers International Union Local 1518 brought the case forward, arguing that Benchmark had violated several labour codes by laying off a handful of employees that were seeking to unionize. 

In addition to owning the Potanticals Peachland facility, Benchmark recently acquired a cannabis producer based in Pitt Meadows, BC. They also hold a cultivation license which is being utilized in a joint venture with YATABI & BBT Biotech Ltd., involving an indoor and outdoor operation, also located in Pitt Meadows.

In September of this year, the Union, Local 1518, began organizing and soon applied to be certified for 17 employees at the Peachland operation. Then, on October 5 of this year, the company laid off nine employees at the same Peachland operation, citing “the Company’s financial circumstances”.  The union argued these employees were laid off for seeking to unionize. The court agreed.

Those laid off included key personnel required to operate the facility in compliance with Health Canada regulations like the Master Grower and the Head of Security. In addition, on September 30, the company’s QAP quit, another key role for a licence holder to maintain. 

The Peachland company told the former employees the layoffs were due to financial circumstances exacerbated by the pandemic, and that if the company could secure more investment, they would recall the laid off employees. 

However, the court noted that although Benchmark’s financials showed significant operating losses, it did have a “sizable” amount of cash on its books, generating over $2M in cash from financing activities in the first six months of 2020.

In addition, the court noted that laying off required personnel like the Master Grower and Head of Security made little sense from a financial standpoint, since these would be positions they would have to quickly re-fill in order to be compliant with federal regulations. 

It also noted that Benchmark’s claims that it intended to hire back employees based on the future sale of product in their storage was unlikely given that the product in storage was largely unsalable.

“The Employer’s inventory is kept in a vault in Peachland.  There is approximately 280 kg of inventory in the vault.  Much of the inventory had been in the vault for several years.  Some of it was rejected by Health Canada for sale or is otherwise not marketable for a variety of reasons, including low THC and CBD content.  The Employer had attempted to sell the product in the past without success.  Bigattini valued the inventory as being worth pennies per gram for the most part, with only a small amount of premium craft cannabis included.  Moreover, even if the inventory was sellable, there was very little craft”.

In addition to the nine employees’ jobs being reinstated, the court ruled the Union be allowed to install a bulletin board in both the Peachland location for 90 days and that this decision be circulated to the employees. The employer is also required to have provided all of its employees a copy of the court decision no later than Monday, October 19 at 9:00 a.m.

Featured image via Benchmarkbotanics