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What Is a Cannabis PEO (And Why Your Business Needs One)


  • Cannabis businesses in the U.S. face unique challenges, from strict and ever-evolving regulations that vary across each state, to limited payroll providers.
  • By partnering with a cannabis PEO, companies can gain access to specialized professionals and intuitive technology.
  • At GreenLeaf HR, we provide PEO services to help cannabis businesses handle the administrative side of their business with ease. Contact us to get started!

Companies in the cannabis sector face unique HR challenges. With ever-changing regulations across different states and difficulties with payroll and banking, there are many hurdles to navigate. But fortunately, cannabis PEOs can help.

By partnering with a specialized firm, businesses in the cannabis industry can find the support, expertise, and technology they need to handle HR admin tasks.

Keep reading to learn more about cannabis PEOs and what makes them a vital resource for companies that want to scale and be more efficient.

Let’s get started!

Discover the 7 Reasons Why You Need to Hire a Cannabis PEO

What Is a Cannabis PEO?

A cannabis PEO is a Professional Employer Organization that provides HR solutions and services specifically designed for businesses in the cannabis industry.

Managing the administrative side of a cannabis business can be complex and highly time-consuming. By joining forces with a PEO, companies can delegate the responsibility of routine tasks —like payroll processing, benefits administration, compliance assistance, and risk management— and have more time available for higher-impact activities.

In such a heavily regulated industry, with legal requirements and industry standards evolving all the time, having an experienced partner by your side is the best alternative to ensure your cannabis business always stays compliant.

7 Reasons to Hire a Cannabis PEO

PEOs are on the rise in the U.S., with over 500 of them providing services to small and mid-sized businesses. With so many options, it might be difficult to find the right one for your business.

Choosing a PEO specialized in the cannabis sector is a wise, strategic move, as they are well-equipped to provide HR solutions tailored to your company’s needs and stay on top of cannabis regulations.

Here are the top 7 reasons to hire a cannabis PEO:

Gain Access to Industry Expertise

The cannabis industry has unique needs and fast-changing regulations that vary by state, so why not rely on the expertise of a cannabis PEO?

A specialized PEO knows the ins and outs of the sector’s legal landscape, including state regulations, licensing requirements, and compliance standards. This expertise allows them to provide tailored HR solutions that address the industry’s nuances, keeping your business safe and compliant.

Minimize Compliance Risks

Staying compliant is crucial for cannabis businesses. Companies need to follow strict regulatory procedures across the entire product lifecycle, from seed to sale. This involves having appropriate licenses, maintaining accurate record-keeping, labeling products accordingly, implementing security measures, and more.

Failing to comply with regulatory requirements can lead to negative consequences like license suspensions, fines, product recalls, and of course, the subsequent loss of consumer confidence.

With a cannabis PEO monitoring compliance at all times, you can be sure that your business’s HR best practices are aligned with industry-specific laws, reducing the risks of legal issues and keeping consumers safe.

Attract and Retain Top Talent

The American legal cannabis market is a fast-growing industry, with sales forecasted to reach $31.4B in 2024. This means that cannabis jobs will continue to be on the rise and companies will need to find competitive ways of attracting skilled professionals.

In this context, employee benefits play a decisive role.

By partnering with a cannabis PEO, companies can gain access to comprehensive employee benefits packages, including health insurance, retirement plans, and other perks. These benefits, typically unavailable to smaller companies, can yield a competitive advantage and help your business attract and retain top talent.

Make Payroll Processing More Efficient

Managing payroll can be complex and time-consuming, especially in the cannabis industry with its unique payroll considerations and the difficulties of accessing the U.S. financial system.

A cannabis PEO can help you streamline the entire payroll process, ensuring your employees are paid accurately, on time, and in compliance with tax regulations.

Mitigate Safety Risks

From workplace safety protocols to employment practices liability, cannabis businesses face various risks. A cannabis PEO can help you mitigate these risks by implementing best practices, safety training, and insurance coverage tailored to the industry’s needs.

Employment lawsuits can be devastating. A cannabis PEO can help you stay compliant with labor laws, reducing the risk of legal action.

Reduce Costs and Increase Efficiency

If you are a small cannabis company, you probably can’t afford to have an entire HR department. However, by partnering with a cannabis PEO, you can have access to a team of HR specialists without the overhead costs of salaries, benefits, and office space.

A PEO can provide administrative support on various HR tasks, taking weight off your shoulders and freeing up time and resources for you to focus on growth and operations.

On top of this, you can benefit from PEO’s technology platforms to automate many daily tasks, saving time and bringing accuracy to processes like payroll and tax filing.

Scale Your Cannabis Business

As your cannabis business grows, your HR needs change and evolve.

A cannabis PEO offers scalable solutions that can adapt to changing workforce dynamics, whether it’s expanding to new locations, hiring seasonal workers, or adjusting staffing levels.

Attract Top Talent with PEO’s Competitive Benefits

Partner with a Trusted PEO to Grow Your Cannabis Business

The cannabis industry is evolving and growing fast, posing new challenges for businesses. From hiring talented employees to processing payroll and keeping up with compliance requirements, there are too many things for a small HR team to tackle.

By engaging in a partnership with a cannabis PEO, companies can streamline admin processes and save time by delegating the most complex and time-consuming aspects of their business.

At GreenLeaf HR, we provide comprehensive PEO solutions to help you manage payroll, employee benefits, Workers’ Compensation, workplace safety, and more. Have a specialized partner by your side and free up time to grow your cannabis business! Ask for a free HR consult to get started.

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