MI Passed ​A Background Check Bill For Marijuana Businesses​

May 16, 2019
Governor Gretchen Whitmer signed a bill that creates new background screening requirements for the marijuana industry.
Backgrounds Online | May 16, 2019


Governor Gretchen Whitmer signed a bill that creates new background screening requirements for the marijuana industry.

About The Bill

In 2018, Michigan implemented a law that stipulates any person who has an ownership stake for a medical marijuana business must authorize a state-run criminal background check. Upon satisfactorily passing, the individual can be granted a license. Senate Bill 203 created additional background screening regulations.

Michigan now requires background checks on individuals who apply for the following positions within the marijuana industry:
· Managers.
· Anyone with a direct or indirect business interest exceeding 10%.
· Any person who has a sole proprietorship.
· Any person with a partnership or limited liability partnership.
· General and limited partners.
· Members and managers of a limited liability company.
· Corporate officers or employees with equivalent titles for private corporations.
· Any member of a multi-level ownership enterprise who may annually receive more than 10% of gross or net profits.
· Individuals or members of non-profit corporations who have shareholders rights (in accordance with articles of incorporation or bylaws).
· In most of these cases, spouses must also be background screened.

Senate Bill 203 was signed by the Governor on April 16, 2019. Learn more.

Support For The Bill

The bill received strong support from MI lawmakers. Senator Michael McDonald , a sponsor, stated: “The goal of this reform is to provide additional clarity to the state’s medical marijuana law and improve the licensing process for everyone involved. My bill will enable state regulators to more effectively and efficiently do their job and protect Michigan families.”

Other supporters of the bill were said to feel it will improve the effectiveness of medical marijuana oversight. While the 2018 law regarding background checks is still seen as worthwhile, the overall goal of the new bill is to improve regulations and guidelines for this growing industry.

What MI Employers Should Know

Employers in Michigan that are involved in the marijuana industry should be aware of Senate Bill 203. It updates the definition of an “applicant” for a marijuana business license. Individuals who fit this definition will be required to authorize and pass a background check before a license is granted.

In recent years, a few states have legalized the use of medical marijuana. Additional state laws may follow. As more Americans become involved in this industry, employers must remain compliant with new laws that are passed where they operate. Each employer may wish to consult with legal counsel to review relevant laws and internal policies.

The Importance Of Background Checks

Background checks are mandated for various industries and positions. There is a good reason for this. A background report can help a hiring manager determine if a candidate has the qualifications, license, employment history or education they need to succeed. It can also show if an applicant has a serious criminal conviction that could render them ineligible for employment.

Many convictions are minor and would not cause an organization to refuse to hire a candidate. However, employers should always perform due diligence to check for violent, sexual and other reportable criminal records. Hiring an individual who has a serious conviction can lead to a loss of trust in your brand and legal repercussions.

If you are hiring, bringing or contractors or in need of volunteers, background checks are a crucial component in your process. The team at Backgrounds Online can help you customize FCRA compliant background checks for any position. Contact us Monday through Friday from 5am to 6pm for immediate expert assistance.