Shemia Fagan Joined an Industry Fighting Against the Unionization of Cannabis Workers

As Oregon Democrats mourn the downfall of one of their brightest stars, Secretary of State Shemia Fagan, the state’s largest private-sector union is hoping that the increased scrutiny on her benefactors, the owners of the troubled cannabis dispensary company La Mota, might brighten prospects for its highest-priority bill in Salem.

Fagan resigned May 2 after WW revealed that she’d signed a $10,000-a-month consulting contract with an affiliate of the cannabis chain La Mota, which also promised her a $30,000 bonus for each cannabis license she helped the affiliate get outside of Oregon and New Mexico.

When Fagan signed the contract in February, she was joining a chain—and an industry—with a checkered track record around its labor force.

In addition to the financial problems that La Mota’s owners, Aaron Mitchell and Rosa Cazares, and the companies they control face—more than $7 million in state and federal tax liens and a number of lawsuits, many of them alleging unpaid bills—are allegations that La Mota treats workers poorly.

Records show that at least 21 former La Mota employees have filed complaints with the Oregon Bureau of Labor & Industries since 2019, alleging a variety of workplace issues, including late or unpaid wages and unsafe working conditions stemming from frequent armed robberies at cannabis dispensaries.

Ironically, Fagan won election as secretary of state in 2020 with millions of dollars worth of support from organized labor, including $50,000 from United Food and Commercial Workers.

“Our support of Shemia Fagan was a result of her voting history [as a legislator] and her historic support of labor issues. And I think that those are still values she cherishes,” says UFCW lobbyist Michael Selvaggio. “It’s surprising she took that contract.”

This legislative session, UFCW Local 555 stamped “Top Priority” in red ink across the top of the legislative concept that became House Bill 3183.

The bill would pave the way for UFCW and other labor organizations to organize workers in the cannabis industry, which generates more than $1 billion in annual sales and, according to state figures, employs nearly 8,000 people (those numbers are for the legal market and do not include black-market sales or jobs).

Cannabis industry workers, UFCW says, often work in “unsafe conditions, without appropriate protective equipment and for subpar or even off-book wages in some cases.”

HB 3183 would require cannabis companies applying for state licensure to agree to what are called “labor peace agreements,” in effect certifying, according to the official bill summary, that they “will not interfere with labor organizing efforts.” The union says similar laws are already on the books in California, New York and New Jersey.

“This bill is our top priority this session,” say UFCW’s Selvaggio.

Normally, labor-friendly bills sail through the Democratically dominated Capitol, but Selvaggio says HB 3183 remains mired in the House Rules Committee.

“It’s bizarre and frustrating that the bill seems to be stalled out given there are significant ongoing worksite safety issues yet to be resolved in this industry,” Selvaggio says.

He notes that when the bill got a public hearing earlier this session, the strongest pushback came from a lobbyist representing the Oregon Cannabis Association.

In addition to verbal testimony from OCA lobbyist Taylor Sarman, there is written testimony filed in opposition to the bill under the name of Amy Margolis, who has served as executive director of the Oregon Cannabis Association. Margolis, a lawyer who represents La Mota in pending litigation, said in an email, “The OCA lobbyist submitted the testimony under my name,” but Margolis says she did not write the testimony herself. That testimony also reflected the opposition to HB 3183 from a second, larger industry group, the Cannabis Industry Alliance of Oregon.

Selvaggio says he thinks the bill may get more traction with lawmakers as the political sway La Mota has sought appears to have waned.

“What we’ve learned over the past month is that influence can be fleeting,” Selvaggio says. “I don’t think La Mota’s political donations had a direct impact like, ‘Let’s stop the bills they don’t like’, because they weren’t giving enough to do that.”

“But I think that La Mota’s actions did buy them a bigger seat at the table,” Selvaggio adds. “I think that with the blowback, that seat has evaporated.”

Oregon Cannabis Association board Hunter Neubauer, the chairman of the cannabis firm Oregrown Inc., says the industry has negotiated amendments to HB 3183 that would allow the OCA to change its position on the bill from opposed to neutral should lawmakers accept that amendment. Neubauer says La Mota is not involved in those discussions with UFCW.

“La Mota and its owners had no impact or influence on this decision or any moving forward decisions regarding 3183, and OCA does not know La Mota’s current position on this bill,” Neubauer says in an email. “OCA is grateful for the UFCW’s work on this and willingness to engage with the cannabis industry to find a workable compromise.”

HB 3183 is not yet scheduled for further consideration.