Hiring Compliance for Minnesota Cannabis Businesses
Minnesota is one of the more legally complex states when it comes to hiring, with stronger-than-average employee protections. The state has a long-standing ban-the-box law, a salary history ban, a pay transparency requirement that took effect in 2025, strong off-duty cannabis use protections, and a regulatory background check framework through the Office of Cannabis Management that operates separately from general employment screening law.
Minnesota cannabis hiring compliance means navigating all of these layers at the same time, often starting before a candidate even applies. This guide walks through each one clearly, so you know exactly what your hiring process needs to look like and why.
Table of Contents
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- Where Minnesota Hiring Gets Complicated for Cannabis Operators
- Ban the Box: What Minnesota Requires
- Cannabis Expungement and What It Means for Background Checks
- The OCM Background Check Requirement
- Pre-Employment Drug Testing: The Rules Have Changed
- Pay Transparency: Salary Ranges in Job Postings
- The Salary History Ban
- Creating a Compliant Minnesota Hiring Process
- FAQ
Where Minnesota Hiring Gets Complicated for Cannabis Operators
Most cannabis operators come into the hiring process knowing there is a background check requirement through the Office of Cannabis Management. What they often don’t realize is that the OCM background check is just one of several overlapping frameworks that govern how they can screen and select candidates.
Minnesota has its own ban-the-box law with teeth. It has expunged a significant number of cannabis-related criminal records from public view, which affects what you can see and use in screening decisions. It has a Drug and Alcohol Testing in the Workplace Act that was majorly amended when recreational cannabis was legalized in 2023, changing when and how you can test for cannabis. And it has a pay transparency law effective January 2025 that requires salary ranges in job postings for employers with 30 or more employees.
None of these frameworks operate independently of the others. A hiring process that satisfies the OCM background check requirement but violates the ban-the-box law is still out of compliance. A job posting that satisfies pay transparency requirements but asks about salary history is still problematic. The whole process needs to be thought through as a system.
Ban the Box: What Minnesota Requires
Minnesota’s ban-the-box law, codified under Minnesota Statutes Section 364.021, applies to private employers with 15 or more employees. It prohibits employers from asking about an applicant’s criminal history during the initial application process.
Minnesota’s statewide ban-the-box law applies to both public and private employers. Companies with 15 or more employees must comply. The law prohibits criminal history questions during initial applications. Instead, employers must wait until interviews or conditional offers occur.
This means your job application can’t include a question about criminal history, and you can’t search publicly available records on an applicant during the initial screening stage. Criminal history questions are permitted once you have selected a candidate for an interview or extended a conditional offer, depending on your process.
Minneapolis has its own enhanced ordinance. Minneapolis applies ban-the-box rules to employers with six or more employees, delays criminal history questions until after conditional job offers, and, effective August 1, 2025, Minneapolis expanded protections for people with criminal histories by adding justice-impacted status as a protected characteristic.
If your dispensary operates in Minneapolis, you need to pay extra attention. The city’s standard is stricter than the state standard, and the addition of justice-impacted status as a protected class adds a new layer to adverse action decisions based on criminal history.
Beyond timing restrictions, Minnesota limits what criminal history can actually be used in a hiring decision. Minnesota law generally prohibits employers from considering certain older criminal records. Specifically, you cannot use, distribute, or disseminate records of arrests that did not lead to a conviction, annulled or expunged convictions, or misdemeanor convictions for which no jail time was served. A conviction can’t be the basis for disqualifying an applicant if more than seven years have passed since the date of conviction or the end of the incarceration period, and the person hasn’t been convicted of any other crime since. However, this seven-year lookback limit doesn’t apply if the conviction directly relates to the specific job duties and responsibilities of the position.
That last sentence is critical for cannabis operators. The lookback limit can be set aside when the conviction is directly related to the job. A felony for financial fraud may be directly relevant for a role handling cash or inventory. A conviction with no connection to your dispensary’s operations likely can’t be used to disqualify an otherwise qualified candidate, regardless of how old it is.
Cannabis Expungement and What It Means for Background Checks
Minnesota’s Adult-Use Cannabis Act and Clean Slate Act created an automatic expungement process for cannabis-related criminal records that affects what appears on background checks for a significant number of job applicants.
The Minnesota Bureau of Criminal Apprehension automatically expunged approximately 57,000 cannabis-related records. Misdemeanor cannabis convictions that qualified for automatic expungement were sealed from public view. The Cannabis Expungement Board is separately reviewing approximately 110,000 felony and other cases that were not eligible for automatic expungement and require case-by-case review.
What this means for your hiring process is straightforward but important. Expunged records should not show up on most criminal background checks. If a candidate had a minor cannabis conviction that has been automatically expunged, that conviction won’t appear on a properly conducted background check, and the candidate has no obligation to disclose it.
You can’t ask candidates whether they have expunged records, and you can’t use an expunged record as a basis for a hiring decision if somehow it does appear. The whole point of expungement is to remove that barrier. For cannabis operators specifically, this legal framework reflects a deliberate policy choice by the Minnesota legislature: the people most likely to have cannabis records are also the people the industry was designed to create opportunities for.
The practical implication is that you should not assume a clean background check is incomplete or that a candidate is hiding something. A background check that shows no cannabis history may simply reflect that the relevant records have been expunged as the law intended.
The OCM Background Check Requirement
Separate from the general employment background check framework, Minnesota’s Office of Cannabis Management requires background checks for all employees of licensed cannabis businesses. This is a regulatory requirement that exists alongside, not instead of, general employment screening law.
Employees of licensed cannabis businesses are required to complete background checks before employment. OCM currently permits cannabis business license holders to utilize third-party consumer reporting agencies or background screening companies pursuant to Minnesota Session Laws 2024, chapter 121, article 2, section 149. All criminal history checks must be conducted by a third-party consumer reporting agency or background screening company that is in compliance with the federal Fair Credit Reporting Act and accredited by the Professional Background Screening Association.
An important 2026 update: effective March 1, 2026, cannabis businesses and their prospective employees who have not yet completed a background check must do so through the Bureau of Criminal Apprehension process. This replaces prior screening methods and applies across all roles in licensed cannabis retail operations. If you’ve been using a third-party screening company under the previous process, verify that your procedures align with the current BCA requirement and build the processing time into your hiring timelines.
The OCM has specific disqualifying conviction categories. A license holder must not employ anyone as a cannabis worker if they have been convicted of any of a specified list of felonies, or if they made any false statement in an application for employment. It is the license holder’s responsibility to determine whether any prospective employees have a disqualifying conviction.
License holders should maintain documentation of their hiring practices and background screening procedures in case OCM requests or requires review. This should include confirmation that each employee has received a passing background check before employment.
The interaction between the OCM background check and the state’s ban-the-box and expungement requirements requires careful sequencing. You can’t conduct the OCM background check until a conditional offer has been made (satisfying ban-the-box), you can’t use expunged records in your decision, even if they appear, and you can only disqualify based on the specific felony categories OCM has defined, not on a general comfort level with a candidate’s history.
Pre-Employment Drug Testing: The Rules Have Changed
This is where Minnesota cannabis hiring diverges most sharply from what operators in other states might expect, and where the most compliance mistakes happen.
Unless the employer is otherwise required to do so by state or federal law, an employer can no longer require or request a job applicant to undergo pre-employment cannabis-specific testing or refuse to hire an applicant just because the person tests positive for cannabis as a result of an authorized pre-employment drug test.
For most dispensary positions, this means you can’t screen out candidates based on a positive cannabis test at the pre-employment stage. In a state where cannabis is legal, and the Adult-Use Cannabis Act explicitly protects off-duty use, this prohibition makes sense. Off-duty use is protected, and you can’t use a positive test result to exclude a candidate from a non-safety-sensitive role.
Minnesota’s amendment to the Consumable Products Act also makes it illegal for employers to take action against a job applicant or a current employee based on their off-premises, off-duty use of cannabis products. There are exceptions for specific position types. For safety-sensitive positions where impairment caused by drug, alcohol, or cannabis use would threaten the health or safety of any person, cannabis testing may continue. For a standard budtender role, none of those exceptions apply. Your pre-employment screening can’t include a cannabis-specific test for that position.
You can still, and should, prohibit impairment at work. The amended law doesn’t impact an employer’s right to discipline or terminate an employee who uses, possesses, sells, transfers, or is impaired by cannabis products during working hours, while on work premises, or while operating an employer’s vehicles, machinery, or equipment.
Your written drug and cannabis policy needs to reflect this clearly. The policy should prohibit on-premises use and impairment during working hours, describe when reasonable suspicion testing can occur, and explain consequences for violations. Under Minnesota’s Drug and Alcohol Testing in the Workplace Act, any drug or cannabis testing policy must be in writing and meet specific content requirements before it can be enforced.
Pay Transparency: Salary Ranges in Job Postings
Minnesota’s pay transparency law took effect January 1, 2025, and applies to employers with 30 or more employees at one or more sites in Minnesota.
Covered employers must disclose the starting salary range for the posted position. The law defines salary range as the minimum and maximum annual salary or hourly range of compensation, based on the employer’s good faith estimate at the time of the posting. An open-ended salary range is not allowed. If the employer doesn’t plan to offer a salary range, then they must instead list a fixed pay rate. Employers must also provide a general description of all benefits and other compensation to be offered to the hired job applicant.
The scope of this disclosure requirement is broad. A job posting is defined as any promotional recruitment materials, so pay transparency requirements extend to social media posts, flyers, or any other digital or hard copy material that includes a job description and qualifications.
If your operation has 30 or more Minnesota employees and you are posting for any position, including part-time dispensary staff, cultivation workers, or management roles, every posting must include a genuine good faith salary range and a description of the benefits you offer. Vague language like “competitive pay” or “DOE” is not compliant.
For cannabis operators below the 30-employee threshold, the pay transparency posting requirement doesn’t apply. But the salary history ban, described below, applies to all Minnesota employers regardless of size.
The Salary History Ban
Minnesota prohibited employers from asking about or using an applicant’s salary history effective January 1, 2024. This applies to all employers in the state, regardless of size.
Effective January 1, 2024, Minnesota prohibited employers from asking about or considering job applicants’ past or current pay during the hiring process. The law applies to all job applicants, including current employees seeking an internal promotion or transfer, and full- and part-time employees. While job applicants can voluntarily, without prompting, share past or current pay to negotiate higher pay, employers may not request that information.
Review your job applications and interview guides. Any question about current salary, most recent pay rate, or compensation history needs to come out. This includes questions on online application forms, verbal questions during interviews, and reference check questions that probe compensation history.
The distinction between prohibited questioning and voluntary disclosure matters. If a candidate tells you what they were making at their last job without you asking, you are not required to ignore that information entirely. But you can’t prompt it, and you can’t use it as the primary basis for setting the candidate’s starting pay.
Creating a Compliant Minnesota Hiring Process
Here is how a compliant Minnesota cannabis hiring process looks from start to finish.
Your job posting must include a good faith salary range and benefits description if you have 30 or more Minnesota employees. No salary history questions can appear anywhere in the posting or application. No criminal history questions can appear in the application.
Your screening process evaluates candidates on qualifications first. Criminal history is not discussed or researched until the interview stage or until you are ready to extend a conditional offer, depending on your process and size.
You extend a conditional offer to your preferred candidate. At that point, you initiate the OCM-required background check. You review the results against OCM’s specific disqualifying conviction categories. You do not use expunged records, arrests that did not result in convictions, or convictions outside the seven-year lookback window (unless directly job-related).
If the background check is clear, you proceed to hire. If a disqualifying conviction appears, you follow the individualized assessment process required by Minnesota law before making a final adverse action decision.
You don’t conduct a pre-employment cannabis test for standard dispensary positions unless the role qualifies for one of the exceptions. Your written cannabis and drug testing policy, which meets DATWA requirements, is provided to the new hire before any testing and is posted in a conspicuous location in the workplace and in your employee handbook.
Our Minnesota Cannabis Hiring Toolkit gives you the structural foundation for this process, including state-specific compensation benchmarks for the typical positions in a Minnesota cannabis operation, which are the starting point for setting your good faith pay ranges. Many operators build their posting templates from those benchmarks and save significant time getting their hiring documentation into compliance. If you are posting jobs in Minnesota without documented pay ranges and a consistent screening process, that is a major compliance risk.
FAQ
Does the Minnesota pay transparency law apply to my dispensary?
It applies if you have 30 or more employees at one or more sites in Minnesota. Most established dispensary operations meet that threshold once you count full-time and part-time staff together. If you have fewer than 30 employees, the posting requirement doesn’t apply, but the salary history ban and ban-the-box requirements still do.
Can I ask candidates about their cannabis use during an interview?
You can ask whether candidates are aware that the position prohibits on-duty impairment and whether they can comply with that requirement. You can’t ask about their personal cannabis use habits, whether they currently use cannabis, or when they last used it. Off-duty use is protected, and probing for it creates discrimination exposure under the Consumable Products Act.
A candidate has a gap in their work history that I suspect is related to a cannabis conviction. Can I ask about it?
You can ask about employment gaps in general terms, as long as you aren’t using the question to probe criminal history before the appropriate stage of your process. If a candidate volunteers information about a past conviction during this conversation, you can note it, but you should not have prompted it. If you haven’t yet extended a conditional offer, defer any criminal history discussion until you have.
What happens if the OCM background check reveals a record that was expunged?
Expunged records aren’t supposed to appear on properly conducted background checks. If one does appear, you should not use it as a basis for any employment decision. Contact your background check provider about the discrepancy. Using an expunged record against a candidate creates liability under both state employment law and the federal Fair Credit Reporting Act.
We have fewer than 15 employees. Does the ban-the-box rule still apply to us?
The statewide ban-the-box law applies to employers with 15 or more employees. If you have fewer than 15, you are not covered by the state statute. However, if you operate in Minneapolis, the city ordinance applies to employers with 6 or more employees. Check your specific jurisdiction before assuming you are exempt.
Do we need a written drug and cannabis testing policy even if we don’t plan to test for cannabis?
If you have any drug testing policy at all, it needs to be updated to address cannabis separately under DATWA. If your policy currently treats cannabis the same as any other drug, that language is likely non-compliant. A written policy that clearly defines what you prohibit (on-duty use and impairment), when testing can occur (reasonable suspicion, post-accident), and what the consequences are is worth having, regardless of your position on pre-employment testing, because on-duty impairment situations can arise in any operation.
