If you bought a THC seltzer anytime this summer, or a CBD tincture at a corner shop almost anywhere in the country, there’s a good chance that the person who rang you up is about to have a strange couple of months.
Payment platforms are already walking away from hemp. Payroll could be next, and everyday workers will feel it first.
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Square, the payment platform behind countless small shops, cafés and market stands, will soon stop allowing CBD and hemp-derived products to be sold through its system completely. The company told merchants the change is tied to the coming federal redefinition of hemp, as Marijuana Moment first reported.
Shoppers will definitely notice when a favorite product disappears from the cooler or a store suddenly goes cash-only in our increasingly credit card-centric world. What they won’t see is the next domino, and it’s the one I worry about the most: payroll. Misclassifying workers poses serious risks for these entities; many don’t even have a clue of what they may face.
How your paycheck actually reaches you
Most of us never really think about how our paychecks move. An employer hands payroll to a provider. The provider pulls money from the employer’s bank account, withholds taxes, and deposits wages into workers’ accounts. Every step runs through the banking system, and every step depends on banks being comfortable with who is on the other end of the transaction; many of them aren’t comfortable with cannabis, and many would be risking the banking charter.
For state-legal cannabis businesses, that peace of mind remains elusive. When a bank’s compliance team flags potential cannabis exposure, payroll providers often drop clients on short notice, frequently giving them just two days to find alternatives.
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Some of the biggest national payroll firms, ADP among them, have long declined to take marijuana clients at all. And the caution rarely stops at dispensaries and grows. As far back as 2019, industry leaders reported mainstream providers cutting off medical offices, technology platforms, and other companies only loosely connected to the plant.
The businesses didn’t do anything wrong. Their industry just showed up on someone else’s risk report.
Hemp is about to join the club
For years, hemp-derived products lived in a federally legal zone that kept them off most banks’ radar, via the 2018 Farm Bill. That is ending in 2026.
Congress recently pushed the federal ban on naturally derived hemp THC products from November 12 to December 11, though synthetic cannabinoids stay on the original schedule. Whether lawmakers use that extra month to build a real regulatory framework or let the ban take effect is anyone’s guess; banks and payment companies have already started treating hemp the way they treat legal cannabis.
Square is simply the most visible example, and the first to act ahead of the final deadline.
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This reaches a lot further than many people realize. Across the country, hemp-derived CBD tinctures, topicals, and low-dose wellness products are sold in specialty natural food markets, local apothecaries, and wellness boutiques. Those businesses employ store managers, stock clerks, herbalists, and retail associates, most of whom have never thought of themselves as working in cannabis.
A payroll provider that discovers a single CBD product line on a boutique’s shelves could put the business’s entire payroll account under review, not just the employees directly handling those items.
Who pays when payroll breaks
When a payment processor leaves, a business loses some convenience. When a payroll provider leaves, people miss paychecks. The ban’s impacts hit hardest for those closest to the products, but will be felt industry-wide.
The workers in this industry are mostly hourly: budtenders, production staff, beverage line workers, bartenders. For them, a paycheck that lands three days late means a rent payment that lands three days late.
A rushed switch to a new provider also tends to produce tax-withholding mistakes that don’t surface until W-2s arrive the following January, just in time for spring tax season. None of these workers chose their employer’s banking relationships, and they shouldn’t be the ones who absorb the fallout.
What can be done before December
If you own a cannabis or hemp business, ask your payroll provider directly whether it knows what you sell, and whether its bank does. A provider that has never asked isn’t a safe one; it’s an uninformed one.
Know whether you’re using payroll software, where you remain the legal employer and carry every obligation that comes with it, or an employer-of-record arrangement, where a provider takes on that legal employer role. And have a backup plan before you need it. Two weeks is not enough time to move a workforce to a new system cleanly.
If you work in the industry, keep copies of your pay stubs and check that taxes are being withheld the way you expect. Most states set rules for how quickly wages must be paid, and your state’s labor department can help if a paycheck is late. It’s also completely reasonable to ask your manager whether the business has a plan.
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If you’re a customer or a voter, tell your representatives that legal products need legal infrastructure. Proposals like the Hemp Safety Enforcement Act from Senators Rand Paul (R-KY) and Amy Klobuchar (D-MN), which would let states and tribal governments regulate hemp products instead of imposing a blanket federal ban, point in a better direction.
But any lasting solution has to include access to basic banking and payroll services. A product that’s legal on paper but unbankable in practice isn’t regulated. It’s just banned more slowly.
December 11 is two months away. The people whose paychecks depend on this industry deserve better than finding out what happens on the day it arrives.
*This article was submitted by an unpaid guest contributor. The opinions or statements within do not necessarily reflect those of GreenState or HNP. The author is solely responsible for the content.