In a recent press release, California Contractors State License Board Registrar Steve Sands reminds contractors that “[c]ontractor licenses are not transferrable between anyone: associates, friends – family members included.” In California, all home improvement jobs valued at $500 or more, which includes both labor, material costs and other item costs combined, are required to be performed by a person or entity that is properly licensed by the CSLB. The licensee is responsible for the work performed under its contractor’s license number being done in all material respects in accordance with accepted trade standards for good and workmanlike construction. If it is not, it is exposed to disciplinary action by the CSLB, which could include a civil penalty and/or citation, among other things. It is also responsible for maintaining the appropriate bond (Cal. Bus. & Prof. Code § 7071.6) and workers’ compensation insurance (Cal. Bus. & Prof. Code § 7071.6).
Moreover, California Bus. & Prof. Code § 7068.1 requires the licensee’s qualifier (e.g., the responsible managing employee (RME), officer (RMO), or manager/member (RMM)) to be responsible for exercising that “direct supervision and control of his or her employer’s or principal’s construction operations” to secure compliance with the Contractors’ State License Law, Bus. & Prof. Code §§ 7000 et seq. A violation of Section 7068.1 comes with a hefty civil penalty and the possibility of a criminal penalty. Subdivision (e) of Section 7068.1 contemplates that it “shall constitute a cause for disciplinary action and shall be punishable as a misdemeanor by imprisonment in a county jail not to exceed six months, by a fine of not less than three thousand dollars ($3,000), but not to exceed five thousand dollars ($5,000), or by both the fine and imprisonment.” The CSLB recently warned license qualifiers that, “[w]ith consumer risk in mind, CSLB is aggressively and stringently taking enforcement actions against those involved in this trend [of not properly supervising work that is being performed]… .”
Additional Source: CSLB, Watch Out for Contractor’s Who Try to ‘Share’ a License