California Contractors Business Licenses

As a contractor, do you know what you must file with the city or county where your business is licensed? With an increasing urgency to verify people working in the U.S. are here legally, how do contractors actually know when you’ve been given the person’s ‘vital’ numbers that they’re real? Those answers and more as we ‘cut red tape’ …

Q: Does it matter who signs on behalf of the entities that are Limited Partners (LP) and General Partners (GP)? It is time to file our renewal and I was going to have our general counsel sign on behalf of both entities. Will this be a problem?

A: The CSLB will only recognize signatures from those individuals who were listed on the license application originally filed with the Contractors Board. This applies to both the GP and LP entities. In addition, the qualifying individual (RME or Qualifying partner) must also sign.

Q: Is a licensed contractor exempt from obtaining a business license in each of the many cities where he may complete a job? Is a business license adequate in the city where his office is located? Does the CSLB regulate this aspect of running our business?

A: Having a contractor’s license does NOT exempt you from needing a business license in the city or county where your business is located. However, I do not believe you need an additional local business license simply because you have customers in neighboring municipalities. To be certain, I suggest that you contact these cities directly.

While the CSLB does not regulate business licenses, they do have a requirement (B&P Section 7033), which specifies that a contractor have on file — with the city or county where they are based — a signed statement that their license is in “full force and effect”.

Q: We are members of the local Builder’s Exchange and have a quick question regarding I-9s and Social Security numbers. My information about these events is sketchy but recently we heard of some construction companies who received big fines for hiring workers with bogus Social Security numbers. My question is just what is our responsibility regarding the Social Security numbers our new hires present to us? We are very faithful in filling out I-9s and making copies of all ID. Are we supposed to be checking the validity of these IDs as well? And, if so, where do you go to do that? Thank you!

A: Thank you for your email. Since Capitol Services specializes in handling issues related to CA, AZ and NV State government, I do not receive many questions involving federal government agencies. Nevertheless, since your question can impact virtually any employer, I am happy to provide you with some basic information.

As you know, the Form I-9 is used for Employment Eligibility Verification. Its purpose is to document that each new employee — both citizen and non-citizen — is authorized to work in the United States. Employers are required to examine one or more documents to determine employment eligibility. This may include a US or foreign Passport, permanent resident card, driver license, government ID (with photograph), domestic or foreign birth certificate, Social Security card, etc. As the employer, you must attest under penalty of perjury, that you have examined the documents presented by the employee (from a specified list), and that they “appear to be genuine”.

The I-9 form has a space to list an employee’s social security number; however, the instructions for completing the form state, “Providing the Social Security number is voluntary, except for employees hired by employers participating in an electronic verification program (E-verify).”

For more information, I suggest visiting the following US Citizenship and Immigration Services web site: http://www.uscis.gov/files/form/i-9.pdf.

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