Unlicensed Contractors Enforcement

The benefit of having the latest news from important government meetings often means you have to attend. For contractors time is money, and that’s why I’m your ‘eyes and ears’ in these meeting rooms. Reducing unfair competition for licensed contractors is one of the ‘hang ups’ government regulators are making the ‘call’ on in these sessions…

The CSLB held several Committee meetings in Sacramento on May 25 and 26. As someone who attends many of these, I must admit this is not the most exciting way to spend an afternoon. However, for contractors, the actions taken (or even discussed) by the Board can impact their livelihood.

The Enforcement Committee, chaired by Ed Lang, reviewed several ‘Strategies to Combat Unlicensed Practices’. Among the suggestions were a recommendation that CSLB staff meet with the California Public Utility Commission (CPUC) to develop policies and procedures that would allow business telephone numbers to be disconnected. The thought is that if an identified phone being used by an unlicensed contractor could be disconnected, this would reduce unlawful competition for legitimate licensed contractors and enhance consumer protection.

A second suggestion was to continue urging newspapers, Yellow page directories, and other publications to not accept ads from contractors unless a contractor’s license number is listed. Again, the strong belief is that reducing the number of print and online ads from unlicensed individuals would improve consumer protection and diminish unlawful competition. The problems are convincing news organizations that are struggling financially to forgo a paid advertisement of any kind, or to confirm the license number is legitimate.

As part of the 2009-2010 Enforcement Strategic plan, the CSLB worked closely with the Department of Industrial Relations (DIR) to develop a Web-based Public Works tool kit. This can be used to educate prospective bidders as well as winning contractors on their responsibilities under CA law regarding prevailing wage, Cal/OSHA’s Consultation Service, health and safety issues, etc. A link to this tool is on my web site (www.cutredtape.com).

As part of the 2010-2011 Strategic Plan, the CSLB Enforcement Division is looking to establish a dedicated Public Works Investigative Unit in an effort to further enhance partnerships with local government agencies and private industry associations. The focus would be to address egregious regulatory violations by public works contractors including illegal sub-contracting violations and contractors working without a license or outside their classification. Both reports were discussed in detail and the Committee unanimously recommended approval to the full Board.

CSLB staff delivered a detailed report to the Licensing Committee, chaired by Joan Hancock. For the first time that anyone can remember, applications for an original license are being pulled for review almost as quickly as they are coming into the Board’s headquarters. One reason is an overall 13% decrease in applications received. The Board members present offered congratulations to licensing and enforcement staff for their hard work especially in light of staff reductions and furlough days.

Chairman Robert Brown and the Public Affairs Committee were given a detailed listing of CSLB activities covered by newspapers, television and other publications during the past few months. This included extensive coverage of sting operations around the State to nab unlicensed contractors; ‘scam’ warnings for homeowners, especially senior citizens; and court actions (against both licensed and unlicensed contractors), which resulted in heavy fines and jail time.

One last item that was briefly discussed involved instituting a requirement that all active licensed contractors – with a Worker’s Comp exemption on file – be required to confirm every year or two that they in fact have NO employees. Contractors that carry Worker’s Compensation must present a new certification each year or risk having their license suspended. Those who file an “Exemption” stating they have no employees may have initially filed this document when they were first licensed (and legitimately had no employees), but have since hired one or more workers.

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