California Contractors License Waiver

Statistics from the Federal government show construction related deaths in the workplace dropped 41 percent last year. One in five California workplace deaths are construction related. You might guess roofers taking a tumble were particularly at risk, but strong emphasis on safety education, skewed the result away from this trade as the answer. According to statistics reported by the Sacramento Business Journal, more than half the 2007 victims were specialty contractors, including electrical, foundation, plumbing and HVAC workers…

Q: We sell a product door-to-door although another company handles actual installation. We disclose this fact to the homeowner. My question is twofold: Does our company need a contractor’s license (we would rather not)? Do our half-dozen sales people need to be registered with the State (they do not want to go through the process)?

A: As we discussed, your company is required to have a contractor’s license since the contract, as you describe it, is between your company and the homeowner and includes the words “sales and installation”.

In answer to your second question, all 6 salespeople should be registered as a Home Improvement Salesperson. The problem is a licensed contractor must employ them. If and when you decide to obtain a license, I suggest having each salesperson complete the proper Application for Registration; pay the required $50.00 fee; go through the fingerprinting process and do the right thing by complying with the law.

Q: I was told that if I work 20% of the time, I could be the company Responsible Managing Employee (RME). My employer also told me that as RME I would not be responsible for their work and they would give me something in writing that states this. I’m a bit worried because this does not seem right. What’s your opinion?

A: My opinion is to proceed with caution. As the RME for your employer, you must work 32 hours a week or 80% of the time the business is operating, whichever is less. Either way, you would need to be employed more than 20% of the time. Since by definition, you are the “RESPONSIBLE Managing Employee”, you certainly have responsibility for the work performed – even with “something in writing” from your employer.

Q: Can you please help me with some information? My father-in-law has been a general contractor for approx 40 years. I started working for him about 5 years ago and 3 years ago we incorporated the company with my father-in-law as President and me as VP.

My father-in-law has just had his 70th birthday and wants to “retire”, and have me run the business with his license. He seems to think that the license can be transferred to me and that it is possible to waive the contractor’s licensing exam. Is this correct, and if so how do we do it? Any information or options that you can offer would be greatly appreciated.

A: Business & Professions Code, Section 7065.1 allows for a waiver of the license exam under certain circumstances. Unfortunately it appears you are in between two different Sections of this law. Subsection “(b)” allows for a waiver by an immediate family member of a licensee whose INDIVIDUAL license was active and in good standing. Subsection “(c)” allows for a waiver if replacing the qualifier on a CORPORATION. In both cases you must show that you’ve worked for the individual or company for five of the seven years immediately prior to filing the application.

According to someone I spoke with at the Board, since your 5 years is split between the two license entities, the CSLB will almost assuredly require that you pass the proper exams. Further, they cannot transfer his “individual” license since it is now assigned to the corporation; however, you can replace your father-in-law as the qualifying person on the corporation license.