Doing business as a contractor is difficult and rewarding, but the learning curve never ends. The complex rules that govern contracting matters both large and small can extend to a single word in your company name…
Q: I formed a new solar company and submitted my application to the CSLB well over a month ago. I called the Board and was told it was referred to someone three weeks ago to “review my business name”. I need this license to go to work and I can’t get anyone to tell me why there is a delay. My corporation is registered with the Secretary of State; I have my business license; so what could be the problem?
A: Code Section 7059.1(a) gives The Contractors Board the right to review any business name to determine if it is misleading or incompatible with the classification or type of business entity. The fact that the Secretary of State or your local government allows a name has little impact on what the CSLB may determine.
In your case, my guess is they’re looking at the word ‘solar’ to determine if it’s compatible with the general building classification you’ve applied for. While a “B” can legally perform all types of ‘solar’ work, the Board may not allow you to use the word in your business name since it implies you hold the “C-46” (Solar) classification. This being said, I cannot explain why the Board has delayed your application processing for several weeks. The Board is to be praised for knocking down much of its backlog for reviewing applications but this appears to be a weak link in the processing chain.
You may want to call the Board a second time and ask to speak with the person who is reviewing your file. Hopefully, you’ll get an answer and move forward or change the name style if necessary.
Q: We have a Responsible Managing Employee (RME) on payroll whose employment contract is due to expire in 6 weeks (July 1st). The project we’re working on at the present time is due to be completed no later than August 30th. What happens with our license if our employee in fact leaves? Will we legally be able to complete the project? When I called the Contractors Board they told me this was a “legal issue” and could not give me an answer.
A: The person you spoke with could have informed you that your company will automatically be granted 90-days to replace the Qualifier (RME) from the day he disassociates from your license. During this time period, the license will remain in good sanding as if the RME were still employed. Your company will in no way be limited in your ability to work on this project or any other project (assuming all other requirements such as bonding, Worker’s Comp, etc. are still in place), and, no unexpected delays in completion occur.
Your company can file an application to replace the qualifying individual and, if necessary, request an additional 90-day extension (bringing the total to 180 days). This extra time to replace your RME is evaluated on a case-by-case basis; however, in my many years of experience, I have rarely seen them deny this type of request.