Whenever you hire a contractor to work on your property, you should make sure he or she (or their firm) is duly licensed. Doing work without a license can have major consequences -- for both sides. For the contractor, it can mean an inability to collect (see Business & Professions Code section 7031).
While that might sound like a good thing for the homeowner (assuming the work has been done properly!), there is another side to the coin. If an unlicensed contractor’s workers are injured while working on your property, you can be deemed their “employer” for workers compensation purposes. (See California Labor Code section 2750.5 and Rosas v. Dishong , 67 Cal.App.4th 815 (1998).) In addition, you could get sued in general tort (personal injury liability) and if so, a trickier question is whether Cal-OSHA jobsite safety requirements will apply to the claim.
In Cortez v. Abich, the California Supreme Court held that the Cal-OSHA requirements did apply in an “unlicensed contractor” setting. Although there is an exception for homeowners who employ certain “domestic workers,” the court found that the exception did not apply where there was extensive remodeling, including the addition of several rooms to the home.
A complete copy of this ruling is attached for your convenience. The lesson here is that anyone hiring a contractor should first check to make certain the firm is licensed (this is easy to do at the Contractors State Licensing Board (CLSB) website (www.cslb.ca.gov)). In addition, make certain that the contractor has adequate workers compensation and liability insurance in place to cover potential claims; ask to see official certificates of insurance. Moreover, make certain that YOU have coverage, should the unthinkable happen. And finally, make sure the working conditions are safe and insist that the contractor do the same for his crew.
At Slote & Links, we regularly consult on construction related issues. We’ve represented all sides to these cases – owners, contactors, subs, architects, developers, and consultants. If you have an issue in this area, fell free to give us a call. We take pride in being efficient and effective advocates and counselors.