Licensing laws in California are very important to follow they will protect you as a consumer, so check requirements and verify contractor licensing before hiring.
It’s down to two. You’ve vetted a long list of contractors. Wheat has emerged from chaff. Now the final decision gets tough. Each contractor appeals to you for different reasons. They’re almost identically qualified, with one difference: one’s licensed, the other isn’t. Homeowners can pay the price when they fail to distinguish between the two.
Questions float through your head: What does it really mean to be licensed? Why are some contractors licensed and others not? And the ultimate question: Does it matter?
California state strictly enforces their licenses laws. Contractors pay a tidy sum to play by the rules in California, which makes it hard for them to compete against those who don’t. Homeowners can pay the price when they fail to distinguish between the two.
Don’t be fooled by “occupancy permits” or business licenses. These pieces of paper are worthless to you. Any business owner can get one. When I say licensed contractor, I’m talking about a person who has proved his skill in the field and been awarded a specialty license just for contractors. Hint: Ask the contractor if he had to take a test to get his license. He should have.
There are a LOT of unlicensed contractors out there. Anyone can claim to be a contractor, but few are licensed. That said, because of the cost a licensed contractor must pay to maintain their standing, licensed contractors tend to have higher overhead cost than their unlicensed counterparts. Translation: Licensed contractors are more expensive. Now ,if you are a penny-pincher who loves to find a good deal and if two guys can both do the wok, and one is $25/hr (UNLICENSED) and the other is $45/hr (LICENSED), is it a terrible idea to go with the cheaper guy? In other words, as a homeowner, does it really matter if they are licensed, as long as the work gets done?
YES. IT MATTERS.
A Contractor who is license by law must have workman’s compensation insurance on themselves and their employees. This insurance helps to protect you, the owner, in the relatively frequent occurrence that someone gets hurt on the job. Without that insurance, it’s likely the hurt individual will go after YOU to pay their medical bills. How would you like a $40,000 lawsuit on top of that $400 paint, electrical or plumbing job?
If a homeowner decides to hire a contractor to paint a house, can one of the contracted workers sue the homeowner for injuries that happen on the job? In many cases the answer is yes. So, homeowners need to be conscious of the risk of potential lawsuits when painting or renovating a home.
If you still aren’t convinced that it’s worth it to hire a licensed contractor, consider the following:
At Fault Homeowners
Homeowners who hire unlicensed contractors, (an unlicensed contractor is an employee not a contractor) can be found at fault for their part in the underground economy. If a homeowner contracts for a significant residential painting or remodel, he or she is treated as an employer and is required to provide a safe place of employment. Homeowners must comply with California OSHA safety regulations. If an unlicensed contractor has an employee who is injured during the job, the injured worker may be able to file a lawsuit against the homeowner for violating the law regarding the hiring of an unlicensed contractor. Homeowners may mistakenly believe that homeowners’ insurance policies would cover such accidents, this is not usually the case.
Here is a couple of real-life examples from our customers of what can happen if you hire someone who is not licensed.
The nice guy (unlicensed contractor) was painting when he fell off the ladder. He suffered a collapsed lung and three fractured ribs and was in the hospital for about 36hrs. The homeowner found the unlicensed contractor’s lying in pain after fall and called 911. He was working as an independent contractor with no workers comp ins, nor was he bonded or insured. Homeowner was responsible to pay for all his medical bills and lost wages ,besides being sued to cover further expenses.
He seemed great, at first. Walked the walk, talked the talk, drove a nice truck, looked us in the eye, and assured us he could complete our project within our one-week timeframe. He was also “licensed.” This guy was legit, or so we thought. After signing a contract and giving him a $2,000 down payment for materials, we let him at it. A couple days into the project, we started feeling like something wasn’t right. Nothing was getting done, and the clock was ticking. After repeated calls, he again assured us all was well —he was just finishing up a couple loose ends on another project before starting ours; not to worry, it would get done. A few days later, after no progress on our project, we knew something was wrong.
We went online to do a little research and learned that this particular contractor was NOT licensed, needles to say we never heard from him again. We lost our hard earned money.
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