California law requires that every licensed contractor must have on file at all times with the Contractors State License Board a current and valid Certificate of Workers’ Compensation Insurance, Certificate of Self-Insurance or file a certificate of exemption demonstrating they are not required to obtain or maintain workers’ compensation insurance.
On January 13, 2021, Senator Bill Dodd introduced the Worker Protection Bill to amend Senate Bill 216, which is focused on contractor workers’ compensation insurance. This bill is not yet approved and a take-effect date has not been announced.
“For the most part, contractors do carry workers’ compensation insurance but too often, they do not,” Sen. Bill Dodd said. “My bill will eliminate barriers to coverage so we can protect those employees who might be injured on the job.”
Bill status: As of March 22, the bill was placed on suspense file, meaning the California Senate Appropriations Committee will review the bill by the end of May to determine if it will move on to the Senate Floor.
If the Bill passes, here is what will change:
- Until January 1, 2025, concrete contractors holding a C-8 license, HVAC contractors holding a C-20 license and tree service contractors holding a D-49 license MUST obtain and maintain workers’ compensation insurance even if the contractor has no employees.
- Beginning January 1, 2025, all licensed contractors or applicants for a license must obtain and maintain workers’ compensation.
- Beginning January 1, 2025, the CSLB will no longer accept workers’ compensation exemptions.
- The CSLB registrar may remove a concrete, HVAC, or tree servicer classification from an active licenser until receipt of a valid Certificate of Workers’ Compensation Insurance.
- The CSLB registrar may suspend active licenses with a concrete, HVAC, or tree servicer classification if that licensee is found to have employees and is lacking a valid Certificate of Workers’ Compensation Insurance.
What contractors should take away from the amendments is that beginning January 1, 2025, those looking to conduct business in California must have workers’ compensation coverage. There will be no exemptions and no way around it. California contractors that already have workers’ compensation coverage are not affected by the amendments.
The bill is sponsored by the CSLB. “Construction is one of the most dangerous occupations,” said David De La Torre, chair of the CSLB, “and the CSLB supports this effort to ensure California’s construction employers have workers’ compensation insurance on file to protect employees who are injured on the job and project owners and homeowners from worker injury claims.”
For information on workers’ compensation coverage and costs, visit: https://www.ccisbonds.com/contractor-workers-comp/