Hiring a handyman can be tricky, particularly if they don't come recommended by someone the home or business owner knows. In the state of California, the terms handyman and contractor can be interchangeable. The state has specific rules on what contractors must do before working any job and what home and business owners should expect when seeking them out.
Differences Between Handyman and Contractor
While a person needs a diverse set of skills to become a handyman, there is no state licensing requirement. Typically, the kinds of jobs a handyman takes are smaller than those of a contractor. The larger a job is, the more likely it will require a specialist of some kind, like an electrician, and will involve a contractor.
The Golden State requires both experience and passing an exam for a contractor's license. If a job is over $500, it requires a license, under California law, and working with dangerous or specialized systems requires a license in every state. General contractors also serve as coordinators between other workers, while a handyman usually works smaller jobs independently or under a contractor.
What to Look for When Hiring a Contractor
Using a licensed contractor helps homeowners avoid issues associated with unlicensed operators, who can pose a safety or financial risk if their construction work is faulty or incomplete. Homeowners can contact the California Contractors State License Board (CSLB) to verify a license or call 800-321-2752.
The CSLB grants licenses to contractors in several classifications. These include general contracting, landscaping, painting, electrical, swimming pool, plumbing and many more. Most unlicensed operators do not perform the quality of work licensed individuals do.
Difference Between General and Specialty Contractor
General contractors typically oversee jobs and coordinate everyone involved, including licensed subcontractors specializing in just one area. For example, if a homeowner needs roofing or plumbing work done, they will hire someone specifically for those projects. Sometimes, general contractors can also perform these duties, but they must hold specialty licenses for certain work.
The only exception to this rule is when a project needs more than two types of work at once, and the general contractor oversees the whole project. For example, if a bathroom remodel involves electrical, plumbing and carpentry under a single "B" general building contractor, they can do all the work themselves or contract parts out to specialists.
Workers' Compensation and General Liability Insurance
California requires contractors with employees to have workers' compensation insurance. If a worker gets injured, and the contractor doesn't have insurance, the homeowner may be financially responsible for the injured person's care and rehabilitation. An insurance carrier can tell a homeowner if a contractor's workers' compensation will cover this possibility.
California does not require commercial general liability insurance. According to the CSLB, it protects against accident property damage and third-party bodily injury; however, it does not cover the work done by the contractor. If the contractor doesn't have general liability insurance, they must inform the business or homeowner by law.
Licensed contractors must also tell homeowners what insurance they do possess in their written contract. Additionally, C-39 roofing contractors must show that workers' compensation insurance or a valid certificate of self-insurance is on file with CSLB.
Licensed Contractor Bonds
Licensed contractors in California must have contractor bonds. These protect the business or homeowner against low-quality work that isn't up to code, but they do not ensure the integrity or professionalism of a contractor. Lenders like banks, insurance companies, and savings and loans typically require a licensed contractor to secure a bond.
The three different types of bonds are:
- Contractor license bond: Must be for $15,000 and covers any project the licensed contractor will perform. However, it is sometimes not enough to cover multiple complaints against a contractor or when the job is worth more than the bond itself.
- Contract bond: This guarantees the job's completion and labor and material payment. Its cost is usually up to 2 percent of the contract price. The bonding company will not pay more than the bond's face value.
- Blanket performance and payment bond: In California, a contractor cannot ask for more than 10 percent of the contract price or $1,000 (whichever is less) as a down payment on a project unless they secure this bond and the CSLB has it on file. This bond covers all contracts a contractor has open at the same time. High-volume companies typically use this bond.
Penalties for Unlicensed Contractors
The CSLB has a Statewide Investigative Fraud Team (SWIFT), which frequently conducts undercover sweeps of construction sites around the state to make sure contractors are following the law. A contractor without a license faces a misdemeanor charge, which can carry up to six months in jail, a $5,000 fine, or both, and an additional administrative fine of up to $15,000. A second offense carries a mandatory 90 days in jail and a penalty of 20 percent of the contract cost or $5,000.
If someone uses another person's contractor's license, they can face felony charges, as can those who intentionally mislead potential clients into believing that they work as a licensed contractor when they do not. A person who takes work in a state or federal natural disaster location without a contractor's license also faces a felony charge. Felonies carry time in state prison.
Reporting an Unlicensed Contractor
Unlicensed contractors are not only dangerous, they sometimes do not pay taxes or carry the necessary insurance or bonds. Sometimes they may be involved in other illegal activities. Those who have a contract with an unlicensed contractor can file a complaint on the CSLB's website using its SWIFT Lead Referral form. After completing the form, the person filing the complaint sends it to the appropriate SWIFT office. Home and business owners can find the SWIFT office in the county where the illegal activity occurred on the CSLB's website. They can also send the form by fax or regular mail.
When filing a complaint, it is important to provide complete and detailed information about the illegal activity taking place on the job site, including information about the employees and possible photos. SWIFT offices process complaints according to the date they arrive, priority and the availability of staff. The department will assign an enforcement representative to the complaint who will follow up with any progress or ask for more information.
Homeowners can use the CSLB's Building Permit Violation Referral form to report a contractor who does not have a project building permit on a job site. They can email the completed form to the county SWIFT office where the job is or send it via fax or regular mail.
Contractor Advertising Requirements
A contractor can advertise their business in one of several ways – through newspapers, radio, vehicle lettering, the yellow pages, brochures or through websites or social media. Their contractor's license number has to be included on all advertisements, as well as construction contracts, subcontracts and bids. Contractors who do not comply with these requirements face a $100 to $1,000 fine for the first offense.
How an advertisement must appear on a business vehicle is also very specific. For example, C-36 plumbing, C-45 sign, and C-57 well drilling contractors must show the name of their business, their address and the contractor's license number on all sides of their commercial vehicle in lettering that is a minimum of 1 and ½ inches high. All other contractors must show their business name and contractor license number on their commercial vehicles in a visible area in a print type that is a minimum 72-point font with letters that are at least ¾ of an inch high and wide.
Handyman or Contractor Shopping
Home and business owners should get at least three written bids for a project and compare them based on the same plan, specifications and scope. They should not just take the lowest bid. In fact, low bids can be a red flag, especially if it is significantly lower than the other two. That can indicate that the contractor is cutting corners, will do substandard work or has not included everything about the project the home or business owner needs to know.
Home and business owners should consult with friends, family or other associates who had similar projects and ask who they used. Financial institutions, material suppliers and subcontractors are also good sources for reputable contractors and handymen, as are local building departments, unions, trade associations, consumer protection and fraud agencies, and the local Better Business Bureau.
Meeting With a Contractor or Handyman
If the job is less than $500 or is something simple, like replacing a window, the handyman won't need a California contractor's license, but the home or business owner should ask to see a photo ID to make sure they are who they say they are, and if they do have a license, make sure the photo ID matches it. Contractors also hire salespeople, who must show registration with the CSLB as a home improvement salesperson as well as a photo I.D. when meeting with a customer.
Contractors must show their license number on all business cards and contracts, but seeing a number doesn't necessarily mean it's valid. Therefore, it is important to verify the number with the CSLB.
Verifying Contact Information
Anyone entering into a business relationship with a contractor or handyman should make sure the person has a current phone number and business address. Someone who does not have either may be impossible to track down if something goes wrong after the job ends. The CSLB will also have an address of record for contractors with their license status.
If a person is not a state-licensed contractor, the customer does not have to legally pay them, and the contractor cannot sue them for nonpayment. The CSLB offers tools for both parties to resolve their disagreements, which can include offers of onsite mediation, negotiation and arbitration free of charge.
Both contractors and consumers can the use the CSLB’s call center's automated system anytime or speak to live technicians, Monday through Friday between 8:00 a.m. and 5:00 p.m. Peak waiting times occur between 1:00 p.m. and 3:00 p.m. so the agency recommends calling during off-peak hours, using the automated phone system or by making contract through the website.
- California Contractors State License Board: Fast Facts
- California Contractors State License Board: Check a Contractor License or Home Improvement Salesperson (HIS) Registration
- California Contractors State License Board: SWIFT Lead Referral Form
- California Contractors State License Board: How do I Find the Right Licensed Contractor?
- California Contractors State License Board: Consequences of Contracting Without a License
- California Contractors State License Board: Building Permit Violation Referral
- Next Insurance: Handyman vs. General Contractor: What’s the Difference?
- California Contractors State License Board: What Kind of Contractor Do You Need?
- California Contractors State License Board: Bond Requirements
- California Contractors State License Board:Information About Commercial General Liability Insurance
Michelle Nati is an associate editor and writer who has reported on legal, criminal and government news for PasadenaNow.com and Complex Media. She holds a B.A. in Communications and English from Niagara University.