The California Contractors State License Board (CLSB) licenses contractors in the construction field. These contractors encounter many challenges as they strive to adhere to project plans and budgets, satisfy demanding clients, and retain skilled subcontractors and workers.

License holders may not always tell when they break the rules but require knowledgeable legal assistance when issues arise. You can contact us at the San Diego License Attorney in such situations. We have a wealth of experience defending license holders against claims related to licenses in administrative hearings.

An Overview of Contractors and General Contractors in California

The construction field generates about $1.3 trillion in structures annually and hires more than seven million people nationwide. It plays a vital role in the US economy. In California, there are over 300,000 certified contractors, and the state has seen many major construction projects, such as:

  • Hospitals
  • Sports and entertainment venues
  • Factories
  • Hotels

Construction contractors manage daily operations and large projects. Their work starts with reviewing project plans and includes overseeing the physical work. You do not need a college degree to be a specialty or general contractor. However, you need training and practical experience to obtain your professional license and build a thriving career.

A contractor is responsible for all parts of renovation or construction projects. They often employ subcontractors with specific skills and work directly with clients.

General contractors have several key responsibilities, like:

  • Securing building permits
  • Supplying necessary equipment, materials, services, and labor

In California, general contractors can work on various projects, including adding a second story to homes, parking lots, railroads, office buildings, excavations, and other structures. To operate as a general contractor, you need a state license from the licensing board for any project exceeding $500.

To qualify for a contractor license, you must have at least 4 years of journeyman experience in the last ten years, or you should have worked as a foreman or supervisor.

Before obtaining a professional license in California, you should pass law, business, and trade examinations. Your construction skills will determine eligibility for a general building contractor or general engineering license.

The different classes of the contractor and general contractor licenses include the following:

  • General engineering contractors in irrigation, grading, paving, excavation, and similar fields can qualify for Class A contractor licenses if they meet the necessary criteria.
  • Authorities grant Class B contractor licenses to building contractors focusing on building or renovating commercial and residential properties. Class B licensed contractors can oversee complete projects and hire subcontractors for specific tasks.
  • Class C is a separate contractor license for those specializing in a specific area. The 41 licenses in this category cover fields such as HVAC, electrical work, fencing, plumbing, drywall installation, and more.

The Goals and Responsibilities of the Contractors State License Board (CSLB)

The CSLB, established in 1929, is part of California’s Department of Consumer Affairs (DCA). The board enforces licensing rules, ensures professionals and businesses follow an ethical code of conduct, and supervises the construction sector. It also sets guidelines to protect clients from contractors who do not meet their professional and licensing standards.

The licensing board’s role is to ensure well-being, safety, and health in construction matters. To do this, the CSLB can start investigations based on complaints received. The board can apply suitable penalties if it finds a California contractor at fault.

The nature and seriousness of the claims often influence the level of punishment. Penalties can vary from warning letters to the revocation of a contractor’s license. Health and safety violation claims usually attract a lot of attention.

The licensing board’s main job is to keep contractors in check. The board does not aim to help builders or promote growth in construction. Its focus is overseeing contractors and safeguarding the public from damages due to unethical practices or financial loss by dishonest professionals.

Possible Complaints Made Against Contractors and General Contractors to the License Board

As a contractor, you should protect your qualifications due to the technical demands and effort you invest in your work. To keep your license valid, you should involve California’s Contractor State License Board if any complaints arise against you.

Responding promptly is crucial for determining the ideal way to address the complaint. It also allows your professional license attorney to prepare for any hearings, negotiations, or arbitration that could come up. Here are some potential accusations that can threaten your contractor’s professional license:

Perpetrating Fraud During Real Estate or Insurance Transactions

Fraudulent operations mean using false reports or pretending to be something you are not to gain money and other advantages illegally. Contractors or general contractors, can face accusations of fraud if they submit fake documents about the details and scale of your project to obtain benefits.

Fraud can also happen when you obtain insurance for a project, especially if you inflate your insurance rates without a valid reason. In that case, the customer can justifiably report you, leading to a review of your license.

Hiring Underqualified Employees

Employing unqualified workers may seem appealing due to their lower hourly rates than skilled construction workers. However, this approach can pose risks for everyone on the job site, as these inexperienced individuals may lack knowledge of the correct procedures. Consequently, if the licensing board becomes aware of your use of undertrained staff, they should review your license.

Working While Under the Influence of Alcohol or Drugs

Being under the influence of alcohol or drugs while working is both unethical and risky, especially for contractors who often find themselves in hazardous environments. This behavior can also put others at risk, mainly if you are using heavy machinery.

If your clients or co-workers notice your actions repeatedly, they may report you. The CSLB will then assess whether you require further medical assistance while deciding whether to keep your license.

Preparing for Your Contractor License Hearing With the CSLB

When the CSLB receives complaints about your behavior or profession as a general contractor, they can take different actions against you. First, they should investigate to confirm that the allegations fall under their authority and that there is enough evidence to proceed.

The main actions the contractor’s state licensing board might take in your case include the following:

  • Call For Negotiations

The main goal for the parties in a dispute is to find a solution, usually through negotiation. As a result, you might receive formal requests to discuss terms with the person who claims you cannot reach an agreement.

While negotiating, you have the right to have a lawyer to help you present your demands and find a settlement while considering the other person’s perspective. Your professional license lawyer can represent you fully in the negotiation if the other side wants to communicate through their attorney, ensuring a fair negotiation process.

  • Attend Arbitration Proceedings

The CSLB can call for arbitration hearings to resolve disputes. This approach helps if your contract has an arbitration clause with the other party. Arbitration proceedings are like court hearings and involve both the defendant and the person making the complaint. An arbitrator leads the hearing, reviews evidence, and gathers information from both sides before deciding.

You should have your licensed attorney with you during the arbitration. They will present your case and prepare defenses in advance, as the sessions require strong evidence. After both sides present their arguments, the arbitrator can decide if you are to blame and, if so, what remedies should be provided to the other party.

  • Formal Administrative Hearings

The California Contractors State License Board may require formal administrative hearings if alternative remedies do not work. In this case, you should appear before the licensing board and answer questions about your behavior and professional background related to the current allegations. It can be challenging to face the CSLB alone, as they hold the proceedings in a panel format.

To prepare, consider the kinds of questions you might encounter. Additionally, gather the evidence you plan to use to support your argument with the help of your professional license attorney. For example, if you deny being under the influence at work, consider taking alcohol and drug tests to back up your case and counter the accusations.

Although administrative hearings can be challenging, your professional license lawyer will assist you. They know how crucial it is for you to keep your contractor license and will provide thorough legal support until the hearing is over. After the hearing, you should wait for the board’s verdict on suspending, revoking, or referring your case for criminal prosecution.

Possible Results for A Contractor License Disciplinary Proceeding

Once the arbitration or license hearing ends, you must wait a few hours or days for the licensing board’s feedback. Their decision relies on analyzing facts, assessing risks, and considering evidence from the complainant.

The board will also review your explanations and defenses against the accusations to determine if you have a valid legal basis for your actions. Depending on the case’s outcome, you may encounter several possible results, such as:

Suspension of Your Contractor License

A license suspension order requires you to stop working as a general contractor or contractor for a set time. The CSLB can issue this order as a punishment when your situation involves serious problems that lead to significant losses or delays for your customers.

For example, violating contract terms or not following the necessary standards and work ethics can lead to a suspension, as these issues can affect a project you are managing.

While the board suspends your license, it may investigate further to check if you have violated other rules or contracts. If new details arise, the licensing board can review them and determine whether to extend the suspension or hold a hearing. They might increase your punishment based on the new information if they do.

Receiving a Warning Letter or Citation

Minor mistakes related to your misconduct can lead to a citation or a warning letter against you. This approach is one of the lighter consequences, as your actions likely did not result in significant losses or safety risks for others.

However, the citation is public, which could hinder a contractor’s business growth. Even though it is a milder penalty, having it on your record may lead to harsher penalties for future issues. Therefore, you should be more careful in your contractor work after receiving the citation.

A warning letter includes a written acknowledgment of the accusations and a serious reminder that similar actions could have serious consequences later. While it does not directly impact your performance as a general contractor, it stays on record with the board, increasing scrutiny of you.

License Revocation

A license revocation is a serious matter that results in a permanent ban from working as a general contractor or a contractor. When the board revokes your contractor’s license, it publicly declares that your qualifications are no longer valid.

This revocation can harm your situation, so you should challenge it and try to reinstate your license. With the assistance of a license defense attorney, you can contest the verdict and ask the board to reconsider, providing reasons for your case. Although reviewing the case may be complex, having a professional license lawyer will support you.

Mutual Agreement Between Parties

You can ask your professional license attorney to talk to the complainant about finding a different way to resolve the issue during the investigation. Even though the board has the complaint, they are willing to consider a settlement that both sides agree on.

However, the board can only accept this arrangement if the accusation does not involve a direct code violation related to contractors and general contractors. Allowing such contracts could lead to more breaches without consequences, so you should understand the details of the complaint against you before consenting to settle.

Criminal Penalties

Certain wrongdoings can lead to criminal charges in addition to a client reporting you to the CSLB. For example, you could face criminal penalties if you commit fraud that causes a client to lose money. As a result, the board might send your case to the court instead of revoking your contractor’s license.

If a criminal court judge finds you guilty, you could end up in state or county prison, depending on the severity of the charge. You may also have to pay fines and provide restitution to the victims.

Find a San Diego License Defense Attorney Near Me

If you are dealing with an accusation that could compel the CSLB to revoke or suspend your contractor license, you should contact a license defense lawyer as soon as possible. These attorneys understand contractor license laws and can help you keep your license and protect your reputation.

At San Diego License Attorney, our lawyers are skilled in creating strong defenses for our clients. We take an aggressive approach in defending against accusations and actions from state licensing boards. Additionally, we guide contractors on how to avoid future complaints and allegations from competitors or clients. For more details about your general contractor or contractor license case, call us at 858-665-2455 to talk to one of our license lawyers.