Home>Levelset Community>Legal Help>Can I hire my own workers for a $10,000 remodel and then just pay my friend a smaller fee for using his contractor's license on work in California?
Can I hire my own workers for a $10,000 remodel and then just pay my friend a smaller fee for using his contractor's license on work in California?
Remodeling mobile home - fixed in park in California.
1 reply
Jun 5, 2019
That's an interesting question, and the answer will depend on a number of variables. Let's sort through some of the more important topics. If you have additional questions that I don't touch on, feel free to come back and post another question!
Owner-Builders in California
If you are the owner of the property that will be improved, the licensing rules are tweaked a bit if you would also act as your own general contractor (i.e., if acting as an owner-builder). In California, property owners are entitled to act as their own general contractor and can directly hire "subs" and/or tradesmen to perform work. Of course, those subs and tradesmen would still need to be licensed, as required. For more information on California's owner-builder licensing requirements, this resource will be valuable: CSLB Owner-Builder Overview.
Working Under Someone Else's License
For contractors or businesses who are looking to take on a job that requires licensure, using another contractor's license in lieu of getting your own license could create liability for everyone involved. When a contractor "lends" their license to someone else so that they may take on work requiring licensure, this is generally called "renting" a license - and both the contractor renting their license and the party who rented their license could be on the hook for fines, damages, and potentially even criminal penalties. Of course, if the licensed party is actually performing some function on the job site, such as overseeing the work or coordinating the work, then such an arrangement might not be out of line with the CSLB's licensing rules. For more on what constitutes license renting and potential penalties: Renting Your California Contractor’s License. Probably Not Such a Good Idea.
Either way - it's generally a good idea to become familiar with California's licensing rules as well as what penalties might come into play if they aren't followed. For more information on that, this resource should be helpful: California Contractors License and the CSLB: Understanding the Rules.