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CA Governor OKs Contractor Reporting Law

Tuesday, September 20, 2016

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California Gov. Jerry Brown has signed legislation that will provide the state’s Contractors State License Board with more information about contractors, and require contractors to report any work-related convictions to the board.

The bill, introduced in the wake of a fatal balcony collapse in Berkeley in 2015, also calls for research into building code changes, and whether the state should require contractors to report financial settlements in addition to convictions.

Self-Reporting Convictions

Beginning on January 1, 2017, contractors will be required to report to the CSLB within 90 days any criminal convictions “substantially related” to their work. According to reports, contractors licensed before 2006 were never required to report convictions; new since 2006 have required a criminal background check.

Califonia capitol
By David Monniaux, CC-BY-SA-3.0, via Wikimedia Commons

The measures in the bill, which passed both chambers of the California state legislature unanimously, are in direct response to the June 2015 balcony collapse in Berkeley that killed six students.

In addition to the self-reporting element, two regulating bodies—the California Department of Industrial Relations and the Division of Occupational Safety and Health—will be required to report to the CSLB any enforcement action against any licensed contractors. The Department of Industrial Relations regulates labor-related issues, including wages and sick leave; OSH is the state’s worker-safety body.

The CSLB, a division of the California Department of Consumer Affairs, licenses and regulates the state's approximately 300,000 contractors across the construction industry, from building and engineering to painting, concrete, roofing, road work and pipeline work.

Study on Settlements

Beyond the changes in reporting standards going into effect in January, the new law also sanctions a study into whether contractors should be required to report to the CSLB any and all financial settlements related to their defective work.

This section of the bill has proven controversial, with industry groups arguing that settlements are often made to avoid costly legal battles, and aren’t an admission of guilt on the part of a contractor.

Gov. Jerry Brown
California Governor's Office

Gov. Jerry Brown signed the bill, which will require contractors to report any work-related convictions to California's licensing board.

The bill notes that the study must take into account “criteria used by insurers or others to differentiate between settlements that are for nuisance value and those that are not, whether settlement information or other information can help identify licensees who may be subject to an enforcement action,” and “whether reporting should be limited to settlements resulting from construction defects that resulted in death or injury.”

That study is to be completed by January 1, 2018.

The bill also calls for a study of current state building code related to exterior elevated elements, to determine whether changes to code are warranted. That study is also to be completed by January 1, 2018.

2015 Collapse

The measures in the bill, which passed both chambers of the state legislature unanimously, are in direct response to the June 2015 balcony collapse in Berkeley that killed six students. Investigators found that the balcony that fell had extensive dry rot; it was later determined that the wood had been waterproofed after it took on extensive moisture, leading to the rot.

Segue Construction, the general contractor on the job at the complex, called Library Gardens, had settled numerous suits over moisture intrusion over the years; the CSLB was reportedly unaware of the settlements because there is no mandate to report settlements related to construction defects.


Tagged categories: Building codes; Contractors; Contractors State License Board; Laws and litigation; Lawsuits; Licensing

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