Officers, Members or Managers, oh my! Today I offer advice on ‘multiple’ licensing. I can only offer a referral, rather than a solution for another inquiry, and suggest that sometimes a qualifier can have it, and take it with them…

Q: Does a Sole Proprietorship Contractor need to carry Worker’s Compensation Insurance?

A: The CSLB Worker’s comp requirements are the same regardless of the type of entity (Sole Prop, corporation, LLC). All “C-39”( Roofing), “C20” (HVAC), “C-8” (Concrete), “C-22” (Asbestos Abatement), and “D-49” (Tree Service) who hold an active contractor’s license are required to carry Workers Compensation Insurance regardless of whether they have employees. All other actively licensed contractors are required to carry Worker’s Comp if they employ workers.

Under a new rule, as of this January 1, CSLB will not process renewals for these licenses without proof of Worker’s Comp Insurance, regardless of having any employees.

Q: We have a tri-venture license with two other companies with current work going on. Our company is currently undergoing a consolidation and will be merged into another company and cease to exist as of January 1, 2023. We will be getting a new license for the new company. How will this affect our Joint Venture license? The Joint Venture doesn’t expire until August 2023.

A: When one of the entities of a Joint Venture ceases to exist, you are required to get a new Joint Venture license.

Q: I had a license awhile back that I let lapse when I went to work for a Company that was already licensed. It’s been expired for about 7 years. I have called the CSLB a couple of times to get information on reactivating the license. The first time I called I was told I would have sit for the exams again. The second time I called I asked the representative if there was any way I would be able to get the license back and not have to take the exams again. That person told me I could submit an application and include a letter requesting the license number be re-issued and also request to waive the exams based on my experience. Based on that information, I put together what I thought was a great letter/plea/request for my number back and to not have to sit for the exam. While I have been impatiently waiting for a response to my application, I found your website and thought I could ask you what you thought the outcome will be.

A: I looked up your license and because it has been expired for over five years, you will be required to take the exams again, however since your license was a Sole Proprietorship, you can ask for the number to be re-issued so that part of your request should be granted at least!

Q: I read in one of your articles that one of the conditions for a Qualifying party to qualify three licenses at the same time is for the majority of the personnel on the licenses to be the same. We have three companies within our organization that we want to license and utilize the same qualifying individual. All three companies are LLC’s with the same Holding Company as the sole Member. If we have the same Member for each of the three licensed entities, do we still need the Qualifier to be an officer? If so, does he need to be an officer of each of three licensed entities, or an officer of the Member?

A: If you want him to qualify all three, yes, he would need to be an officer of the three license holder entities, not just an officer of the Member. If it were only two licenses you were wanting him to qualify for, then he could an employee (RME). But since an RME/Employee is required to work a minimum of 32 hours a week, they don’t allow employees to qualify for 3 licenses because they know people aren’t working 96-hour weeks. Sometimes it just seems that long! 

Q: Is it possible for an individual that holds a GC license via a Sole Proprietor to also hold a second GC license for an LLC or corporation?

A: Yes. If the individual wants both the sole owner license and the Company license (corp or LLC) active, then he/she would need to own at least 20% of the Company they are qualifying for. If there is no ownership interest in the company, then he/she would be required to inactivate their Sole Owner license.

While knowledge is power, knowing where to go for the answers is half the battle. Get expert assistance immediately when you call 866-443-0657, email [email protected].

By Shauna Krause,  President, Capitol, Services, Inc-www.cutredtape.com