{"id":244,"date":"2020-09-24T18:09:11","date_gmt":"2020-09-24T18:09:11","guid":{"rendered":"https:\/\/sites.sandiego.edu\/cpil-blog\/?p=244"},"modified":"2020-10-22T20:18:14","modified_gmt":"2020-10-22T20:18:14","slug":"contractors-state-license-board-moves-to-mandate-workers-compensation-insurance-for-its-licensees","status":"publish","type":"post","link":"https:\/\/sites.sandiego.edu\/cpil-blog\/2020\/09\/24\/contractors-state-license-board-moves-to-mandate-workers-compensation-insurance-for-its-licensees\/","title":{"rendered":"Contractors State License Board Moves to Mandate Workers\u2019 Compensation Insurance for Its Licensees"},"content":{"rendered":"<h3>By Sabrina Barr<\/h3>\n<p>At its September 9, 2020 <a href=\"https:\/\/www.youtube.com\/watch?v=SgL2ahUo1ME\">meeting<\/a>, the Contractors State License Board (CSLB) unanimously approved a <a href=\"https:\/\/www.cslb.ca.gov\/Resources\/BoardPackets\/2020\/BoardPacket09092020.pdf\">legislative proposal <\/a>[item E-3], recommended by CSLB staff and the Board\u2019s Workers\u2019 Compensation Advisory Committee, that would amend sections 7125 and 7125.4 of the Business and Professions Code to mandate workers\u2019 compensation insurance for all licensees of the Board over a prescribed time period. \u00a0Under current law, contractors who hire employees are legally required to obtain workers\u2019 compensation insurance, but contractors who work alone and do not hire employees can file an exemption. <a href=\"http:\/\/leginfo.ca.gov\/pub\/95-96\/bill\/asm\/ab_3351-3400\/ab_3355_cfa_960223_093126_sen_comm.html\">AB 3355 (Firestone) (Chapter 331, Statutes of 1996)<\/a>, which amended section 7125.4 of the Business and Professions Code, clarified that false exemptions can be a basis for disciplinary action, and not just automatic license suspension.<\/p>\n<p>According to the staff memo in the agenda materials, the falsification of these exemptions is a widespread issue among contractors. During the 2019\u20132020 fiscal year, the Board canceled 374 false workers\u2019 compensation exemptions; investigated 1,112 complaints; issued 38 letters of admonishment, and filed 326 complaints for legal action. The Board also performed 592 workers\u2019 compensation compliance investigations through its Statewide Investigative Fraud Team (SWIFT) unit, which resulted in 48 letters of admonishment and 329 administrative disciplinary actions.<\/p>\n<p>In presenting the proposal, staff reminded the Board that CSLB has worked to address this issue for years, beginning in 2017 when the Board established a small advisory committee to develop strategies to address workers\u2019 compensation insurance avoidance. As part of its 2018 <a href=\"https:\/\/perma.cc\/RWV2-LVKJ\">Sunset Review Report<\/a>, the Board identified the high number of workers\u2019 compensation exemptions (about 55 percent) as one of its \u201cnew issues\u201d for the legislature to address and consider in future legislation impacting the Board. In 2019 and 2020, the Board held various meetings to discuss solutions to this problem, including a meeting with the State Compensation Insurance Fund.<\/p>\n<p>Despite these efforts, staff reported that the number of workers\u2019 compensation exemptions on file has remained consistent. For this reason, CSLB\u2019s newly-approved legislative proposal seeks amendments to sections 7125 and 7125.4, of the Business and Professions Code, which would immediately require certain classes of contractors (C-8 concrete contractors, C-20 HVAC contractors, and D-49 tree service contractors) to obtain workers\u2019 compensation insurance, and within three years, would require workers\u2019 compensation insurance for every actively licensed contractor.<\/p>\n<p>While staff noted that the proposed legislative amendments could result in a loss of 10 percent of the given license population, and $356,625 annually in license renewal fees, in addition to $25.6 million in annual premiums paid by the licensees, the staff and the advisory committee recommended that the Board pursue such legislation in the 2021\u20132022 legislative session.<\/p>\n<a class=\"synved-social-button synved-social-button-follow synved-social-size-32 synved-social-resolution-single synved-social-provider-facebook nolightbox\" data-provider=\"facebook\" target=\"_blank\" rel=\"nofollow\" title=\"Follow us on Facebook\" href=\"https:\/\/www.facebook.com\/CPILUSD\" style=\"font-size: 0px;width:32px;height:32px;margin:0;margin-bottom:5px;margin-right:5px\"><img loading=\"lazy\" decoding=\"async\" alt=\"Facebook\" title=\"Follow us on Facebook\" class=\"synved-share-image synved-social-image synved-social-image-follow\" width=\"32\" height=\"32\" style=\"display: inline;width:32px;height:32px;margin: 0;padding: 0;border: none;box-shadow: none\" src=\"https:\/\/sites.sandiego.edu\/cpil-blog\/wp-content\/plugins\/social-media-feather\/synved-social\/addons\/extra-icons\/image\/social\/circle\/64x64\/facebook.png\" \/><\/a><a class=\"synved-social-button synved-social-button-follow synved-social-size-32 synved-social-resolution-single synved-social-provider-twitter nolightbox\" data-provider=\"twitter\" target=\"_blank\" rel=\"nofollow\" title=\"Follow us on Twitter\" href=\"https:\/\/twitter.com\/cpilusd\" style=\"font-size: 0px;width:32px;height:32px;margin:0;margin-bottom:5px\"><img loading=\"lazy\" decoding=\"async\" alt=\"twitter\" title=\"Follow us on Twitter\" class=\"synved-share-image synved-social-image synved-social-image-follow\" width=\"32\" height=\"32\" style=\"display: inline;width:32px;height:32px;margin: 0;padding: 0;border: none;box-shadow: none\" src=\"https:\/\/sites.sandiego.edu\/cpil-blog\/wp-content\/plugins\/social-media-feather\/synved-social\/addons\/extra-icons\/image\/social\/circle\/64x64\/twitter.png\" \/><\/a>","protected":false},"excerpt":{"rendered":"<p>By Sabrina Barr At its September 9, 2020 meeting, the Contractors State License Board (CSLB) unanimously approved a legislative proposal [item E-3], recommended by CSLB staff and the Board\u2019s Workers\u2019 Compensation Advisory Committee, that would amend sections 7125 and 7125.4 <a class=\"more-link\" href=\"https:\/\/sites.sandiego.edu\/cpil-blog\/2020\/09\/24\/contractors-state-license-board-moves-to-mandate-workers-compensation-insurance-for-its-licensees\/\">Continue reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":1013,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[132898,134396],"tags":[132903,132937,134398,134397],"coauthors":[132864],"class_list":["post-244","post","type-post","status-publish","format-standard","hentry","category-contractors-state-license-board","category-legislation-contractors-state-license-board","tag-cslb","tag-insurance","tag-licensees","tag-workers-comp"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - 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