01/08/2025
As a property owner, you will most likely need help with a project in your home – either a voluntary project like a remodel, an addition, or upgrade, or an involuntary project; emergencies like fire, flood, or storm damage. Either way, the contractor you choose will make all the difference in the cost and quality of the work done in your home. In this article, I’ll suggest ways you can protect yourself, your home, and your wallet.
First – the difference between a handyman and a licensed contractor.
A licensed contractor has a valid license and a bond. You can easily verify this information on the CSLB (Contractors State License Board) website CSLB.ca.gov
A handyman will not have a license, bond, or workers comp. You'll have limited recourse with a handyman.
In the state of California, a handyman - by law - can only bid projects up to $600 (including both labor and material). No one can stop you from hiring a handyman for a project worth more than $600, but you will not have any consumer protection if things go sideways.
Here are some guidelines for hiring a licensed contractor for your project.
Decide the scope of work for your project and write it down. Give the same written scope to the contractors you invite to bid on your project. Ask for the bid by a specific date. That way, all your contractor’s bids will be “apples to apples” to make it easier for you to decide who to work with.
Ask your neighbors, family and friends if they have a referral for you. A personal referral is golden. After that, look online and read reviews. Invite contractors to your site and walk through the scope with them. Use this time to gauge if your communication styles align. Communication is essential for a smooth project, so if at this stage you are having trouble communicating or getting your estimate in a timely manner, this might be a red flag.
By law, your contractor must have his (or her) Contractor License number on all forms of advertising. This includes – business cards, website, truck signs, estimates and contracts. If the license number is missing, ask for it and confirm that the license is in good standing. You can easily check using the contractors license number, company name or company owners name.
Ask for a written estimate, not just an hourly rate. The CSLB looks down on estimates that are “Time and Material”. The homeowner may be shocked to find out a project that should take 20 hours may be inflated to 40 hours of labor if they (or their employees) do not work at a good pace. There's nothing more frustrating than agreeing to an hourly rate estimate and then watching employees checking their phones every 20 minutes. A written estimate for the entire project will protect you from this.
Once you’ve narrowed down your choices of contractors, there are a couple tasks to complete.
- Ask the contractors for a couple referrals from previous and similar projects. If contractors do great work and complete projects with happy clients, they will be happy to provide referrals for you.
- Confirm the contractor’s license and workers comp on the CSLB.ca.gov website
- Ask for a certificate of insurance. Any insured contractor will happily supply you with this information.
If your contractor does not carry workers compensation insurance because they have told the CSLB that they are "exempt" because they do not have employees, watch out! If an employee is injured on your project and the contractor does not provide workers comp, you as the homeowner will be responsible to pay the medical and missed wages.
What to look for in your written contract:
When you have chosen the one contractor you want to work with, ask for the written contract which you will both sign. The Contractors State License Board (CSLB.ca.gov) is a consumer protection agency. It is not for the protection of contractors. They set the rules for contractors to follow.
Your contract deposit is limited.
Do not pay a hefty deposit up front, it’s not legal. The law for the deposit is that it can be 10% of the contract price or $1,000 whichever is less. After the project starts, the contractor may ask for an additional material deposit to order material, such as cabinets or flooring.
Your contract must have a start date and estimated completion date. Once you’ve signed the contract and paid the deposit, you need to know in writing when your project will start. Your contractor should follow up with you, so if you do not hear from him or her, as the date approaches, reach out to make sure you are still on track with your schedule.
Another contract essential is the payment schedule. The payments should roughly follow the percentage of the job completion at that stage. For instance, once the demo is complete, your contractor may ask for a payment. Make sure that payment is not a much larger percentage of the work being done. This should be spelled out for you in easy to understand terms.
At this point, chances are good that your project will go well and you’ll be happy with the results. But if you run into issues that you are unable to solve between you and your contractor, the Contractors State License Board at CLSB.ca.gov will provide guidelines to solving jobsite concerns. They are there to protect the homeowner.
