Butte County in California is targeting contractors who operate without workers' compensation insurance by demanding proof of insurance prior to issuing permits.
This is a pilot program the county is rolling out and will initially apply only to roofing and swimming pool contractors, until the county understands the labor and operational requirements to make the program applicable to all contractors.
Butte County is ahead of the state government, which is considering a bill that would require proof of insurance before a contractor can renew its licence with the Contractors State Licensing Board. AB 397 by Assemblyman Bill Monning, D-Carmel, would require contractors to show proof of comp coverage or exempt status when renewing licenses before the State Contractor Licensing Board.
The bill is up for a third and final reading in the Senate.
Contractors have a notorious reputation for failing to either carry any workers' compensation insurance, or grossly underreporting payroll, claiming independent contractor status of workers that otherwise would be considered employees for work comp insurance purposes.
AB 397 is a good step in the right direction, but would be more effective if it also provided that a contractor's license could not be renewed if there was proof that the contractor was engaged in either underreporting payroll or misrepresenting its payroll.
On another note, pending before the California legislature is SB 432, introduced by Sen. Kevin DeLeon, D-Los Angeles, that would mandate hoteliers use fitted sheets and provide long handled tools to housekeeper employees.
The hotel industry opposes the bill because of expense and the intrusion of greater regulation, stating that there is no evidence that providing fitted sheets would prevent injuries. Unions and the California Applicant Attorneys Association support the bill, stating that it would reduce injuries to housekeepers.
In general I'm opposed to increased regulation on businesses that otherwise operate in an ethical and sensitive manner.
On the other hand, as a frequent hotel guest, I HATE flat sheets! They always come undone from under the mattress, bunch up, and make for an uncomfortable night of sleep.
I wouldn't mind paying a couple extra dollars (make it $5) to get a fitted sheet for a night of good sleep. Can't there be some middle ground?
I think requiring proof of insurance to pull a permit is the best way to solve the uninsured contractor issue. If the Contractor cannot get a permit, he cannot get many decent projects. If all the cities required proof of insurance before pulling a permit, UEF Contractor cases would drop SIGNIFICANTLY. I am surprised that insurance has not already been uniformly required by cities/counties for a Permit.
ReplyDeleteUnder-reporting income/payroll has been a problem since taxes were invented. That solution is 10x harder, and I wish I had a workable answer.
Thanks for the comment WCABDEFENSE - you make a very good point. Proof of insurance at the permit pulling stage is going to get a lot of contractors to at least buy SOME insurance. They may underreport, but at least employees will be covered. It will be up to the carriers to go after the underreporting employer to recoup premium,
ReplyDeleteThank you for sharing such great information.
ReplyDeleteIt has help me in finding out more detail about fitted bed sheets