2021 California Construction Law Update
This Christmas looks to be a Blue Christmas as the nation grapples with rising infection, hospitalization and death rates due to COVID. But there’s always 2021 to look forward to, which, of course, also means new laws impacting the construction industry.
Due to COVID there were two unscheduled breaks during the second half of the 2019-2020 legislative session as legislators sheltered-in-place. As a result, there were fewer bills introduced and enacted than in previous legislative session. A total of 2,223 bills were introduced in 2020 compared to 2,625 bills in 2019, of which 428 bills made it to the Governor’s desk, and 372 were signed into law.
Among the bills signed into law were bills, unsurprisingly, related to COVID. In addition, the 2020 legislative session saw the passage of legislation creating a new licensing classification for residential renovation contractors, new laws expanding and clarifying when prevailing wages are required to be paid, and legislation extending the period during which seniors can cancel certain contracts.
AB 685 – Requires employers to provide written notice to employees who may have been exposed to COVID-19 at their worksite. The notice is required to include the same information as would be required in an incident report in a CalOSHA Form 300 injury and illness log unless the information is inapplicable or unknown to the employer. Also authorizes CalOSHA to restrict access to a place of employment, machine, device, apparatus, or equipment or any part thereof if, in the opinion of the division, it is in a dangerous condition.
SB 1159 – Establishes a disputable presumption that an employee who becomes ill or dies from COVID-19 contracted COVID-19 of the employee’s course of employment and is compensable as a workers’ compensation claim. This disputable presumption is to continue through January 1, 2023.
AB 2210 – Authorizes the Contractors State License Board (CSLB) to take disciplinary action against a licensed contractor for violations of tree worker safety regulations administered by the California Division of Occupational Safety and Health without regard to whether death or serious injury to an employee resulted from the violation. This bill also extends the time for the CSLB to bring disciplinary action against a licensed contractor for such violations from 180 days to 18 months.
SB 865 – Makes several administrative changes to the Dig Safe Act of 2016. In addition, beginning January 1, 2023, requires the all new subsurface installations, with the exception of oil and gas flow lines three inches or less in diameter located within the administrative boundaries of an oil field, be mapped using a geographic information system and that such information be maintained as a permanent record of the operator. Also requires operators to notify a regional notification center within 48 hours of discovering or causing damage to a subsurface installation.
SB 1189 – Creates a new “B-2” classification of contracting business called “residential remodeling contracting,” which is defined as projects that make improvements to, on, or in an existing residential wood frame structure that use at least three unrelated building trades or crafts for a single contract. The bill also includes in the definition of “home improvement” the reconstruction, restoration, or rebuilding of residential property damaged or destroyed by a disaster for which either the governor or president has declared a state of emergency. The bill also expands the type of contracting activity in a declared disaster zone for which a person without a contractor license can be prosecuted.
SB 1474 – Requires the CSLB to retroactively reinstate an expired contractor license if a completed license renewal application is received with the appropriate fees within 90 days of the license expiration date.
Public Works Projects
AB 2231 – Provides a safe harbor from the payment of prevailing wages if a public subsidy is both less than $600,000 and less than two percent (2%) of the total project cost. For single-family residential projects, provides a safe harbor from the payment of prevailing wages if a public subsidy is less than two percent (2%) of the total project cost. Applies to projects advertised for bid, or contracts awarded, on or after July 1, 2021.
AB 2311 – Requires public entities, when use of a skilled and trained workforce is required, to include in all bid documents and construction contracts a notice that the project is subject to skilled and trained workforce requirements.
AB 2765 – Requires the payment of prevailing wages for construction work done under private contract on a charter school if the project is paid in whole or in part with proceeds from a conduit revenue bond issued on or after January 1, 2021.
SB 588 – Permits state agencies, on contracts entered into on or after January 1, 2021, to withhold the lesser of $10,000 or the final payment owed to a prime contractor who fails to provide the required certification of amounts paid to a disabled veteran business enterprise when required to. A contractor so notified has fifteen (15) to thirty (30) days to provide such certification or it forfeits the withholding.
AB 1551 – Prohibits “prepayment penalties” in PACE assessment contracts and prohibits PACE assessments on properties with reverse mortgages. Also requires that the PACE Financing Estimate and Disclosure be provided to the homeowner in printed, paper form, unless the property owner signs a printed paper document opting out of a hard copy, in which event the property owner may receive the disclosure electronically.
AB 2471 – Extends the right to cancel contracts for persons 65 years of age or older from three business days to five business days for the following transactions: home solicitation contracts, home improvement contracts, Property Assessed Clean Energy (PACE) assessment contracts, service and repair contracts, and seminar sales contracts.
3 Responses to “2021 California Construction Law Update”
[…] we wrote about in our 2021 Construction Law Update, one of the new laws to take effect on January 1, 2021 was the enactment of SB 1189 which created […]
Re: SB 1474 – Requires the CSLB to retroactively reinstate an expired contractor license if a completed license renewal application is received with the appropriate fees within 90 days of the license expiration date.
Any thoughts about how this new revision might impact an unlicensed contractor Disgorgement Claim under Business Code 7031?
Hi Marty. Good question. SB 1474 doesn’t address what impact, if any, it has to Business and Professions Code section 7031. My guess though is that courts would likely find that Section 7031 does not apply if an expired contractor’s license is retroactively renewed. Thus, for those of us who practice construction law, a safe practice until this issue is addressed by the Courts of Appeal would be to add 90 days to the expiration date of a contractor’s license before knowing for sure whether a claim could be brought under Section 7031.