New Laws Affecting Your Business in 2012, part 2

The following is part two of my series regarding new laws that may affect how you do business starting January 1, 2012.  Let’s take a look, and discuss how these laws may impact you.

Apprenticeship and Certification

AB 554 amends section 14230 of the Unemployment Insurance Code, and directs the state and local Workforce Investment Boards to ensure that programs and services funded by the federal Work Investment Act of 1998 (WIA) are conducted in coordination with apprenticeship programs, and encourage collaboration between community colleges and apprenticeship programs.  Existing law contains various programs for job training and employment investment, including work incentive programs, in which states may participate.   This bill requires the California Workforce Investment Board (WIB) and each local board to ensure that programs and services funded by the WIA are directed to apprenticeable occupations, including preapprenticeship training, and are conducted in coordination with apprenticeship programs approved by the Division of Apprenticeship Standards for the occupation and geographic area.  The California WIB and local boards are required to develop a policy of fostering collaboration between community colleges and approved apprenticeship programs in their geographic areas. 

AB 1346 amends sections 3099 and 3099.2 of the Labor Code, making some non-substantive clarifications to existing law.  The change relates to reporting by applicants for electrician certification.  Under the existing certification process, an applicant must demonstrate at least four years of experience in the class for which he or she is applying in order to qualify to take the electrical certification examination.  Now, applicants must submit with their application an employment history report from the Social Security Administration (SSA).  Because employers are required to withhold a percentage of an employee’s paycheck and remit that amount to the Social Security Administration, an accurate and complete job history can be confirmed by report from SSA.

Contractor State License Board (CLSB)

AB 397 adds section 7125.5 to the Business & Professions Code, relating to workers’ compensation insurance.  Existing law requires private employers to secure its employees’ payment of compensation by obtaining and maintaining workers’ compensation insurance or to self-insure.  The CSLB requires every licensed contractor to have on file with it at all times a current and valid Certificate of Workers’ Compensation Insurance or Certificate of Self-Insurance, or a statement establishing the contractor is exempt because he or she has no employees.  This bill requires any contractor claiming exemption to recertify the exemption or provide a Certificate upon renewal. 

AB 878 amends section 7125 of the Business & Professions Code .  Under existing law, workers’ compensation insurers are required to report to the CSLB registrar specified information regarding a contractor’s workers’ compensation policy.  This bill now requires workers’ compensation insurers to report to the CSLB when it cancels a policy as a consequence of a premium audit or investigation, a material misrepresentation by the contractor that resulted in financial harm to the insurer, and when no reimbursement has been made by the contractor to the insurer.  The information provided is not subject to the California Public Records Act.  Willful and deliberate disregard or violation of workers’ compensation laws provide a basis for discipline by the CSLB.

SB 543 amends a multitude of provisions contained within the Business & Professions Code, but most significantly, extends the authority of the CSLB through January 1, 2016.

SB 392, which was passed in 2010, but becomes effective January 1, 2012, allows for a limited liability company (LLC) to provide contracting services.  Under existing law, an LLC was precluded from rendering professional services.  By amending pertinent provisions of the Business & Professions Code, and Corporations Code, an LLC may now render services pursuant to a license, and authorizes the CSLB to issue licenses to an LLC, provided it designates a Responsible Managing Member, Responsible Managing Officer or Responsible Managing Employee to qualify for that license.  The law requires a $100,000 surety bond arising out of specified claims of employees.  The bill also has very specific insurance requirements, and violation of certain portions of contractors’ license law by an LLC constitutes a crime.  If you are a contractor and are considering changing the form of your business to an LLC, please consult with a professional.

Questions?  Concerns about how this may impact your business?  Comment, or send me an email, and let’s discuss. 

Nothing in this blog is intended to create an attorney-client relationship.  This article is intended to provide a general overview of the current status of the law for informational purposes only, and is not intended to constitute, or serve as a substitute for, a professional legal consultation.  Laws change every day; please consult an attorney regarding the current status of the law, and how the law affects your specific circumstances. Thank you.