Do California contractors need workers' compensation insurance?
Any California contractor with employees must carry workers' compensation insurance. A contractor with no employees can usually file a CSLB exemption instead, but five classifications must carry coverage even with zero employees: C-8 concrete, C-20 HVAC, C-22 asbestos abatement, C-39 roofing, and C-61/D-49 tree service. From January 1, 2028, every active licensee will need coverage regardless of classification under Senate Bill 1455.
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Summary — key takeaways
- Contractors with employees must carry workers' comp; it shows on the CSLB license record (B&P §7125).
- C-8, C-20, C-22, C-39, and C-61/D-49 licensees need coverage even with no employees; an exemption is not an option for them.
- From January 1, 2028, workers' comp is required for every licensee regardless of classification (SB 1455).
- Since January 1, 2026, employing workers without coverage draws minimum penalties: $10,000 per violation for sole owners, $20,000 for companies (SB 291).
- If an uninsured worker is hurt on your property, you could be asked to pay through your homeowner's policy or face a lawsuit.
The baseline workers' comp rule
The baseline, under Business & Professions Code §7125: a licensee with employees must have a workers' compensation policy (or a valid certification of self-insurance) on file with CSLB, and a licensee with no employees may file an exemption certifying that, signed under penalty of perjury. The exemption becomes invalid the moment the contractor hires anyone, and CSLB is required to have a process for verifying exemption claims, which may include audits or proof requirements, in place by January 1, 2027. The license record shows which applies, and each profile here reflects it.
Trades that must carry it regardless of employees
Five classifications cannot claim the exemption and must carry workers' compensation (or valid self-insurance) even with zero employees: C-8 concrete, C-20 HVAC, C-22 asbestos abatement, C-39 roofing, and C-61/D-49 tree service. C-39 roofing was subject to this rule before the others; Senate Bill 216 added the remaining four effective January 1, 2023.
One wrinkle for tree work: the statute names C-61/D-49 Tree Service, and C-49 Tree and Palm, the successor classification CSLB has issued since January 1, 2024, is not yet named in it, though CSLB regards the two as the same scope of work, and from January 1, 2028 every licensee needs coverage regardless. Whichever code your tree contractor holds, insist on seeing a current policy: for these high-risk trades, treat missing workers' comp as a stop sign.
The requirement expands to all contractors in 2028
Senate Bill 216 originally set the everyone-regardless-of-employees rule to start January 1, 2026, and Senate Bill 1455 moved it to January 1, 2028. From that date, a current workers' compensation policy or self-insurance certificate becomes a condition of getting, renewing, or keeping any active license. Until then, contractors outside the five listed classifications who genuinely have no employees may still operate under an exemption, so confirm which situation applies before hiring, especially for roofing, HVAC, concrete, asbestos, and tree work.
Penalties for skipping coverage tightened in 2026
Since January 1, 2026, Senate Bill 291 sets minimum penalties for licensees caught employing workers without workers' compensation: at least $10,000 per violation for a sole owner and at least $20,000 per violation for a partnership, corporation, or LLC. A licensee without current coverage also cannot renew or reinstate the license. For homeowners, the takeaway is simple: a contractor putting a crew on your project without coverage is risking five-figure penalties and the license itself, and some of the fallout can land on you.
Why it matters to you
If a worker is injured on your property and there's no workers' compensation policy behind them, you could be asked to pay for injuries and rehabilitation through your homeowner's insurance policy or face a lawsuit. Checking takes a minute: the license record shows either a policy (with the carrier and policy number) or an exemption. For the five no-exemption trades, accept nothing less than a current policy or self-insurance; for any other trade, an exemption is only plausible if the contractor genuinely works alone.
Frequently asked questions
Which California contractors must carry workers' comp even with no employees?
C-8 concrete, C-20 HVAC, C-22 asbestos abatement, C-39 roofing, and C-61/D-49 tree service licensees; the exemption is not available to them. C-39 was subject before the others, which Senate Bill 216 added effective January 1, 2023. From January 1, 2028, the rule extends to every classification.
Can a contractor be exempt from workers' compensation?
Yes, for now. A licensee with no employees can file a CSLB exemption, unless they hold one of the five no-exemption classifications (C-8, C-20, C-22, C-39, or C-61/D-49). The exemption is signed under penalty of perjury and becomes invalid the moment they hire anyone. The option disappears for everyone on January 1, 2028.
Do C-49 tree and palm contractors need workers' comp?
The no-exemption statute names C-61/D-49 Tree Service; C-49 Tree and Palm, the successor classification issued since January 1, 2024, is not yet named in it, though CSLB regards the two as the same scope of work. Given that, and the risk of tree work, insist on a current workers' comp policy from any tree contractor. From January 1, 2028, every licensee needs coverage anyway.
What happens to a contractor who has workers but no workers' comp?
Since January 1, 2026, minimum penalties apply under Senate Bill 291: at least $10,000 per violation for a sole owner and at least $20,000 per violation for a partnership, corporation, or LLC. The license also cannot be renewed or reinstated without current coverage, and it can be suspended.
Why does a contractor's workers' comp matter to me?
If a worker is injured on your property and the contractor has no coverage, you could be asked to pay for injuries through your homeowner's insurance policy or face a lawsuit. Confirming workers' compensation protects you, not just the crew.
How do I check if a contractor has workers' comp?
Open the license on CSLB's Check a License tool or the contractor's profile here. The record shows either a workers' compensation policy (carrier, policy number, dates) or an exemption. If it shows an exemption but a multi-person crew turns up for the job, that's a red flag: the exemption is only valid with no employees.
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