Legal Question in Construction Law in California

First, a general contractor may be allowed to handle an entire job when it calls for two or more specialties. The following is quoted from the CSLB Web site:

"General building contractors usually oversee projects and coordinate the specific licensed subcontractors for a job. Specialty or subcontractors are usually hired to perform a single job. For example, if you want only roofing or plumbing work, you may want to hire a contractor licensed in that particular specialty.

"A general building contractor may also contract for specialty work, but must hold a specialty license for that work or actually have a specialty contractor do the work. The only exception is if the job requires more than two types of work on a building. Then it is appropriate for a licensed general building contractor to contract for and oversee the entire project. For example, if your kitchen remodeling will involve plumbing, electrical and carpentry work under one contract, you should hire a licensed general building contractor. Under these circumstances, a general building contractor may perform all of the work on a building, or subcontract parts of the job to contractors with specialty licenses."

Whether you or the contractor would win on this issue would be pretty fact-specific and I could not predict the outcome in court without more information, but I'd lean more toward the contractor being OK because of the somewhat mixed nature of the work, even if the flooring part predominated.

It makes a big difference whether the person who did the actual work was a bona fide employee or a subcontractor. A contractor may hire unlicensed employees to do the work, but must supervise the work in some detail. A contractor may not subcontract to an unlicensed person who is not a true employee.

The answer depends on the rest of the project and the arrangement with the unlicensed worker. A General Building Contractor is not allowed to contract for a project unless it requires at least two unrelated trades (meaning requiring different subcontractor licenses), or three unrelated trades if one of the trades is framing and carpentry, or only requires framing and carpentry. If the project fits those parameters, however, the contractor may do all or any part of the work with their own forces. They do not have to subcontract anything. So the first question is whether the contract met that requirment. If not, it was illegal in its entirety.

If the contract was one allowed to be taken by a General Building Contractor, then the relationship between the contractor and the installer becomes relevant. The general contractor can do any of the work with their own "forces." That means their own employees. So if the installer was hired as an employee of the general contractor, it was legal to use unlicensed personnel. If, however, the contractor did not put the installer on payroll, pay payroll taxes, etc., then it was illegal and both the contractor and the installer are subject to punishment by the CSLB and the courts for unlicensed contracting.