California construction independent contractor agreement template
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How California construction independent contractor agreement Differ from Other States
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California applies the strict ABC test for independent contractor classification under Assembly Bill 5, unlike many states using less stringent standards.
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California mandates written agreements for most independent contractor relationships in construction, while other states may not require such documentation.
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California imposes specific penalties for misclassification, including back pay and fines, which can be more severe than in other states.
Frequently Asked Questions (FAQ)
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Q: Is a written independent contractor agreement required for construction in California?
A: Yes, California law generally requires a written contract for independent contractor arrangements in construction.
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Q: What is the ABC test for contractors in California?
A: The ABC test determines contractor status. It requires proof that the worker is independent, self-directed, and not part of the hiring entity’s usual business.
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Q: What are the consequences of misclassifying a construction worker in California?
A: Penalties include back wages, fines, tax liabilities, and potential lawsuits under California’s labor laws.
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California Construction Independent Contractor Agreement
This Construction Independent Contractor Agreement (the “Agreement”) is made and entered into as of this [Date], by and between [Client Name], residing at [Client Address] ("Client"), and [Contractor Name], residing at [Contractor Address] (“Contractor”).
WHEREAS, Client desires to have certain construction services performed; and
WHEREAS, Contractor is qualified to perform such services and desires to perform them as an independent contractor.
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties agree as follows:
1. Scope of Services
- Option A: The Contractor shall perform the following construction services: [Describe in detail the services to be provided, including specific tasks, materials, and desired outcomes. Reference any architectural plans or specifications. E.g., "Framing of a new 2-story residence according to blueprints dated [Date] by [Architect Name]."]
- Option B: The services to be provided are as detailed in Exhibit A, attached hereto and incorporated by reference.
- Option C: Provide [Specialty Trade] services as needed and requested by the client on the following project(s) [Project Name(s)].
2. Work Site
- Option A: The services shall be performed at the following location: [Property Address].
- Option B: The services shall be performed at various locations within [City, County], as directed by the Client.
The Client shall provide access to the worksite during reasonable hours. Contractor is responsible for verifying site conditions and notifying Client of any discrepancies.
Contractor shall adhere to all applicable site safety protocols, including Cal/OSHA regulations.
3. Project Schedule
- Option A: The project shall commence on [Start Date] and be completed by [Completion Date].
- Option B: The Contractor shall perform services on [Days of the Week], between the hours of [Start Time] and [End Time].
Any delays due to unforeseen circumstances or force majeure events will be subject to written agreement and may extend the completion date.
Contractor is responsible for providing a construction timeline at project start, identifying project milestones.
4. Compensation
- Option A: The Client shall pay the Contractor a lump sum of [Dollar Amount] for the completion of the services.
- Option B: The Client shall pay the Contractor at an hourly rate of [Dollar Amount] per hour.
- Option C: The Client shall pay the Contractor based on the following milestone schedule: [Describe milestones and corresponding payments].
Invoices shall be submitted [Frequency - e.g., weekly, bi-weekly, monthly].
Payment is due within [Number] days of invoice receipt.
Contractor shall provide a valid California contractor license number: [License Number].
Retention: [Specify whether a percentage will be retained, and the conditions for its release, in accordance with California law.]
Contractor is responsible for all applicable federal and state taxes as an independent contractor.
5. Insurance
Contractor shall maintain the following insurance coverage:
- General Liability Insurance: [Dollar Amount] per occurrence.
- Workers’ Compensation Insurance: (If Contractor employs others) As required by California law.
- Automobile Insurance: [Dollar Amount] (if applicable).
Client shall be named as an additional insured on the general liability policy. Contractor will supply client with Certificate of Insurance prior to work commencing.
6. Independent Contractor Status
The Contractor is an independent contractor and not an employee of the Client.
The Contractor is responsible for all self-employment taxes, unemployment insurance, and other statutory contributions.
The Contractor is not entitled to any employee benefits from the Client.
7. California State License Board (CSLB) License
Contractor represents and warrants that they hold all appropriate and valid California State License Board (CSLB) licenses for the work being contracted: [License Class].
Contractor's CSLB license number is [License Number].
Contractor must maintain their CSLB license in good standing throughout the duration of this agreement. Suspension or revocation of Contractor's license will be grounds for termination of this agreement.
8. Compliance with Laws
Contractor shall comply with all applicable California state and local codes, regulations, ordinances, and environmental standards.
If the project involves public works, Contractor shall comply with all prevailing wage requirements.
9. Subcontractors
The Contractor may engage subcontractors only with the prior written approval of the Client.
All subcontractors must be licensed and insured as required by California law.
Contractor is responsible for the actions and omissions of its subcontractors.
10. Permits and Inspections
- Option A: The Contractor is responsible for obtaining and paying for all necessary building permits and inspections.
- Option B: The Client is responsible for obtaining and paying for all necessary building permits and inspections.
Contractor shall ensure timely inspections and provide copies of all certifications to the Client.
11. Change Orders
Any changes to the scope of services or compensation must be documented in a written change order signed by both parties.
All change orders must comply with California law.
12. Lien Waivers and Releases
The Contractor shall provide lien waivers and releases from themselves, subcontractors, and suppliers upon payment, as required by California mechanics' lien laws.
Final payment will be contingent upon receipt of a final unconditional lien release.
13. Project Cleanup
The Contractor shall be responsible for project cleanup, debris removal, and safe disposal of construction waste in accordance with CalRecycle and regional environmental laws.
14. Warranty
The Contractor warrants their workmanship and materials for a period of [Number] year(s) from the date of completion.
This warranty is subject to the California Right to Repair Act. [Describe the scope of the warranty and the process for warranty claims.]
15. Confidentiality
The Contractor shall maintain the confidentiality of the Client's property, plans, and project details.
16. Termination and Suspension
This Agreement may be terminated by either party upon [Number] days written notice.
The Agreement may be terminated immediately for material breach, including but not limited to:
- Defective work.
- Safety violations.
- Failure to maintain licenses or insurance.
Upon termination, the Contractor shall provide a final accounting and handover of incomplete work and materials.
17. Indemnification
The Contractor shall indemnify and hold harmless the Client from any and all claims, damages, liabilities, costs, and expenses arising out of or relating to the Contractor's performance of the services. To the extent permitted by California law.
18. Delivery and Acceptance
Upon completion of the services, the Client shall conduct a final inspection.
Any defects shall be noted in a punch list.
Substantial completion shall be defined as [Define substantial completion].
Final completion shall be defined as [Define final completion].
19. Dispute Resolution
Any disputes arising out of or relating to this Agreement shall be resolved through:
- Good faith negotiation.
- Mediation.
- Option A: Binding arbitration in [County Name] County, California.
- Option B: Litigation in the courts of [County Name] County, California.
California law shall govern this Agreement.
[Specify terms for attorney fees]
20. Fair Employment and Housing Act Compliance
The Contractor shall comply with the California Fair Employment and Housing Act.
The Contractor shall post all required notices regarding anti-harassment, wage theft, or workers’ rights, if applicable.
21. Right to Work and E-Verify
The Contractor shall provide proof of their legal right to work in the United States.
If applicable, the Contractor shall comply with E-Verify requirements.
22. Notices
All notices under this Agreement shall be in writing and delivered by:
- Personal delivery.
- Registered mail.
Notices shall be sent to the addresses listed above.
23. Severability
If any provision of this Agreement is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect.
24. Amendment
This Agreement may be amended only by a written instrument signed by both parties.
25. Record-Keeping and Audit Rights
Contractor shall maintain accurate financial and project records for a period of [Number] years.
Client shall have the right to audit such records upon reasonable notice.
26. Special Requirements
[List any special client requirements unique to the property or project, such as historical property restrictions, HOA approvals, or environmental impact reporting requirements.]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
[Client Name]
By: [Client Signature]
[Contractor Name]
By: [Contractor Signature]