Administrative ProvisionsSubletting and Subcontracting
Section § 4100
This law is known as the "Subletting and Subcontracting Fair Practices Act." It establishes fair practices for subcontracting and subletting in construction and other applicable contracts.
Section § 4101
The California Legislature highlights the negative effects of bid shopping and bid peddling in public construction projects. These practices can lead to inferior work and materials, unfair competition, and financial problems such as businesses going bankrupt and workers losing wages.
Section § 4103
This law ensures that subcontractors and public entities like the state or counties still retain their rights to pursue actions against the main contractor if needed. These rights include any legal or fair solutions available, such as the state's ability to take over and finish a project themselves.
Section § 4104
This law requires that when bids are taken for public works construction projects, the specifications must include a requirement that the bidder lists details about any subcontractors. These details include the subcontractor's name, business location, California contractor license number, and public works contractor registration number if they perform work costing over a certain amount. An error in listing license numbers can be corrected within 24 hours, and additional information about subcontractors can be submitted after the bid deadline as allowed by the governing body. The bidder must also specify which part of the work each subcontractor will handle.
Section § 4104.5
This California law section explains the procedure for handling bids on public construction projects. When taking bids, the relevant government authority must specify where and when bids should be submitted. If there are any significant changes to the bid invitation within 72 hours of the deadline, the deadline must be extended by at least 72 hours. Any bids received after the deadline or extended deadline must be returned unopened. A 'material change' is defined as one that significantly affects the cost of the project, and a 'bid invitation' includes documents detailing the project and how to submit a bid.
Section § 4105
This law states that if a general contractor tries to bypass the rule requiring them to list their subcontractors by listing another contractor who then subcontracts most of the work, it is considered a violation. This action will result in penalties for the main contractor as specified in other sections.
Section § 4106
This section states that if a prime contractor doesn't name a subcontractor or names more than one for the same work that’s more than 0.5% of the total bid, the contractor must do the work themselves. If they later subcontract this work, without exceptions found in Sections 4107 or 4109, they will face penalties outlined in Section 4111.
Section § 4107
If a contractor wins a bid, they must stick to using the subcontractors they listed initially. However, they can switch subcontractors in certain cases, like if the original subcontractor can't meet their contract terms, is bankrupt, fails to perform, can't meet bond requirements, or was listed by a mistake. If problems like unlicensed work, poor performance, or delay arise, or if the subcontractor is ineligible for public projects, substitutions might be accepted. Before any switch, the subcontractor will get a written notice and a chance to object. If objections are raised, a hearing will be provided. Also, a subcontract can't be handed over to someone else without approval, and the contractor can’t subcontract work beyond a small portion unless noted in the original bid.
Section § 4107.2
If a prime contractor lists a subcontractor to do carpeting work, that subcontractor can't give any part of the labor to someone else unless they mentioned that person in their original bid to the prime contractor.
Section § 4107.5
California law requires a prime contractor to notify the awarding authority and any relevant subcontractors within two days if there's a claimed clerical error in naming a subcontractor in a bid. If a subcontractor receives this notice, they have six days to object in writing. If they don't, it suggests agreement that the error was accidental.
The awarding authority typically allows changes if affidavits are submitted within eight days by all involved parties substantiating the error. If objections are raised by the wrongly listed subcontractor, the authority will hold a public hearing to assess the situation using evidence and testimonies. The decision will be made based on declarations under penalty of perjury, and further testimonies can be considered if helpful.
Section § 4107.7
This section says that if a contractor working with the government on hazardous materials or waste cleanup doesn't pay their subcontractor (who is registered as a hazardous waste hauler) within 10 days after finishing the job, the unpaid subcontractor can issue a stop notice to the government. This is a legal way for the subcontractor to seek the money they're owed.
Section § 4108
This law requires subcontractors, when bidding to a prime contractor, to be ready to provide a performance and payment bond if the prime contractor requests it. This bond ensures the subcontractor will complete their work and pay for all labor and materials. If a subcontractor doesn't provide the bond when asked, the prime contractor can reject their bid and choose another subcontractor.
The prime contractor must clearly state the bond amount and requirements in their written or published request for subbids. If the subcontractor has to pay for the bond, this also must be noted. If the prime contractor doesn't specify these details initially, they can't later require the bond.
Section § 4109
This law states that a prime contractor cannot sublet or subcontract more than 0.5% of their total bid to any subcontractor not named in the original bid. This can only happen in cases of public emergencies or necessity, which must be documented in writing by the awarding authority explaining the situation.
Section § 4110
If a main contractor breaks any rules from this chapter, they can face consequences. The authority in charge can either cancel their contract or fine them. The penalty can be up to 10% of the subcontract's value and goes back into the funding source. The contractor has a right to a public hearing, and they must be notified about it five days in advance.
Section § 4111
If a contractor, who is licensed under specific construction laws, breaks the rules of this chapter, they can face disciplinary action by the Contractors State License Board. This is on top of any other penalties already mentioned in another section.
Section § 4112
If a contractor breaks rules from this chapter, they can't use that mistake as an excuse in a legal case brought by a subcontractor against them.
Section § 4113
This law defines two key terms in the context of construction projects. A "subcontractor" is a contractor who makes a direct agreement with the main contractor, known as the "prime contractor." Meanwhile, the "prime contractor" is the contractor who enters into a contract directly with the government or primary organization responsible for the project.
Section § 4114
This law allows a county board of supervisors to assign its duties related to certain procedures (under Sections 4107 and 4110) to an officer it chooses. Once the officer makes a recommendation, the board can either accept it right away or decide to hold a new hearing on the matter.