Pay to Play – Contractors Must Pay in Order to Perform Public Works
Effective March 1, 2015, Contractors must pay $300 per year in order to qualify to work on public projects. Contractors must register on the Department of Industrial Relations (“DIR”) website and pay the fee. If a contractor fails to register, it cannot perform work on a public project. For the bottom line, jump to the end of the article.
Effective January 1, 2015, calls for bids and all contract documents must include the following:
No contractor or subcontractor may be listed on a bid proposal for a public works project (submitted on or after March 1, 2015) unless registered with the Department of Industrial Relations pursuant to Labor Code section 1725.5 [with limited exceptions from this requirement for bid purposes under Labor Code section 1771.1(a)].
No contractor or subcontractor may be awarded a contract for public work on a public works project (awarded on or after April 1, 2015) unless registered with the Department of Industrial Relations pursuant to Labor Code section 1725.5.
This project is subject to compliance monitoring and enforcement by the Department of Industrial Relations.
For public projects advertised to bid after March 1, 2015, and for contracts awarded after April 1, 2015, all contractors who perform work on the project must be registered on the DIR website and have paid the $300 fee in order to be eligible to perform work. Contractors who have not registered have a 90 day grace period to register.
The Bottom Line: For contractors who perform public works, it is imperative to register on the DIR website and pay a $300 fee to qualify. Carefully read all calls for bids and proposed contracts, as language regarding the requirements should be included in such documents.
About the Author: Christina Denning
Christina Rimkus Denning, who has been in practice since 2000, joined Higgs Fletcher & Mack as a partner in 2011 after maintaining a practice in construction law, business litigation and personal injury. Ms. Denning recognizes that litigation can be expensive, so she proactively counsels businesses and individuals in carefully drafting contracts and other legal documents with the goal of avoiding litigation. If necessary, she litigates a wide array of disputes from the claim stage through arbitration or trial and post-judgment collection efforts. Click Here to View Her Bio
This article is provided for information only and is not intended for use as legal advice. This article was published in the National Association of Women in Construction newsletter: The Hard Hat, February, 2015.