EFFECTIVE JANUARY 1, 2026SB 291: California Contractor Penalties
SB 291: California Contractor Penalties
$10,000–$20,000 Minimum for No Workers' Comp
California Senate Bill 291 took effect January 1, 2026. It dramatically increased the minimum financial penalties for licensed contractors who operate without required workers' compensation insurance. If you're in a Phase 1 trade (C-8, C-20, C-22, C-39, C-61/D-49) or have employees, you must have WC on file with CSLB — or face a $10,000–$20,000 minimum fine.
SB 291 Penalty Schedule
Effective January 1, 2026 — these are MINIMUM penalties. Courts may impose higher amounts.
Sole Proprietor
$10,000
Minimum fine for a sole proprietor operating without required WC coverage. Applies to all Phase 1 SB 216 trades working solo.
Corporation / LLC / Partnership
$20,000
Minimum fine for business entities (LLCs, corporations, partnerships) operating without required WC. LLC contractors face both this penalty AND license suspension.
License Suspension
Immediate
CSLB can suspend your contractor license immediately upon finding non-compliance. You cannot legally bid or work with a suspended license.
Who Must Have Workers' Comp in California?
| Contractor Type | WC Required? | Effective Date | SB 291 Penalty |
|---|---|---|---|
| Any contractor with employees | YES — always | Labor Code §3700 | $10K–$20K |
| C-8 Concrete (solo) | YES — SB 216 Phase 1 | Jan 1, 2023 | $10K–$20K |
| C-20 HVAC (solo) | YES — SB 216 Phase 1 | Jan 1, 2023 | $10K–$20K |
| C-22 Asbestos (solo) | YES — SB 216 Phase 1 | Jan 1, 2023 | $10K–$20K |
| C-39 Roofing (solo) | YES — SB 216 Phase 1 | Jan 1, 2023 | $10K–$20K |
| C-61/D-49 Tree Service (solo) | YES — SB 216 Phase 1 | Jan 1, 2023 | $10K–$20K |
| All other solo contractors | YES — SB 1455 | Jan 1, 2028 | $10K–$20K |
| LLC contractors (all classes) | YES — LLC GL requirement | Ongoing | $20K (entity) |
How to Comply — timely
We can bind your policy and file the certificate with CSLB electronically the same business day.
👷
Have Employees?
You need a standard WC policy. We shop multiple insurance markets for your trade and payroll size.
Get WC Quote →👻
Solo Contractor?
A ghost policy satisfies CSLB at $800–Varies. No employees needed — just the license holder.
Ghost Policy Info →🏢
LLC Contractor?
You need both the $25K bond AND the $100K LLC Employee/Worker Bond, plus WC.
LLC Bond Info →⚡
Policy Lapsed?
timely reinstatement available. We file the new certificate with CSLB electronically.
Get Reinstated Now →Frequently Asked Questions — SB 291
Don't Risk a $10,000–$20,000 Fine
Get compliant today. timely WC policies available.