Virginia Contractor Laws

These classifications and specialties are identified by three letters, which are then printed at the end of your license. It is important that contractors accurately choose the right specialty that describes the company`s work to ensure that there is no violation of the regulations related to each specialty. Violation of the regulations may result in disciplinary action against the contractor`s licence. According to 18 VAC 50-22-260, all contractors who deal with “housing contracts” must have a written contract that contains certain mandatory minimum conditions. “Residential contracts” are defined as performance bonds required for all public works contracts valued at $500,000 or more and for transportation-related projects over $350,000. However, under Virginia state law, “non-transportation construction contracts valued at $100,000 but less than $500,000 that waive performance guarantee and payment requirements are required to prequalify potential contractors for each individual project in accordance with section 2.2-4317.” Note that this civil lawsuit brought by the plaintiff-employee against the owner of the defendant business is in addition to any sanctions or penalties that the Virginia government or the U.S. federal government may impose for misclassification. In a separate but related law that will go into effect on January 1, 2021, Virginia may impose the following penalties (see Va. Code § 58.1-1901): Section 40.1-28.7:7 creates a private cause of action allowing employees to sue employers directly for misclassifying them as an independent contractor instead of an employee.

Virginia law will now assume that those who provide services for payment will automatically be considered employees. As a result, the employer now has the burden of proof that an employee instead qualifies as an independent contractor under the IRS Guidelines for Independent Contractors and 26 C.F.R. § 31.3121(d)-1. •5. A statement guaranteeing that the contractor will meet all local building permit, inspection and zoning requirements; Virginia law requires employers who regularly employ more than two part-time or full-time employees, including contractors, to provide proof of workers` compensation insurance. For more information, visit the Virginia.gov website. In addition to the Registration Requirements of Commonwealth of Virginia businesses as well as the licensing requirements of the DPOR Board for Contractors, there may be additional permit requirements set by cities, municipalities, municipalities, or local governments below the state level. These vary, but it is always the contractor`s responsibility to know and follow all registration and licensing requirements relevant to the region in which they operate.

The Class A Contractor License Exam is a three-part exam consisting of the Virginia, General, and Advanced sections. The advanced section thoroughly tests the candidate`s general administrative and business knowledge. Under the new law, an employee must prove that the employer was “aware” of a misclassification. However, the text of the law does not explain whether the term “knowledge” means real or constructive knowledge of an erroneous classification. Therefore, any employer who receives a notice from an independent contractor about its classification status should be careful whether the notice supports the “knowledge” element in a classification error lawsuit. If an employee wins in their classification challenge, they may be awarded wages, salaries, benefits and costs (including health insurance), reasonable attorneys` fees and court costs as damages. Employers may also be held liable for tax arrears due to the change in employee status (see below). Every Commonwealth employer must understand and comply with the following new laws to avoid lawsuits and damages to employees, fines, penalties, tax levies and even exclusion from public contracts. •· Class B contractors can enter into individual contracts between $10,000 and $120,000 or total construction work of less than $150,000 over a 12-month period. All contractors in Virginia must have a Qualified Person (IQ) for the class and specialty/specialties specified in their application.

This person can also be the IQ for more than one classification or specialty. To qualify as a qualified person, a person must: The Class B Contractor Licence Exam consists of two parts consisting of a Virginia Section and a General Section. The Virginia Chapter tests the candidate`s knowledge of the state laws and regulations that govern entrepreneurs, while the General Section tests the candidate`s general administrative and business knowledge. The more complex the misclassification criterion, the more case-by-case determination it takes to meet this criterion, the greater the effort required to make the correct decision at the beginning of the employment relationship – taking into account, of course, the fact that this law assumes that your initial classification of an employee as an independent contractor is wrong. The legal fees required to prove that the employee is not an employee are difficult to quantify, but whatever they are, these costs fall directly on the business owner. A specialty can be described as the type of work or category in which the authorized contractor is performed. Individual tradespeople working as HVAC contractors, backflow blockers, building energy analysts, plumbers, gas installers, electricians or elevator mechanics are licensed by the Council of Contractors. The specialties are: Make no mistake, this new misclassification law and accompanying laws should be both punitive and redistributive. The plaintiff`s bar association now has a state-sanctioned hunting license, with the law stacked in four ways in favor of its client: (i) the presumption that its client is an employee, (ii) the burden placed not on its client, but on the defendant contractor to prove that the client is not an employee with a very complicated, the unfriendly test of the juror is (iii) the right to a jury trial with very limited opportunities for the business owner to appeal; and (iv) the ability to require the business owner to pay its fees and expenses. This new risk cannot be overestimated. This is a real fundamental change in the way business owners will now employ workers in Virginia.

Therefore, if you are involved in any of the activities described in the definition above, you must obtain the appropriate license from the Virginia Department of Professional and Professional Regulation. For both the Contractor and the person who engages the Contractor (“Owner” for the purposes of this section), there are legal requirements that govern the relationship and obligations of the Contractor and the Owner. An advanced contractor class approved by the Commission is also accepted to meet the requirements of the pre-licence course. Applicants can choose from an approved list of contractor board education providers to meet training requirements. .