What Is California Labor Code §2750.5: Licensed Contractor Presumption?

There is a rebuttable presumption affecting the burden of proof that a worker performing services for which a license is required pursuant to Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code, or who is performing such services for a person who is required to obtain such a license is an employee rather than an independent contractor.

What does Labor Code 2750.5 say, in plain words?

If your work needed a contractor's license, the law starts from the position that you are an employee.

Many California trades require a license from the Contractors State License Board under the Business and Professions Code: common examples include electrical, plumbing, roofing, HVAC, concrete, and general building work. Section 2750.5 says that a worker doing that kind of licensed work, or doing it for a business or person who must hold the license, starts out presumed to be an employee. That starting point holds whether the worker was paid hourly, by the job, in cash, or on a 1099.

A written contract that labels the worker an independent contractor does not control the outcome. The presumption looks past labels to the actual licensing and the actual working relationship.

Who does the Labor Code 2750.5 presumption cover?

It reaches a worker who personally does licensed work, and a worker who does that work for someone else who must hold the license.

The presumption covers two situations. First, a worker who personally performs work needing that kind of license. Second, a worker who performs that same kind of work for a business or person that is required to hold the license, even if that individual worker is not the one named on the license. A crew member on a licensed roofing or electrical job can fall into the second group even without holding a license personally.

Can a hiring business overcome this presumption?

Only with specific proof, and only if the worker actually held a valid license for the work.

The statute lists factors a hiring party can point to:

• The worker controls how the work gets done, with the finished result mattering more than the method
• The worker runs an independently established business of their own
• The arrangement is a genuine independent business, shown by things like the worker's own investment, marketing themselves for other jobs, project based pay, and supplying their own tools

None of that proof is enough by itself. The same section separately requires anyone performing licensed work to hold an actual, valid contractor's license as a condition of counting as an independent contractor for that work. Without a real license, the presumption of employee status is very hard for a hiring party to overcome.

Does holding your own license change the outcome?

Yes. Without a valid license for that specific work, California law does not let a hiring party prove contractor status instead.

This is the detail that trips people up. A worker can look like a contractor in every practical sense: using their own tools, setting their own hours, invoicing by the job, even calling themselves a business. None of that substitutes for an actual license when the work legally requires one. If a worker did licensed trade work without personally holding that license, this section pushes hard toward treating that worker as an employee for workers' compensation.

How does this connect to other employee or contractor rules?

It works alongside other California employee tests rather than replacing them.

Labor Code 3357 adds a broader, general presumption: outside of an independent contractor arrangement, or a specific exclusion written elsewhere, service performed for someone else is presumed to be employment. Section 2750.5 adds a narrower, harder to rebut presumption just for licensed trade work. Two other sections offer different tools: Labor Code 2775 sets out the ABC test used for most other kinds of work, and Labor Code 3353 gives the Labor Code's own definition of an independent contractor. None of these sections replaces another; a worker's situation can involve more than one.

What should you save if you were treated as a contractor on licensed trade work?

Keep proof of the actual work and who controlled it, not just what your pay stub or contract called you.

Save any contract or work order, invoices or pay records, and anything showing who scheduled the job, supplied materials, or directed the details. Keep track of whether you personally held a license for the trade, since that one fact carries real weight. Occupation guides such as our electrician injury lawyer and construction injury lawyer pages walk through how this plays out for specific trades.

If you were hurt doing licensed trade work and were told you do not qualify for workers' compensation because you were paid as a 1099 contractor, Yazdchi Law P.C. reviews each matter individually and can look at the actual working relationship with you. Call (661) 273-1780 or use the contact form for a free consultation.