Running the Business · Part 6

Becoming an RMO for someone else's company: the liability you are taking on, and the only version that is lawful

Lesson 8 of 12~9 minFree previewCurrent as of September 2026Leer en español

Lesson 0.4 covered the offer in its crude form: a friend pays you to "put your license on" a company. By year three the offer is dressed better: a real company with real jobs, a minority ownership stake, a title, and a monthly fee, from someone who lost their qualifier or never had one. This lesson is what saying yes means in law: you are personally responsible for that company's construction operations under section 7068.1, with a misdemeanor and license discipline if you do not actually supervise; the exceptions that allow a second license at all; the bond you will owe; the disassociation rule that keeps you responsible until CSLB receives your letter; and the narrow version of the arrangement that is lawful, which involves real ownership, real supervision, and a written agreement about both.

What the full lesson covers

  • A qualifier may serve a second company only under 7068.1(c): 20 percent common ownership, a subsidiary or joint venture, or the same majority of officers; and never more than three firms in a year (7068.1(b)). A monthly fee and a title do not satisfy any of them.
  • Even where the exception applies, 7068.1(a) makes you personally responsible for direct supervision and control of that company's construction operations, as 16 CCR 823 defines it; failure is a misdemeanor (six months, $3,000 to $5,000) and cause for discipline against your own license.
  • As an RMO owning under 10 percent, you owe a $25,000 qualifier bond in your name (7071.9); with less than 20 percent, you cannot lawfully be the second-company qualifier at all.
  • When you leave, you are responsible until the later of your disassociation date or CSLB's receipt of your written notice (7068.2); send it yourself, the day you leave, with proof.
  • The lawful version: genuine ownership of at least 20 percent, a written agreement that gives you authority over hiring, jobs, and compliance, a schedule of actual supervision you can document, insurance naming you, and a decision that the company's complaint history will be your license's history.

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