Law & Business · Module 2
Recordkeeping for Plumbing Contractors
Good records keep your license safe, win disputes and survive audits. This lesson lists the records a California plumbing contractor must keep and for how long: project records for at least 5 years after completion for CSLB, payroll and wage statements under the Labor Code, tax records for the IRS, FTB, EDD and CDTFA, Cal/OSHA injury logs and safety program records, and certified payroll on public works. It also covers written home improvement contracts, change orders and lien releases.
Key Takeaways
- CSLB can discipline a licensee who fails to keep records of all contracts, documents, receipts and disbursements for at least 5 years after completion of the project (B&P 7111).
- Home improvement contracts over $500 must be written and signed before work starts, as must change orders (B&P 7159).
- Lien waivers and releases work only on the statutory forms; a conditional release also needs evidence of payment (Civil Code 8124).
- Payroll records of daily hours and wages, and copies of itemized wage statements, must be kept at least 3 years under the Labor Code; EDD asks for at least 4 years.
- Tax records: IRS generally 3 years (employment tax records at least 4); FTB generally 4 years; CDTFA at least 4 years.
- Employers with more than 10 employees generally keep the Cal/OSHA 300, 300A and 301 forms for 5 years after the year they cover; every employer keeps IIPP inspection and training records.
- On public works, keep certified payroll records and send them to the Labor Commissioner electronically at least monthly (Labor Code 1771.4, 1776).
Why This Matters
CSLB's Law and Business study guide lists "Evaluation and record-keeping" under Employment Requirements and financial reporting under Business Finances. Records also decide who wins when a customer says the work was never authorized, when EDD questions whether a helper was an employee, or when CSLB asks to see a job file. The rule of thumb for any single record is simple: keep it for the longest period that any agency applies to it.
CSLB: Project Records for 5 Years
- The rule: failing to make and keep records showing all contracts, documents, records, receipts and disbursements of all your transactions as a contractor, and to have them available to the Registrar for at least 5 years after completion of the project they refer to, is a cause for discipline. So is refusing a written request from the Registrar to see them (B&P 7111).
- What goes in a job file: the signed contract and any change orders, plans and specifications, permits and inspection sign-offs, supplier invoices and delivery tickets, subcontracts, invoices to the customer and proof of payments, lien notices and releases, photos and correspondence.
- Why many contractors keep them longer: an action for a latent defect (one not apparent by reasonable inspection) can be brought up to 10 years after substantial completion of the improvement, and not later (Code of Civil Procedure 337.15).
Would you pass the C-36 today?
Take the free 21-question practice test. About 10 minutes, no account needed. You get your score by section and see exactly where you are losing points.
Take the free testKeep reading — unlock the full lesson
You're reading a free preview. Get the complete lesson plus everything you need to pass the California C-36 exam:
- All in-depth lessons, exam prep and After the License
- 1,000+ practice questions
- AI tutor (100 messages included)
- 14+ hours of audio lessons
- Full-length practice exams
- Pass guarantee
Already have an account? Sign in
More lessons in Business
- 1Business Finance for Plumbing Contractors
- 2Business Organization Types and Your CSLB License
- 3Job Costing
- 4Tax Responsibilities for California Plumbing Contractors
- 5Insurance and Bond Requirements
- 6Recordkeeping for Plumbing ContractorsYou are here
- 7Risk Management for Plumbing Contractors
- 8Safety Regulations for Employers