California contractors, there are new laws going into effect January 1, 2026. These laws may impact your business operations, contracts, and licensing. Check out Business Consumer Alliance’s (BCA) breakdown of the 2026 updates below. BCA members are urged to contact BCA to get updated business contracts to comply with these changes.
AB 1002 (Gabriel) – The Attorney General (AG) and CSLB are now jointly authorized to bring civil actions to suspend, revoke, or deny a contractor’s license for failing to pay workers or comply with a wage judgment or court order. The AG must notify CSLB before initiating such action, and CSLB may choose to intervene or collaborate in the proceedings.
AB 1327 (Aguiar-Curry) – Contractors working in the home improvement sector must now include their email address in home improvement contracts and allow buyers to cancel via email. Contracts must also include a telephone number to help buyers locate and complete the “Notice of Cancellation.” If this notice is missing, consumers may file a complaint with CSLB.
SB 291 (Grayson) – This bill significantly increases penalties for workers’ compensation (WC) insurance violations. The Board must also develop a new process to verify WC exemption eligibility and report findings to the Legislature by 2027. Annual reporting of WC enforcement data is also now required. Additional information on WC requirements can be found here.
SB 456 (Ashby) – A new licensure exemption has been created for muralists. Individuals who paint or restore murals under agreement with a legally authorized party are no longer required to hold a contractor license, provided the mural is a unique work of fine art painted by hand directly on an interior or exterior wall or ceiling, and protected by copyright or similar rights. This exemption does not apply to painted wall signs.
SB 517 (Niello) – Contractors using subcontractors in home improvement projects must now disclose that information upon request. This includes the subcontractor’s name, contact information, license number, and classification. While the prime contractor remains responsible for the overall project, subcontractors and home improvement salespersons may also face disciplinary action for violations.
SB 779 (Archuleta) – Beginning July 1, 2026, CSLB will increase minimum civil penalties for certain violations. Fines for unlicensed activity will start at $1,500, and other specified violations will carry minimum penalties of $500 or $1,500, depending on the offense. These amounts will be adjusted every five years based on the Consumer Price Index.
If you’re a contractor or know a contractor, make sure to check out the many benefits of BCA membership. We offer a host of services to help businesses, including contract assistance, help with human resource issues, a contractor match program, and more. Visit our website to schedule a free consultation today.
About Business Consumer Alliance
Business Consumer Alliance (BCA) is a nonprofit organization focused on strengthening integrity in the marketplace. We help consumers by resolving disputes and providing transparent business reputation reports. At the same time, we support contractors, movers, and small business owners with contract assistance, arbitration services, reputation management resources, along with business and HR advice. We’re here to help good businesses stand out and succeed while protecting the public.