Georgia Consumer Guide: Contractor Law

How do I actually verify that a Company or Individual is Licensed?

• Follow this link to the Georgia Secretary of State Verification Website

• If the work requires a license, Licenses must be held either by a Person or a Company (LLC/Corp)

• The Written Contract must be Signed by that specific Verifiable Licensed Entity.

• If the Permits are pulled by anyone other than the Contractor who Signed the Contract with the Owner, and who Performs and Supervises the work… the work by law is considered Unlicensed.

• It is illegal for Licensed Contractors to pull permits for projects that they themselves won’t administer or personally supervise.

• Legally pulled permits do not guarantee that a project is properly protected by the License.

What is a Contractor?

• Anyone who has a Contract with an Owner for Construction Work

Any Person or Entity offering construction management services who is at risk contractually to the owner (by contract) for the performance and cost of construction. § 43-41-2(4)(A)

Who needs to be a Licensed Contractor?

• Anyone offering more than $2,500 worth of work §43-41-2(9) and §43-41-17(f)

The Licensed Contractor must be involved and must:

• Hold the Contract directly with the owner. § 43-41-2(4)(A)

• Have at least one (1) person in the business that is authorized to engage in contracting business on behalf of themselves or the company and must…

• Be affiliated by full-time Employment or Ownership with the Contracting Entity §553-4-.03(1), 43-41-2(7)

• Be Responsible to Supervise, Direct, Manage, and Control construction activities on any project for which he or she has obtained a building permit. 43-41-2(7) Put simply, the Licensed Contractor can’t be an outside company or person that pulls the permits and walks away

• Individual Permit Applicant must have final approval authority for all construction work performed by the business organization

Who does NOT need to be Licensed?

• Anyone providing work under $2,500

• A Contractor Licensed in a Specialty Trade (electrical, plumbing, HVAC) who is doing general work that typically requires a license where:

  • the work is less than $10,000 or less than 25% of the total project cost

• A person/company offering Repair Work. §553-8-.01

  • Work must be supervised and performed by the entity who signs the contract

  • Must disclose in writing to the Owner that they are Not Licensed

  • Cannot Subcontract by delegating the work to non-employees or others

  • Must obtain Permits and Inspections as required

  • Work cannot affect life safety or Structural Integrity

Is Insurance required?

Yes.

When is Active Insurance invalidated?

Even if a contractor shows an active insurance certificate, For unlicensed Specific Trades and Repair/Handypeople, confirm that the policy covers unlicensed work. Most General Liability general contractor policies are invalidated if the holder is unlicensed. Confirm with the insurance company that they offer coverage for unlicensed work.