swimming pool association

The hidden cost of hiring an unlicensed contractor

Todd Koontz
Spies Pool LLC

In Florida, it is a criminal offense to engage in contracting work or to act in the capacity of a contractor without a valid contractor’s license. It can be tempting for individuals or businesses to hire unlicensed contractors or subcontractors. As licensed pool contractors, the following points can help us educate our customers to help them avoid the potentially disastrous consequences of hiring unlicensed contractors.

Unlicensed contractors often lack general liability and workers’ compensation insurance. Some unlicensed contractors may try to fool a customer by providing a certified pool operator certificate instead of a contractor’s license. They may only provide an occupational license which is not a regulatory license or certificate of competency but a local tax paid for the privilege of engaging in or managing a business.

Unlicensed contractors are often poorly trained, the work they do can be shoddy, and they may use inferior materials and violate federal/state/local building codes. This can result in your customer having to hire a licensed contractor to complete the repairs correctly and pay more money for the job than if they hired a licensed contractor in the first place. If the unlicensed contractor fails to pay his or her subcontractors or suppliers, the customer may be legally forced to pay them, even though they have already paid the contractor.

According to Florida Statute 455.228, if your customer knowingly hires an unlicensed contractor they become the general contractor and the Department of Business and Professional Regulation (DBPR) may issue a cease and desist order which could result in your customer being taken to circuit court and being fined up to $5,000 for aiding and abetting an unlicensed contractor.

If your customer hires an unlicensed contractor, any damages during a repair are the customer’s responsibility. Also, if a worker gets injured on the job and can’t work there is no workers’ compensation so the customer may be responsible for any medical bills or lost wages. Most insurance policies won’t cover damages when a customer knowingly uses an illegal or unlicensed contractor, so the customer could face unlimited liability.

Licensed contractors need to educate their customers on what a licensed contractor looks like and how to look up a contractor’s license to confirm it is legitimate. Often unlicensed contractors will advertise themselves as licensed and insured without either being true. A customer should verify a contractor’s license at www.myfloridalicense.com. They should also ask for a copy of their insurance and contact that insurance company to verify the policy is current and legitimate.

Licensed contractors must have passed examinations showing they have knowledge about their craft, carry licensure from the state and county where the work will be performed, carry workers’ compensation to pay for medical expenses due to injuries, carry liability insurance to protect your property in case of accidental damage, file building permits if needed, at which time their license is verified to be in good standing, and get inspections to ensure project complies with standards for materials and building codes for construction. All licensed contractors can be sanctioned by the local License Review Board of Florida’s Construction Industry Licensing Board when their actions don’t comply with building codes or accepted business practices.

As you can see, there can be many destructive consequences for your customers in hiring unlicensed contractors. Keep a portfolio of your credentials and qualifications as a licensed pool contractor ready to share with all potential customers. It is your job as a licensed contractor to remind your customers why using an unlicensed contractor to save a few dollars may be tempting in the short run, but the potential risks of entering into an illegal contract far outweigh the perceived benefits.

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