Electrical Contractor Company Licensing

About Company Licensing

Almost every state requires electrical contractor companies to obtain a license before providing electrical services. A contractor license generally allows the licensee to hire licensed electricians, bid on projects, and apply for the necessary permits for projects.

In addition to electric-specific licenses, several states require electrical contractors to obtain a generic contractor license. Electrical contractors in Oregon, for example, are required to obtain an electrical contractor license from the Building Codes Division as well as a construction contractor license from the Construction Contractors Board.

Electrical contractor licenses may be issued to individual electricians or to business entities depending on the state. In cases where only individuals are licensed as contractors, businesses should ensure that an employee of the business obtains and maintains the requisite licenses for practice.

In addition to licensing, companies should register with the secretary of state before conducting business in a state. New business entities will file incorporation or formation documents, while firms doing business outside of their home state will likely need to foreign qualify.

Getting Licensed

Before applying for a license, electrical contractor companies must designate an employee as the electrician in responsible charge of electrical activities. The electrician in charge is typically required to be a master electrician or a similarly senior electrician in states with no master licenses.

License application requirements vary by state, but contractors are often required to submit the following:

• Application fee
• Unemployment and workers’ compensation insurance information
• Certificate of authority if a foreign entity
• Licensed electrician information
• List of officers or members

Some states require the qualifying electrician to pass a contractor exam after the license application is approved. In these cases, the contractor license is issued after the qualifying individual passes the exam.

Businesses that take on electrical projects in multiple states may need to obtain a license in each state where they have a project. Some states have reciprocal agreements to honor licenses issued in other states, but these agreements are not common.

In addition to state-issued licenses, some counties and cities issue their own electrical contractor licenses. Firms with electrical projects in Denver, for instance, would need to apply for a city-issued license in addition to the Colorado electrical contractor registration

Permits

Most cities and counties require businesses to obtain a permit before performing electrical installations, alterations, replacements, or repairs within commercial or residential structures. Permit applications vary by locality, but many require information about the electrician or contractor performing the work as well as a detailed list of the work to be performed. Permits must be approved by the governing body before work can begin.

License Renewal

Electrical contractor licenses typically need to be renewed on an annual basis. Licenses that are not renewed by the due date become inactive until the renewal is filed. Having an inactive license means that your firm may not be able to pull permits and could also limit the firm’s ability to expand to new states.

Licenses that are inactive for a significant time can be revoked entirely by the state, and contractors that perform work under an inactive or revoked license may be subject to penalties.

Penalties

Businesses that do not follow state and local regulations while conducting electrical contracting activities can be hit with steep penalties. Civil penalties vary by state and the circumstances of the violation, but they typically amount to thousands of dollars per violation. In Texas, contractors that perform unlicensed activities or fail to meet local ordinances can be fined up to $5,000 per day and may face suspension or revocation of their license.

Click on a link below to view licensing information in your state.