Plumbing Contractor Company Licensing

About Company Licensing

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

In addition to plumbing-specific licenses, several states require plumbing contractors to obtain a generic contractor license. Plumbing contractors in Iowa, for example, are required to obtain a plumbing contractor license from the Department of Public Health and must complete a construction contractor registration through the Division of Labor.

Plumbing contractor licenses may be issued to individual plumbers 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. Some states also require that individually licensed contractors be an officer of the business that their license covers.

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, plumbing contractor companies must designate a qualifying employee as the plumber of record. The plumber of record is typically required to be a master plumber or a similarly senior plumber 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
• Surety bond
• General liability or bodily injury insurance
• Licensed plumber information
• List of officers or members

Some states require the qualifying plumber 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 plumbing 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 plumbing contractor licenses. Firms with plumbing projects in Chicago, for instance, would need to apply for a city-issued license in addition to the state-level plumbing contractor registration.

Permits

Most cities and counties and some states require businesses to obtain a permit before performing plumbing installations, alterations, replacements, or repairs within commercial or residential structures. Minor repairs, however, are typically exempt from permitting requirements.

Permit applications vary by locality, but many require information about the plumber or plumbing 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

Plumbing contractor licenses need to be renewed on an annual, biennial, or triennial basis depending on the state. Licenses that are not renewed by the due date become inactive until the renewal is filed. Having an inactive license means that your company 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 plumbing activities can be hit with steep penalties. Civil penalties vary by state and the circumstances of the violation, but they can amount to thousands of dollars per violation. Violators of the Michigan State Plumbing Act, for example, can be fined up to $5,000 per offense.

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