Notes from the Capitol:
STATE OF MICHIGAN CRACKING DOWN ON UNLICENSED BUILDERS/CONTRACTORS

The good news is, for the first time in a decade, the State is actually cracking down on unlicensed building activity in a meaningful way. LARA is issuing “cease and desist” notices to unlicensed builders and referring them to the Attorney General’s office for further action. The bad news is many of these cases involve builders who hold active individual licenses but who sign contracts in the name of their building company which does not have a license. Corporations, limited liability companies and partnerships engaged in residential construction MUST have both a residential builder company license (often called a “corporate” license) and a qualifying officer for the company who holds an individual license. This has been the law since 2008.

If you have a corporation, LLC or partnership which is doing residential work and it does not have a corporate license two things can happen, both of them bad. First, if the contract is for over $600, your customer legally does not need to pay you for any work you do past that $600 threshold. Second, not having a business license can result in administrative, civil, and criminal sanctions, including a maximum fine of $10,000 per violation. A person not licensed under the Occupational Code as a residential builder who willfully violates the Code may be subject to criminal penalties.

Everyone should make sure their residential builder companies are properly licensed. First, if the contract is for over $600, your customer legally does not need to pay you for any work you do past that $600 threshold. Second, not having a business license can result in administrative, civil, and criminal sanctions, including a maximum fine of $10,000 per violation. A person not licensed under the Occupational Code as a residential builder who willfully violates the Code may be subject to criminal penalties.

Everyone should make sure their residential builder companies are properly licensed.

ATTORNEY GENERAL GOING AFTER 1099 VIOLATORS

With construction and landscaping firmly in mind, Attorney General Dana Nessel has created a new Payroll Fraud Enforcement Unit within the attorney general’s office, a move that was strongly supported by Democratic leaders in the House and the Senate as well as the Michigan Regional Council of Carpenters and Millwrights. A website has been set up for anyone to report potential violations of the law.