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CSLB CONTRACTOR'S LAW & BUSINESS
EXAM 2025 QUESTIONS AND ANSWERS
An employer remits State disability taxes withheld from an
employees wages to what agency? - correct answer-
Employment Development Department
Which act establishes the rights of workers to organize into
unions and negotiate contracts? - correct answer- National
Labor Relations Act of 1935
A contractor has had a problem with employees stealing tools
and equipment from job sites. When conducting job interviews,
may the contractor ask prospective employees about their
arrest records?
A. It is legal to ask prospective employees about arrests not
leading to convictions.
B. It is not legal to ask prospective employees about arrests not
leading to convictions.
C. It is legal for a private employer to ask about arrests not
leading to convictions, but it would not be legal for city or
county agencies to ask about such arrests.
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D. It is legal for a private employer to ask about arrests leading
to convictions, but it would not be legal for a federal, state, or
local public agency to do so. - correct answer- It is not legal to
ask prospective employees about arrest not leading to
convictions.
Why would a contractor have a case in Superior Court? -
correct answer- If it is a dispute of more than $25,000 it can be
transferred to Superior Court.
Which would not have to be reported to DOSH immediately or
within 24 hours?
A. Death from a three-story fall.
B. Drunken crane operator hits a high-voltage power line
C. Car accident in which an employee steps onto a public road,
gets hit by a car, and suffers a concussion.
D. Employee falls off forklift and suffers a sever back injury. -
correct answer- Car accident in which an employee steps onto
a public road, gets hit by a car, and suffers a concussion.
A general contractor has obtained bids from several
subcontractors for a private project. He notices that one bid is
substantially lower than the rest. Is it ethical and a good
business practice for this contractor to inform the subcontractor
that the bid is substantially lower than the bids of the other
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subcontractors? - correct answer- Yes. If the contractor has
reason to believe that the subcontractor has made an error in
preparing his bid, the contractor should notify the subcontractor
of the apparent error, but the contractor may not disclose the
amounts of the other bids.
An employer must furnish an employee with a completed IRS
Form W-2 (Wage and Tax Statement) by: - correct answer- The
31st of January.
After a job is completed, the owner decides to have additional
work done. How should the contractor proceed? - correct
answer- Write a new contract and ask the owner to sign it.
The purpose of a 20-day preliminary notice for private work is
to? - correct answer- Notify the owner that the person or firm
who sent the notice has improved the property.
Is it legal for a contractor to pay employees in cash? - correct
answer- Yes, if the contractor provides each employee with a
wage deduction statement semimonthly or at the time of each
wage payment.
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You are bidding on a job with plans drawn by the owner. You
notice a code violation and bring it to the attention of the owner.
The owner declines to remedy the code violation and tells you
not to worry. What should you do? - correct answer- Decline to
bid the work.
On a time-and-materials job, you should: - correct answer- Add
profit and overhead to labor and materials
Your employee sets a cabinet wrong. The cabinet falls from the
wall and damages the client's counter top. What should you
do?
A. Claim the damage on your general liability insurance policy.
B. Require the employee to pay for the damage to the
countertop.
C. Tell the client to claim the damaged counter top on his or her
homeowner's insurance policy.
D. No action is required: The client must assume the risk of
damage. - correct answer- Claim the damage on your general
liability insurance policy.
Of the following, which is best for determining the number of
hours required for different phases of a project and for making
sure the job is on schedule?
CSLB CONTRACTOR'S LAW & BUSINESS
EXAM 2025 QUESTIONS AND ANSWERS
An employer remits State disability taxes withheld from an
employees wages to what agency? - correct answer-
Employment Development Department
Which act establishes the rights of workers to organize into
unions and negotiate contracts? - correct answer- National
Labor Relations Act of 1935
A contractor has had a problem with employees stealing tools
and equipment from job sites. When conducting job interviews,
may the contractor ask prospective employees about their
arrest records?
A. It is legal to ask prospective employees about arrests not
leading to convictions.
B. It is not legal to ask prospective employees about arrests not
leading to convictions.
C. It is legal for a private employer to ask about arrests not
leading to convictions, but it would not be legal for city or
county agencies to ask about such arrests.
,2 | Page
D. It is legal for a private employer to ask about arrests leading
to convictions, but it would not be legal for a federal, state, or
local public agency to do so. - correct answer- It is not legal to
ask prospective employees about arrest not leading to
convictions.
Why would a contractor have a case in Superior Court? -
correct answer- If it is a dispute of more than $25,000 it can be
transferred to Superior Court.
Which would not have to be reported to DOSH immediately or
within 24 hours?
A. Death from a three-story fall.
B. Drunken crane operator hits a high-voltage power line
C. Car accident in which an employee steps onto a public road,
gets hit by a car, and suffers a concussion.
D. Employee falls off forklift and suffers a sever back injury. -
correct answer- Car accident in which an employee steps onto
a public road, gets hit by a car, and suffers a concussion.
A general contractor has obtained bids from several
subcontractors for a private project. He notices that one bid is
substantially lower than the rest. Is it ethical and a good
business practice for this contractor to inform the subcontractor
that the bid is substantially lower than the bids of the other
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subcontractors? - correct answer- Yes. If the contractor has
reason to believe that the subcontractor has made an error in
preparing his bid, the contractor should notify the subcontractor
of the apparent error, but the contractor may not disclose the
amounts of the other bids.
An employer must furnish an employee with a completed IRS
Form W-2 (Wage and Tax Statement) by: - correct answer- The
31st of January.
After a job is completed, the owner decides to have additional
work done. How should the contractor proceed? - correct
answer- Write a new contract and ask the owner to sign it.
The purpose of a 20-day preliminary notice for private work is
to? - correct answer- Notify the owner that the person or firm
who sent the notice has improved the property.
Is it legal for a contractor to pay employees in cash? - correct
answer- Yes, if the contractor provides each employee with a
wage deduction statement semimonthly or at the time of each
wage payment.
, 4 | Page
You are bidding on a job with plans drawn by the owner. You
notice a code violation and bring it to the attention of the owner.
The owner declines to remedy the code violation and tells you
not to worry. What should you do? - correct answer- Decline to
bid the work.
On a time-and-materials job, you should: - correct answer- Add
profit and overhead to labor and materials
Your employee sets a cabinet wrong. The cabinet falls from the
wall and damages the client's counter top. What should you
do?
A. Claim the damage on your general liability insurance policy.
B. Require the employee to pay for the damage to the
countertop.
C. Tell the client to claim the damaged counter top on his or her
homeowner's insurance policy.
D. No action is required: The client must assume the risk of
damage. - correct answer- Claim the damage on your general
liability insurance policy.
Of the following, which is best for determining the number of
hours required for different phases of a project and for making
sure the job is on schedule?
