CSLB CONTRACTOR'S LAW & BUSINESS EXAM NEW!!
2025/2026 RATED A+
An employer remits State disability taxes withheld from an employees wages to what agency? -
Correct Answers Employment Development Department
Which act establishes the rights of workers to organize into unions and nego"ate contracts? -
Correct Answers Na"onal Labor Rela"ons Act of 1935
A contractor has had a problem with employees stealing tools and equipment from job sites.
When conduc"ng job interviews, may the contractor ask prospec"ve employees about their
arrest records?
A. It is legal to ask prospec"ve employees about arrests not leading to convic"ons.
B. It is not legal to ask prospec"ve employees about arrests not leading to convic"ons.
C. It is legal for a private employer to ask about arrests not leading to convic"ons, but it would
not be legal for city or county agencies to ask about such arrests.
D. It is legal for a private employer to ask about arrests leading to convic"ons, but it would not
be legal for a federal, state, or local public agency to do so. - Correct Answers It is not legal to
ask prospec"ve employees about arrest not leading to convic"ons.
Why would a contractor have a case in Superior Court? - Correct Answers 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 forkli7 and suffers a sever back injury. - Correct Answers 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
no"ces that one bid is substan"ally lower than the rest. Is it ethical and a good business prac"ce
for this contractor to inform the subcontractor that the bid is substan"ally lower than the bids
of the other subcontractors? - Correct Answers Yes. If the contractor has reason to believe
that the subcontractor has made an error in preparing his bid, the contractor should no"fy 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 Answers The 31st of January.
A7er a job is completed, the owner decides to have addi"onal work done. How should the
contractor proceed? - Correct Answers Write a new contract and ask the owner to sign it.
The purpose of a 20-day preliminary no"ce for private work is to? - Correct Answers No"fy
the owner that the person or firm who sent the no"ce has improved the property.
Is it legal for a contractor to pay employees in cash? - Correct Answers Yes, if the contractor
provides each employee with a wage deduc"on statement semimonthly or at the "me of each
wage payment.
, You are bidding on a job with plans drawn by the owner. You no"ce a code viola"on and bring it
to the a@en"on of the owner. The owner declines to remedy the code viola"on and tells you
not to worry. What should you do? - Correct Answers Decline to bid the work.
On a "me-and-materials job, you should: - Correct Answers 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 ac"on is required: The client must assume the risk of damage. - Correct Answers 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?
A. Bar graph and chart
B. Cash analysis chart
C. Review plans
D. Cri"cal path method - Correct Answers The cri"cal path method.
Is it legal for a contractor to require employees to take a lie detector test? - Correct Answers
It is not legal for the contractor to require lie detector tests, but it would be legal for a federal,
state, or local public agency to require lie detector tests of their employees.
, If a newly hired employee does not have a SSN, what should be done? - Correct Answers The
employee must apply for a SSN.
How many "mes may you take the contractors license exam before your original applica"on is
voided? - Correct Answers As many "mes as necessary within 18 months.
When should a contractor renew the contractor's license bond? - Correct Answers 30 days
before it expires.
The qualifying RME for a construc"on firm must work at least: - Correct Answers A qualifying
RME for a construc"on firm must work at least 32 hours per week or 80% of the work week.
The federal Employer Iden"fica"on Number (EIN) is issued by the: - Correct Answers The
Internal Revenue Service
Every employer of ______ or more full or part "me employees must keep wri@en health and
safety records for _______ years.
A. 1-3
B. 7-4
C. 10-3
D. 11-5 - Correct Answers Every employer of 11 or more full or part "me employees must
keep wri@en health and safety records for 5 years.
A7er you have read the plans and specifica"ons, what is the next important step in wri"ng a
bid?
A. Talk to and select subs.
2025/2026 RATED A+
An employer remits State disability taxes withheld from an employees wages to what agency? -
Correct Answers Employment Development Department
Which act establishes the rights of workers to organize into unions and nego"ate contracts? -
Correct Answers Na"onal Labor Rela"ons Act of 1935
A contractor has had a problem with employees stealing tools and equipment from job sites.
When conduc"ng job interviews, may the contractor ask prospec"ve employees about their
arrest records?
A. It is legal to ask prospec"ve employees about arrests not leading to convic"ons.
B. It is not legal to ask prospec"ve employees about arrests not leading to convic"ons.
C. It is legal for a private employer to ask about arrests not leading to convic"ons, but it would
not be legal for city or county agencies to ask about such arrests.
D. It is legal for a private employer to ask about arrests leading to convic"ons, but it would not
be legal for a federal, state, or local public agency to do so. - Correct Answers It is not legal to
ask prospec"ve employees about arrest not leading to convic"ons.
Why would a contractor have a case in Superior Court? - Correct Answers 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 forkli7 and suffers a sever back injury. - Correct Answers 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
no"ces that one bid is substan"ally lower than the rest. Is it ethical and a good business prac"ce
for this contractor to inform the subcontractor that the bid is substan"ally lower than the bids
of the other subcontractors? - Correct Answers Yes. If the contractor has reason to believe
that the subcontractor has made an error in preparing his bid, the contractor should no"fy 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 Answers The 31st of January.
A7er a job is completed, the owner decides to have addi"onal work done. How should the
contractor proceed? - Correct Answers Write a new contract and ask the owner to sign it.
The purpose of a 20-day preliminary no"ce for private work is to? - Correct Answers No"fy
the owner that the person or firm who sent the no"ce has improved the property.
Is it legal for a contractor to pay employees in cash? - Correct Answers Yes, if the contractor
provides each employee with a wage deduc"on statement semimonthly or at the "me of each
wage payment.
, You are bidding on a job with plans drawn by the owner. You no"ce a code viola"on and bring it
to the a@en"on of the owner. The owner declines to remedy the code viola"on and tells you
not to worry. What should you do? - Correct Answers Decline to bid the work.
On a "me-and-materials job, you should: - Correct Answers 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 ac"on is required: The client must assume the risk of damage. - Correct Answers 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?
A. Bar graph and chart
B. Cash analysis chart
C. Review plans
D. Cri"cal path method - Correct Answers The cri"cal path method.
Is it legal for a contractor to require employees to take a lie detector test? - Correct Answers
It is not legal for the contractor to require lie detector tests, but it would be legal for a federal,
state, or local public agency to require lie detector tests of their employees.
, If a newly hired employee does not have a SSN, what should be done? - Correct Answers The
employee must apply for a SSN.
How many "mes may you take the contractors license exam before your original applica"on is
voided? - Correct Answers As many "mes as necessary within 18 months.
When should a contractor renew the contractor's license bond? - Correct Answers 30 days
before it expires.
The qualifying RME for a construc"on firm must work at least: - Correct Answers A qualifying
RME for a construc"on firm must work at least 32 hours per week or 80% of the work week.
The federal Employer Iden"fica"on Number (EIN) is issued by the: - Correct Answers The
Internal Revenue Service
Every employer of ______ or more full or part "me employees must keep wri@en health and
safety records for _______ years.
A. 1-3
B. 7-4
C. 10-3
D. 11-5 - Correct Answers Every employer of 11 or more full or part "me employees must
keep wri@en health and safety records for 5 years.
A7er you have read the plans and specifica"ons, what is the next important step in wri"ng a
bid?
A. Talk to and select subs.
