Workers' compensation: the rule as it actually reads today, and the date it changes
In one paragraph
Most advice online says every California contractor needed workers' compensation by January 1, 2026, employees or not. The statute on the books today says something different: a C-10 with no employees may still file the exemption, and the exemption disappears for everyone on January 1, 2028 (SB 216 as amended by SB 1455). What is already true today is harsher than most people think: hire one person after filing an exemption and the license is suspended by operation of law, with a minimum $10,000 civil penalty for a sole owner and $20,000 for an entity.
The rule
B&P 7125(a) makes a current Certificate of Workers' Compensation Insurance (or self-insurance) in the business name a condition of issuing and keeping the license. Until January 1, 2028, 7125(b) lets a licensee with no employees file an exemption statement instead, unless the license carries C-8, C-20, C-22, C-39 or D-49. The version of 7125 operative on January 1, 2028 removes that exemption for every classification except a joint venture with no employees. Under 7125.2, failure to obtain or maintain required coverage suspends the license automatically on the date coverage lapses or is first required.
Why it matters
Two ways to lose the license in one section. Miss a policy renewal and the suspension is automatic, no hearing. File the exemption and then bring on a helper before a certificate is filed and, since January 1, 2026, the minimum civil penalty is $10,000 for a sole owner or $20,000 for a corporation or LLC, per violation, and the qualifier has committed a misdemeanor.