The largest contractor associations and building-trade recruiters, merit shop (see www.abc.org) and Union (see www.helmetstohardhats.com) recruit & train temporary labor pools to sit on wait lists between projects, sustained by State unemployment. This variable employment inevitably drives these desperate, unemployed workers into unlicensed residential side work.
California categorizes these weekend warriors without a contractor license as handymen, declares them limited to projects under $500, but has no mechanism to track cash earnings or resale tax from home owners, nor enforce skills-certifications, much less force owner-builder permits or inspections.
Exposure to Liability
If fire investigators found fuel residues on your burned-down property, arson would be suspected. Similarly, if property damage or bodily injury resulted from proven electrical-wiring negligence, which was not pre-existing, to the extent property insurance carriers’ use this evidence to avoid claims your fire-insurance / claim could be denied.
While every criminal contractor, handyman, and owner/builder avoids permits, legitimate operators encourage owners to cover their assets with permits, city inspections, and proper insurance policies during construction.
Legitimate operators aren’t afraid of inspections if they use properly listed equipment, and comply with building codes designed to avoid burning down the building. Beyond simple device replacements, owner permits and inspecion should follow any electrical wiring.
Repairs without permit are usually caught during 1) accidents 2) when disgruntled tenants, neighbors, or other observers report your construction to the city, or 3) during property sales, when obvious additions or negligence –not recorded by municipal permit– are caught by local inspectors hired by the new buyers/mortgage-insurance company.
Getting caught usually means expensive plan reviews and nit-picking inspections by the building department, but no punitive fines.