California Labor Code

§ 218.9

LAB § 218.9 Effective Jan 1, 2026Div. 2 · Part 1 · Ch. 1 · Art. 1

Statute text

(a)(1) For contracts entered into on or after January 1, 2026, a direct contractor making or taking a contract in the state for the erection, construction, alteration, or repair of a building, structure, or other private work, shall assume, and is liable for, any indebtedness for the performance of labor, including that described in subdivision (b) of Section 8024 of the Civil Code, incurred by a subcontractor at any tier acting under, by, or for the direct contractor included in the subject of the contract between the direct contractor and the owner. The direct contractor’s liability under this section shall be limited to payments for labor required by the subcontractor’s agreement with the laborer or the subcontractor’s collective bargaining agreement with the labor organization representing the laborer.

(2)Subject to paragraph (3), the direct contractor’s liability under this section shall extend to any indebtedness for labor described in paragraph (1), penalties or liquidated damages, and interest owed by the subcontractor on account of the performance of the labor.

(3)The direct contractor’s liability under this section shall extend to penalties and liquidated damages only as follows: If a worker employed by a subcontractor on a private construction project is not paid the wage, fringe or other benefit payment or contribution owed by the subcontractor on account of the worker’s performance of labor on that project, the direct contractor of the project is not liable for any associated penalties or liquidated damages under paragraph (2) unless the direct contractor had knowledge of the subcontractor’s failure to pay the specified wage, fringe or other benefit payment or contribution, or the direct contractor fails to comply with all of the following requirements:

…

Legislative history

Added by Stats. 2025, Ch. 774, Sec. 5. (SB 597) Effective January 1, 2026.