Do I need workers' comp to sub for a GC in California?

Usually, yes, but often because of the contract rather than the license. Under Business and Professions Code section 7125, a licensee with no employees can file an exemption with CSLB today, unless the license holds C-8, C-20, C-22, C-39 or D-49. From 1 January 2028 every licensee needs workers' comp except a joint venture with no employees. Separately, most commercial GC subcontracts require workers' comp as a signing condition, often with a waiver of subrogation.

What is SB 216 and when did it take effect?

SB 216 (Stats. 2022, ch. 978) took effect on 1 January 2023. It barred the no-employee exemption for C-8 concrete, C-20 HVAC, C-22 asbestos abatement and D-49 tree service licenses (C-39 roofing was already barred), and it added a version of section 7125 requiring every licensee to carry workers' comp, except a joint venture with no employees. That version was due on 1 January 2026; SB 1455 (Stats. 2024, ch. 485) moved it to 1 January 2028.

What's the difference between a real WC policy and a ghost policy?

A real WC policy covers your employees. A ghost policy (owner-only, zero payroll) covers no one: it produces a certificate, but it does not cover anyone you hire, and some GCs and compliance portals refuse it for that reason.

What do GCs require on a certificate of insurance?

GCs require a certificate of insurance (COI) naming them as the certificate holder, plus a waiver of subrogation endorsement in their favor. This is a national contract standard, not California-specific.

How much does workers' comp insurance cost for a subcontractor?

There is no useful average. A real WC policy is rated on your class code, your payroll and your experience modification, so two subs with the same headcount can be priced very differently. Ask a licensed professional to quote your own class code.

Does a ghost policy satisfy a GC's insurance requirement?

Often not. An owner-only, zero-payroll ghost policy produces a certificate, but it covers no employees, and some GCs and compliance portals refuse it for that reason.

How much does a real workers' comp policy cost for a small sub?

There is no meaningful average. A real WC policy is rated on your class code, your payroll and your experience modification, so two subs with the same headcount can be priced very differently. Ask for a quote on your own class code.

Do You Need Workers' Comp to Sub for a GC in California?

Workers' comp to sub for a GC in California: what a CSLB license requires today, the five classifications that need it with no employees, the 1 January 2028 change, and why the subcontract may require it anyway.

This content is general information only and is not legal, tax, financial or insurance advice. Speak to an appropriately licensed professional before acting on it.

As of 19 October 2026. Every legal fact on this page links to the California statute it comes from. California only.

In California, a licensed contractor with no employees does not need workers' comp under state law today, unless the license holds a C-8, C-20, C-22, C-39 or D-49 classification: that contractor can file an exemption with CSLB instead (Business and Professions Code section 7125(b)). From 1 January 2028, every licensee will need workers' comp except a joint venture with no employees. SB 216 first set that date at 1 January 2026; SB 1455 moved it to 1 January 2028. Separately, most commercial subcontracts require workers' comp as a contract term, so the practical answer for a sub bidding GC work today is usually yes.

Methodology: Ranked by California regulatory priority and subcontract prevalence, not by insurance cost.

TL;DR

State law today: workers' comp, or an exemption filed with CSLB if you have no employees. A license holding C-8, C-20, C-22, C-39 or D-49 must carry workers' comp even with no employees. (§ 7125)
From 1 January 2028: every licensee needs workers' comp, except a joint venture with no employees. (SB 216, delayed by SB 1455)
Penalties: since 1 January 2026, SB 291 sets a minimum civil penalty of $10,000 per violation for a sole owner, and $20,000 for an entity, that employs workers without coverage. (§ 7125.4)
Contract law: most commercial GC subcontracts require workers' comp as a signing condition, often with a waiver of subrogation, whatever the statute says.
Common pitfall: a "ghost policy" (owner-only, zero payroll) produces a certificate, but it covers no employees, and some GCs and compliance portals refuse it for that reason.
Cost: A real WC policy is priced off your class code, your payroll and your experience mod, so there is no useful average — a roofer and a low-voltage sub with the same headcount are not close. Get a quote against your own class code before you assume anything.

This is a fit-first guide, not a purchase recommendation. Don't buy a policy until you have confirmed both your CSLB classification requirement and the exact certificate-holder language in your GC's subcontract exhibit — the two can demand different things.

Definition Box

Workers' compensation (workers' comp / WC): State-mandated insurance that pays medical bills and lost wages for employees injured on the job. In California every employer must secure it (Labor Code section 3700), the system is administered by the Department of Industrial Relations, and coverage is enforced for contractors by the CSLB. A certificate of insurance (COI) proves you have it; the certificate holder is the party (usually the GC) listed as needing proof.

Do I actually need workers' comp to sub for a GC in California?

Usually, yes. There are two separate rules pushing you toward it, and they trip people up because they answer different questions.

Rule 1 — CSLB licensing (Business and Professions Code section 7125). Today a licensee must keep a workers' comp certificate on file, or file a statement that it has no employees. Since 1 January 2023, SB 216 has barred that exemption for C-8 concrete, C-20 HVAC, C-22 asbestos abatement and D-49 tree service, and the same section already barred it for C-39 roofing. From 1 January 2028 the exemption ends for every license except a joint venture with no employees; SB 216 first set that date at 1 January 2026, and SB 1455 moved it. (§ 7125, SB 1455, CSLB workers' comp page) This is California-specific and state-administered. Do not assume your home state works the same way.

Rule 2 — The subcontract itself. Separately, the GC's insurance-requirements exhibit almost always lists workers' comp as required coverage, usually alongside a waiver of subrogation in the GC's favor and a demand that the GC be named as certificate holder. This is a private contract term, not a state rule — so even a legitimately exempt sole proprietor can still be barred from the job if the subcontract requires an active policy. Read the insurance exhibit before you sign; the coverage limits, endorsements, and certificate-holder language there frequently exceed the bare minimum section 7125 imposes.

Because the two rules answer different questions — "Can I legally hold my license?" versus "Can I sign this particular subcontract?" — confirm both before committing to a policy. The safest path for a sub bidding GC work today is a real workers' comp policy that satisfies the CSLB and carries the endorsements the subcontract names.

Sources

Every legal statement above is taken from these primary sources, each read on 19 October 2026. Laws change: check the source before you rely on a date or an amount.

Business and Professions Code section 7125 (current version, and the version operative 1 January 2028). Read 19 October 2026.
Business and Professions Code section 7125.4 (as amended by SB 291, Stats. 2025, ch. 455). Read 19 October 2026.
SB 216 (Dahle), Stats. 2022, ch. 978, chaptered text. Read 19 October 2026.
SB 1455 (Ashby), Stats. 2024, ch. 485, chaptered text, approved 22 September 2024. Read 19 October 2026.
SB 291 (Grayson), Stats. 2025, ch. 455, chaptered text, approved 7 October 2025. Read 19 October 2026.
California Labor Code section 3700. Read 19 October 2026.
CSLB, Workers' Compensation Requirements. Read 19 October 2026.