Exam terms in English and Spanish

415 terms

AbatementCorrección (abatement)

Fixing a hazard that Cal/OSHA cited, by the date set in the citation.

ABC testPrueba ABC

California's test for whether a worker is an employee. The hiring business must prove the worker is (A) free from its control, (B) doing work outside its usual business, and (C) in an independently established business.

Accounts payableCuentas por pagar

Money the business owes to suppliers, subcontractors, and others.

Accounts receivableCuentas por cobrar

Money customers owe the business for work that has been billed.

Accrual methodMétodo de acumulación

An accounting method that records income when it is earned and expenses when they are owed, not when cash changes hands.

Action levelNivel de acción

An exposure level, below the permissible exposure limit, that triggers requirements such as air monitoring or medical surveillance.

Active negligenceNegligencia activa

Careless conduct by a party itself. A public agency cannot use a construction contract to make a contractor pay for the agency's own active negligence (Civil Code §2782(b)).

AddendumAdenda (anexo)

A written change or addition to bid documents or a contract. Bid addenda are usually issued before bids are due.

Additional insuredAsegurado adicional

A person or company added to someone else's policy, such as a project owner added to the contractor's liability policy.

Additional insured endorsementEndoso de asegurado adicional

A policy change that adds another party, such as the public agency, as an insured on the contractor's liability policy.

Admitted surety insurerAseguradora afianzadora admitida

A surety company authorized by the California Insurance Commissioner to do business in the state. Bonds on public works must be issued by an admitted surety insurer.

AdvertisingPublicidad

Any ad, sign, card, vehicle lettering, or website offering contracting work. Licensed contractors must show their license number in ads, bids, and contracts.

Aggregate limitLímite agregado

The most an insurance policy will pay for all claims during one policy period. Once it is used up, the policy pays nothing more that period.

Aging reportReporte de antigüedad

A report that sorts receivables or payables by how long they have been unpaid, such as current, 31–60, 61–90, and over 90 days.

AllowanceAsignación (allowance)

A set dollar amount in a bid or contract for an item not yet selected, such as fixtures. The price is adjusted later to the actual cost.

Alternate (bid alternate)Alternativa (alternate)

A separately priced option on a bid form that adds work (additive) or removes work (deductive) from the base bid.

Annual permit (Cal/OSHA)Permiso anual (Cal/OSHA)

A Cal/OSHA permit for permit-required work at any job site for one year. The employer must notify Cal/OSHA before starting each new site.

ApprenticeAprendiz

A worker in a state-approved program who learns a trade through paid on-the-job training and classes.

Apprentice ratioProporción de aprendices

On covered public works, contractors must generally use at least 1 hour of apprentice work for every 5 hours of journeyman work in apprenticeable trades. Contracts under $30,000 are exempt.

ArbitrationArbitraje

A way to settle a dispute in which a neutral arbitrator hears both sides and makes a final decision. CSLB arbitration is binding.

Arbitration agreementAcuerdo de arbitraje

A signed agreement by the parties to let an arbitrator settle their dispute and to accept the decision.

Arbitration awardLaudo arbitral

The arbitrator's final decision. If a contractor does not comply, CSLB can suspend or revoke the license.

Arbitration of disputes clauseCláusula de arbitraje de disputas

An arbitration clause in a contract for work on residential property with four or fewer units. It must meet B&P §7191 rules, including the “ARBITRATION OF DISPUTES” heading, a notice in bold type, and a place for both parties to initial.

AsbestosAsbesto

A mineral fiber in many older building materials that can cause lung disease and cancer when disturbed. Work involving 100 square feet or more of asbestos-containing material requires registration with Cal/OSHA.

Asbestos open-book examExamen de asbesto a libro abierto

A short CSLB test about asbestos that applicants must complete before their license is issued.

Asbestos registration (Cal/OSHA)Registro de asbesto (Cal/OSHA)

The Cal/OSHA registration a contractor needs before doing asbestos-related work involving 100 square feet or more of asbestos-containing material.

Asbestos-containing material (ACM)Material que contiene asbesto (ACM)

Any material that contains more than 1% asbestos (Title 8 §1529).

AssetsActivos

Things of value a business owns, such as cash, accounts receivable, equipment, and buildings.

At-will employmentEmpleo a voluntad

Employment that either side can end at any time for any lawful reason, unless a contract says otherwise.

Awarding bodyEntidad adjudicadora

The public agency that awards a public works contract, such as a city, school district, or state agency.

B-2: Residential Remodeling ContractorB-2: contratista de remodelación residencial

A contractor who improves existing wood-frame homes using three or more unrelated trades on one project. A B-2 has limits on structural, electrical, plumbing, and HVAC work.

Balance sheetBalance general

A report of what a business owns (assets), owes (liabilities), and the owners' equity on one date. Assets always equal liabilities plus equity.

Bank reconciliationConciliación bancaria

Comparing the company's cash records with the bank statement to find and fix any differences.

Bar chart (Gantt chart)Diagrama de barras (diagrama de Gantt)

A schedule that shows each task as a bar on a timeline. It is easy to read but does not clearly show how tasks depend on each other.

BidOferta (propuesta de licitación)

A contractor's written price offer to do a specific job. Once accepted, it can become a binding contract.

Bid bondFianza de licitación

A bond sent with a bid promising that the bidder, if chosen, will sign the contract and provide the required bonds. If the bidder backs out, the owner can collect.

Bid peddlingBid peddling (ofrecer precio más bajo después de ofertar)

When a subcontractor, after bids are opened, offers to undercut the price of a subcontractor already listed in the prime bid.

Bid securityGarantía de oferta

Cash, a cashier's or certified check, or a bid bond submitted with a public works bid to guarantee the bidder will sign the contract if it wins.

Bid shoppingBid shopping (buscar precios más bajos después de ofertar)

When a prime contractor, after winning, uses one subcontractor's price to pressure other subcontractors to go lower. The subcontractor listing law on public works is meant to stop it.

BiddingLicitación

The process of pricing a job and submitting an offer to do the work.

Bond (surety bond)Fianza (vinculación)

A written promise by a surety company to pay if a contractor fails to meet certain duties. CSLB's Spanish study guide calls bonding vinculación; the common word is fianza.

Bond of qualifying individualFianza del individuo calificado

A $25,000 bond required for an RME, and for an RMO who owns less than 10% of the voting stock or equity. It is in addition to the contractor's license bond.

Bonded stop payment noticeAviso de suspensión de pago afianzado

A stop payment notice given to a construction lender together with a bond for 125% of the claim. The lender must then hold back enough loan funds to pay the claim.

Bonding capacityCapacidad de fianza

The largest amount of bonded work a surety will back for a contractor. It depends on the contractor's finances, experience, and track record.

Bonding requirementsRequisitos de vinculación

The bonds a contractor must file or provide, such as the license bond or the bonds required on public works. In everyday Spanish, requisitos de fianzas.

Book valueValor en libros

An asset's cost minus the depreciation recorded on it so far.

Borello testPrueba Borello

A multi-factor test from a 1989 California Supreme Court case that looks mainly at who controls how the work is done. It is used when a law exempts a work relationship from the ABC test.

Breach of contractIncumplimiento de contrato

Failing to do what a contract requires without a legal excuse.

Break-even pointPunto de equilibrio

The sales level at which revenue equals total costs, so there is no profit and no loss.

BudgetPresupuesto

A plan for expected income and spending for a period of time or a project.

Builder's risk insuranceSeguro de riesgo del constructor

Property insurance for a building while it is being built. It covers losses such as fire, theft, or storm damage to the work and materials.

Building codeCódigo de construcción

Rules that set minimum safety standards for building design and construction. California's building codes are in Title 24.

Building inspectionInspección de construcción

A check by the building department during and after construction to make sure the work meets the building codes.

Building permitPermiso de construcción

Approval from the local building department before starting certain work. Skipping a required permit can bring fines or force removal of the work.

Business dayDía hábil

For cancellation rights on home solicitation and home improvement contracts, any calendar day except Sunday and certain listed holidays (Civil Code §1689.5).

Business name styleNombre comercial

The name a license is issued under. It must not be misleading or suggest a classification the license does not have, and corporation and LLC names must match the Secretary of State record.

Business personal propertyBienes muebles del negocio

Taxable business property other than land and buildings, such as tools, equipment, furniture, and supplies.

Business planPlan de negocios

A written document that describes the company's work, market, management, and financial goals and plans.

C-22 Asbestos AbatementC-22 Eliminación de Asbesto

The CSLB license classification for contractors whose work is removing or encapsulating asbestos.

C-61: Limited SpecialtyC-61: especialidad limitada

A C classification for specialty work not covered by another C license, divided into D subcategories. The qualifier takes only the Law and Business exam.

Cal/OSHACal/OSHA (División de Seguridad y Salud Ocupacional)

The state program that sets and enforces workplace safety and health rules in California. Its rules are in Title 8.

Cal/OSHA Form 300A (Annual Summary)Formulario 300A de Cal/OSHA (Resumen anual)

The yearly summary of the injury and illness log. A company executive certifies it, and it is posted from February 1 to April 30.

California Family Rights Act (CFRA)Ley de Derechos de la Familia de California (CFRA)

A California law giving eligible employees of employers with 5 or more employees up to 12 workweeks of job-protected family and medical leave.

California Personal Income Tax (PIT) withholdingRetención del Impuesto sobre el Ingreso Personal (PIT)

California income tax the employer withholds from employee wages and reports to the EDD.

CapacityCapacidad

The legal ability to enter a contract. For example, minors and people of unsound mind may lack capacity.

Capital budgetPresupuesto de capital

A budget for major long-term purchases, such as trucks, equipment, or buildings.

Cash flowFlujo de efectivo

The money coming into and going out of a business over a period of time. A profitable company can still fail if it runs out of cash.

Cash flow projection (cash budget)Proyección de flujo de efectivo (presupuesto de efectivo)

A month-by-month estimate of cash coming in and going out. It shows future cash shortfalls early enough to plan for them.

Cash flow statement (statement of cash flows)Estado de flujo de efectivo

A report showing where cash came from and how it was used during a period, split into operating, investing, and financing activities.

Cash methodMétodo de caja

An accounting method that records income when cash is received and expenses when cash is paid.

Cashier's check (instead of a bond)Cheque de caja (en lugar de fianza)

A contractor may deposit a cashier's check with CSLB instead of a license bond. A person harmed must go to court to be paid from it.

Certificate of insuranceCertificado de seguro

A document from the insurer showing that a policy exists, with its limits and dates. Contractors often require one from each subcontractor.

Certificate of occupancyCertificado de ocupación

A document from the building department stating that a building is approved to be used or lived in.

Certified payroll records (CPR)Nómina certificada

Payroll records for each worker on a public works project, showing work classification, hours worked each day and week, and pay, certified under penalty of perjury (Labor Code §1776). Contractors submit them electronically to the Labor Commissioner at least monthly, or more often if the contract says so (§1771.4).

Certified renovatorRenovador certificado

A person trained by an EPA-accredited provider who directs lead-safe work practices on RRP jobs for a certified firm.

Change orderOrden de cambio

A written change to a contract's work, price, or schedule. On home improvement jobs, it must be in writing and signed by both parties.

Chart of accountsCatálogo de cuentas

The numbered list of all accounts in the ledger, grouped by type such as assets, liabilities, equity, revenue, and expenses.

CitationCitación

A written notice from an agency, such as CSLB or Cal/OSHA, that a law was broken. It can order the problem fixed and a fine paid.

Civil Rights Department (CRD)Departamento de Derechos Civiles (CRD)

The California agency that enforces laws against discrimination, harassment, and retaliation at work. It was formerly called DFEH.

Civil wage and penalty assessmentEvaluación civil de salarios y multas

A written finding by the Labor Commissioner of the wages and penalties a contractor owes for prevailing wage violations on a public work (Labor Code §1741).

Claim of lienReclamo de gravamen

The signed and verified document a claimant records with the county recorder to create a mechanics lien. A copy must also be served on the owner.

ClaimantReclamante

A person who has a right to record a mechanics lien, give a stop payment notice, or claim on a payment bond, such as an unpaid subcontractor, supplier, or worker (Civil Code §8004).

Class A: General Engineering ContractorClase A: contratista de ingeniería general

A contractor whose main business is fixed works that need special engineering knowledge and skill, such as roads, bridges, dams, and pipelines.

Class B: General Building ContractorClase B: contratista de construcción general

A contractor whose main business is structures that need at least two unrelated building trades or crafts. Framing and carpentry projects are not limited.

Class C: Specialty ContractorClase C: contratista especializado

A contractor whose work needs special skill in one trade, such as C-10 Electrical or C-36 Plumbing.

Classification codeCódigo de clasificación

A WCIRB code that describes the kind of work employees do. Each code has a rate that is applied to payroll to figure the workers' compensation premium.

CloseoutCierre de la obra

The final steps of a job, such as finishing the punch list, collecting lien releases and warranties, turning over as-built drawings, collecting retention, and preparing the final cost report.

Code of Safe PracticesCódigo de Prácticas Seguras

Written safety rules for construction work that each construction employer must adopt and post or keep at each job site.

Commercial auto insuranceSeguro comercial de autos

A business auto policy that covers liability and damage involving the company's trucks and other vehicles.

Commercial umbrellaParaguas comercial (umbrella)

Extra liability insurance that pays above the limits of the auto, general liability, and employer's liability policies.

Competent personPersona competente

Someone who can identify hazards on the job and has the authority to correct them right away.

Completed operations coverageCobertura de operaciones terminadas

Part of a commercial general liability policy that covers injury or property damage caused by work after it is finished.

Completed-contract methodMétodo de contrato terminado

A way to report all of a job's income and costs only when the job is finished.

CompletionTerminación

For lien deadlines on private works, completion means actual completion, owner occupation or use plus stopped work, 60 days of stopped work, or 30 days of stopped work plus a recorded notice of cessation (Civil Code §8180). Public works also count acceptance by the public entity.

Conditional waiver and releaseRenuncia y liberación condicional

A statutory lien waiver form that takes effect only when the payment is actually received, such as when the check clears (Civil Code §§8132, 8136). Owners collect it before making a payment.

ConsiderationContraprestación

Something of value each party gives or promises in a contract, such as money in exchange for work.

Construction lenderPrestamista de construcción

A bank or other lender that holds loan funds to pay for a construction project (Civil Code §8006). A claimant can give it a stop payment notice.

ContingencyContingencia (reserva para imprevistos)

Money added to an estimate or budget to cover unknown or unexpected costs.

ContractContrato

An agreement the law will enforce. A valid contract needs an offer and acceptance, something of value exchanged, a legal purpose, and parties able to agree.

ContractorContratista

A person or business that builds, changes, repairs, or improves a building or project, or offers or bids to do so. In California, this work usually needs a CSLB license.

Contractor-controlled insurance program (CCIP)Programa de seguro controlado por el contratista (CCIP)

A wrap-up insurance program bought and managed by the general or prime contractor.

Contractor's license bondFianza de contratista (fianza de garantía)

A $25,000 bond, or a cashier's check, that every licensee must file with CSLB before licensing. Consumers, employees, and others harmed by license law violations can make a claim against it.

Contractors State License Board (CSLB)Junta Estatal de Licencias de Contratistas (CSLB)

The California state agency that licenses and regulates contractors. It also investigates complaints and protects consumers.

CorporationCorporación

A business that is a legal entity separate from its owners, the shareholders. Owners are usually not personally responsible for its debts, and it must be registered with the Secretary of State.

Cost codeCódigo de costo

A number that identifies a work item, used in both the estimate and the accounting records so actual costs can be compared with the budget.

Cost-plus contractContrato de costo más honorarios

A contract in which the owner pays the actual costs plus a fee or percentage for overhead and profit.

County recorderRegistrador del condado

The county office where liens, notices of completion, and other property papers are recorded. Do not confuse it with the CSLB Registrar.

Critical pathRuta crítica

The longest chain of linked activities in a schedule. It sets the project length, its activities have zero float, and a delay to any of them delays the project.

Critical path method (CPM)Método de la ruta crítica (CPM)

A scheduling method that finds the longest chain of tasks that must happen in order. A delay to any task on the critical path delays the whole project.

Current assetsActivos corrientes (activo circulante)

Cash and other assets expected to turn into cash within one year, such as accounts receivable.

Current liabilitiesPasivos corrientes (pasivo circulante)

Debts due within one year, such as accounts payable and payroll taxes owed.

Current ratioRazón corriente (índice de liquidez)

Current assets divided by current liabilities. A ratio above 1 means the business has more current assets than current debts.

Daily log (daily report)Bitácora diaria (reporte diario)

A daily job record of workers, weather, work done, deliveries, visitors, and problems. It is key evidence in disputes.

DE 4 (Employee's Withholding Allowance Certificate)DE 4 (Certificado de Retención del Empleado)

The EDD form an employee fills out so the employer knows how much California Personal Income Tax to withhold.

DE 542 (Report of Independent Contractors)DE 542 (Informe de contratistas independientes)

The EDD report a business files for independent contractors it pays when a federal Form 1099-NEC or 1099-MISC is required for the services. It is due within 20 days after paying, or contracting to pay, that amount.

DE 88 (Payroll Tax Deposit)DE 88 (Depósito de Impuestos de Nómina)

The EDD deposit an employer uses to pay California payroll taxes: UI, ETT, SDI, and PIT.

DE 9 (Quarterly Contribution Return and Report of Wages)DE 9 (Declaración Trimestral de Contribuciones e Informe de Salarios)

The EDD quarterly return that reconciles an employer's California payroll taxes: UI, ETT, SDI, and PIT. It is filed with the DE 9C.

DE 9C (Quarterly Contribution Return and Report of Wages – Continuation)DE 9C (Informe trimestral de salarios por empleado)

The EDD quarterly report that lists each employee's wages and California tax withholdings.

DebarmentInhabilitación

A ban that keeps a contractor from bidding on or working on public works for a period of time, for example for willful prevailing wage violations.

Debt-to-equity ratioRazón de deuda a capital

Total liabilities divided by owner's equity. A higher number means the business depends more on borrowed money.

DeductibleDeducible

The part of a covered loss the insured pays before the insurance company pays.

Department of Industrial Relations (DIR)Departamento de Relaciones Industriales (DIR)

The California department that includes Cal/OSHA, the Labor Commissioner's Office, and the Division of Workers' Compensation.

Deposit in transitDepósito en tránsito

A deposit recorded in the company's books that does not appear on the bank statement yet. In a bank reconciliation, it is added to the bank balance.

Deposit schedule (monthly or semiweekly)Itinerario de depósitos (mensual o bisemanal)

The IRS rule for how often an employer deposits federal payroll taxes. It depends on the taxes reported during a past 12-month lookback period.

DepreciationDepreciación

Spreading the cost of a long-lasting asset, such as a truck or equipment, over its useful life as an expense.

Direct contractor (prime contractor)Contratista principal (contratista directo)

The contractor who has a contract directly with the property owner.

Direct costsCostos directos

Costs tied to one specific job, such as that job's materials, labor, equipment, and subcontracts.

Direct job costCosto directo del trabajo

A cost that can be traced to one job, such as field labor, materials, subcontracts, job equipment, and permits.

Direct labor costsCostos laborales directos

Wages paid for workers' time spent building a specific job.

Disciplinary bondFianza disciplinaria

An extra bond a contractor may need to have a license restored after disciplinary action.

Double timePago doble

Pay of at least 2 times the regular rate for work over 12 hours in a day, or over 8 hours on the seventh day of work in a workweek.

Double-entry bookkeepingContabilidad de partida doble

A bookkeeping system that records every transaction as at least one debit and one credit. Total debits must always equal total credits.

Down paymentPago inicial

Money paid before work starts. On a home improvement or swimming pool contract, it cannot be more than $1,000 or 10% of the contract price, whichever is less.

DWC 1 claim formFormulario de reclamo DWC 1

The workers' compensation claim form an injured worker uses to start a claim. The employer must give or mail it within one working day after learning of an injury that causes lost time or needs more than first aid.

DWC 7 notice to employeesAviso DWC 7 a los empleados

The required workers' compensation notice that employers must post where employees can easily read it. It explains workers' rights and names the insurer.

E-VerifyE-Verify

A federal online system that checks a new hire's Form I-9 information against government records. Most private California employers are not required to use it, and it may not be used to screen applicants before a job offer.

Earned value (EV)Valor ganado (EV)

The budgeted value of the work actually completed so far. Comparing it with actual cost shows whether a job is over or under budget.

EFTPS (Electronic Federal Tax Payment System)EFTPS (Sistema Electrónico de Pago de Impuestos Federales)

The free U.S. Treasury online system employers use to make federal tax deposits.

EmployeeEmpleado

A person who works for and under the control of an employer. Employees are owed wages, payroll tax coverage, and workers' compensation.

Employer Identification Number (EIN)Número de Identificación del Empleador (EIN)

A nine-digit IRS number that identifies a business on tax returns and payroll forms.

Employment Development Department (EDD)Departamento del Desarrollo del Empleo (EDD)

The California agency that collects state payroll taxes and runs the unemployment and disability insurance programs.

Employment discriminationDiscriminación en el empleo

Treating a worker or job applicant unfairly because of a protected trait, such as race, sex, religion, disability, national origin, or age 40 and over.

Employment Training Tax (ETT)Impuesto de Capacitación Laboral (ETT)

A California payroll tax paid by the employer that funds job training programs.

Errors and omissions (E&O) insuranceResponsabilidad profesional (errores y omisiones)

Professional liability insurance that covers claims of mistakes or missed duties in professional services, such as design work.

EscrowDepósito en garantía (escrow)

An arrangement in which a neutral third party holds money or securities until agreed conditions are met.

EstimateEstimación de costos

A calculation of the likely cost of a job, including materials, labor, equipment, subcontracts, overhead, and profit.

Estimated tax paymentsPagos de impuesto estimado

Tax payments made during the year by business owners and self-employed people who do not have enough tax withheld from pay.

Exam waiverExención del examen

Permission from the Registrar to skip a license exam, for example when the qualifier passed the same exams or was a qualifier in the same classification within the last five years. The Registrar decides each request.

Exclusive remedyRecurso exclusivo

The rule that workers' compensation is normally an injured employee's only remedy against an employer that has coverage, so the worker generally cannot sue that employer (Labor Code §3602).

Exempt employeeEmpleado exento

An employee, usually salaried in a management or professional job, who is not owed overtime. The employee must meet both a salary test and a duties test.

Exemption certificate (workers' compensation)Certificado de exención

A signed CSLB form in which a licensee certifies it has no employees, so it does not need workers' compensation coverage. Some classifications, such as C-8, C-20, C-22, and C-39, cannot use it.

Exigent circumstancesCircunstancias urgentes

A real emergency that allows an employer to report a serious injury or illness to Cal/OSHA up to 24 hours after learning of it, instead of 8 hours.

Experience modification (e-mod)Factor de modificación por experiencia (e-mod)

A number that raises or lowers a workers' compensation premium based on the employer's past claims. A better safety record usually means a lower e-mod.

Fair Employment and Housing Act (FEHA)Ley de Vivienda y Empleo Justos (FEHA)

California's main law against job discrimination, harassment, and retaliation. Its discrimination rules cover most employers with 5 or more employees, and its harassment rules cover all employers.

Fall protectionProtección contra caídas

Guardrails, safety nets, or personal fall arrest systems (harness, lanyard, and anchor) that keep workers from falling or stop a fall.

Federal income tax withholdingRetención del impuesto federal sobre los ingresos

Federal income tax the employer takes out of each paycheck and sends to the IRS, based on the employee's Form W-4.

Federal Unemployment Tax (FUTA)Impuesto Federal para el Desempleo (FUTA)

A federal tax paid only by the employer, not withheld from wages. It is reported once a year on Form 940.

Final paycheckPago final de salarios

A fired employee must be paid all wages right away. An employee who quits without 72 hours' notice must be paid within 72 hours.

Final paymentPago final

The last payment on a contract, usually made after the work is complete and accepted. Owners often get unconditional lien releases for earlier payments first.

Fixed assetsActivos fijos

Long-term assets used to run the business, such as trucks, tools, and buildings. Most of them are depreciated.

Fixed costCosto fijo

A cost that stays about the same in a period no matter how much work the business does, such as office rent.

Fixtures (sales and use tax)Accesorios fijos (impuesto sobre las ventas y el uso)

For CDTFA purposes, items that keep their identity after installation, such as air conditioning units and lighting or plumbing fixtures. The contractor is the retailer of fixtures.

FlaggerBanderero

A trained worker who directs traffic around a work zone when signs and barricades are not enough.

Float (slack)Holgura

How long a task can be delayed without delaying the project. Tasks on the critical path have zero float.

Flow-down clauseCláusula de traslado (flow-down)

A subcontract clause that binds the subcontractor to the duties in the prime contract, so the subcontractor should read the prime contract too.

Force majeureFuerza mayor

An event beyond the parties' control, such as a natural disaster, that a contract says will excuse or delay performance.

Form 1099-NECFormulario 1099-NEC

The IRS form a business files to report payments to nonemployees, such as independent contractors.

Form 5020 (Employer's Report of Occupational Injury or Illness)Formulario 5020 (Informe del Empleador sobre Lesión o Enfermedad Ocupacional)

The employer's report of a work injury or illness. It goes to the workers' compensation insurer, or to DIR if self-insured, within 5 days after the employer learns of it.

Form 940Formulario 940

The employer's annual federal unemployment (FUTA) tax return. It is generally due January 31.

Form 941Formulario 941 (Declaración del Impuesto Federal Trimestral del Empleador)

The quarterly federal return for withheld income tax and Social Security and Medicare taxes. It is due by April 30, July 31, October 31, and January 31.

Form I-9Formulario I-9 (Verificación de Elegibilidad de Empleo)

A federal form the employer completes for every new hire to check the worker's identity and permission to work in the United States.

Form W-2Formulario W-2 (Comprobante de salarios y retención de impuestos)

The yearly form showing an employee's wages and the taxes withheld. The employer gives it to the employee and files it with the government.

Form W-4Formulario W-4 (Certificado de Retenciones del Empleado)

The form an employee fills out so the employer knows how much federal income tax to withhold.

Franchise Tax Board (FTB)Junta de Impuestos de Franquicia (FTB)

The California agency that collects state income and franchise taxes from people and businesses.

Fringe benefitsPrestaciones suplementarias (beneficios adicionales)

Benefits paid in addition to wages, such as health care, pension, vacation, and training. Prevailing wage rates include them.

FUTA credit reductionReducción del crédito del FUTA

A cut in the credit an employer gets against FUTA tax when its state has not repaid a federal unemployment loan. It raises the employer's FUTA cost.

General and administrative (G&A) costsCostos generales y administrativos

Company-wide costs not tied to one job, such as office rent, office salaries, accounting, and sales vehicles. They are recovered through the markup on jobs.

General liability insuranceSeguro de responsabilidad civil general

Insurance that pays when the contractor's work injures other people or damages their property. It does not cover injuries to the contractor's own employees.

General partnerSocio general

A partner who helps run the business and is personally responsible for its debts. A general partner can be the license qualifier.

GHS labelEtiqueta GHS

A chemical container label in the global format, showing the product name, signal word, hazard statements, pictograms, precautionary statements, and supplier.

Good faith disputeDisputa de buena fe

An honest disagreement about payment. During one, the payer may withhold up to 150% of the disputed amount instead of paying it on time.

Gross paySalario bruto

An employee's total pay before taxes and deductions are taken out.

Gross profitGanancia bruta (utilidad bruta)

Revenue minus direct job costs, before overhead is subtracted.

Ground-fault circuit interrupter (GFCI)Interruptor de circuito por falla a tierra (GFCI)

A device that quickly cuts off power when electric current leaks to ground, to protect workers from shock.

Guaranteed maximum price (GMP)Precio máximo garantizado (GMP)

A cost-plus contract with a price ceiling. The owner pays actual costs plus the fee up to the cap, and the contractor pays any costs above it.

GuardrailBarandal

A rail system along an open side or edge that keeps workers from falling.

HarassmentAcoso

Unwelcome conduct based on a protected trait that creates a hostile or offensive workplace. Sexual harassment is one type.

HazardPeligro

Anything at work that can cause injury or illness, such as open edges, live electricity, or chemicals.

Hazard communication programPrograma de comunicación de peligros

The written program required under Title 8 §5194 for workplaces with hazardous substances. It covers container labels, safety data sheets, and worker training.

Hazardous materialsMateriales peligrosos

Substances that can harm people or the environment, such as asbestos, lead, silica dust, solvents, and fuels.

Hazardous substance removal certification (HAZ)Certificación para la eliminación de sustancias peligrosas (HAZ)

A CSLB certification a contractor needs to do hazardous substance removal work, such as removing underground storage tanks.

Hazardous wasteDesechos peligrosos

Leftover hazardous materials that must be stored, transported, and disposed of under special rules. They cannot go in the regular trash.

Heat Illness Prevention PlanPlan de Prevención de Enfermedades por Calor

The written plan an employer with outdoor workers must have under Title 8 §3395. It covers water, shade, cool-down rest, high-heat procedures, emergency response, and training; each worker must have at least one quart of water per hour.

High-heat proceduresProcedimientos para calor alto

Extra steps outdoor employers in construction and some other industries must take when it is 95°F or hotter, such as observing workers, keeping in contact, and holding pre-shift meetings.

Hiring entityEntidad contratante

The business or person that hires a worker. Under the ABC test, the hiring entity must prove a worker is an independent contractor.

Home improvement contractContrato de mejoras del hogar

A contract to repair, remodel, add to, or improve a home or residential property. When the total price of labor and materials is over $500, it must be in writing and include the terms the law requires.

Home improvement salesperson (HIS)Vendedor de mejoras del hogar (HIS)

A person who sells home improvement contracts for a contractor. The salesperson must be registered with CSLB to sign contracts for the contractor.

Inactive licenseLicencia inactiva

A license the licensee has placed on hold. The holder cannot do contracting work until the license is reactivated, but must still renew it.

Income statement (profit and loss statement)Estado de resultados (estado de pérdidas y ganancias)

A report of revenue, expenses, and profit or loss over a period of time, such as a month or a year.

Income taxImpuesto sobre el ingreso

Tax on a business's profit or a person's income, paid to the IRS and to California's Franchise Tax Board.

Indemnity (hold harmless)Indemnización

A contract promise by one party to pay for another party's losses or claims, often called a hold harmless clause. California voids construction clauses that make someone pay for the other party's sole negligence or willful misconduct (Civil Code §2782).

Independent contractorContratista independiente

A worker who is in business for themselves, not an employee. Calling someone an independent contractor does not make it true; the legal test decides.

Injury and Illness Prevention Program (IIPP)Programa de Prevención de Lesiones y Enfermedades (IIPP)

A written safety program every California employer must have and follow. It covers who is responsible, compliance, communication, hazard checks, accident investigation, fixing hazards, training, and records.

Inland marine (equipment floater)Marítimo terrestre (inland marine)

Property insurance for tools, equipment, and materials while they are moving or away from the main business location.

InsuranceSeguro

A contract in which one party agrees to pay another for loss, damage, or liability caused by an uncertain event (Insurance Code §22).

Itemized wage statement (pay stub)Talón de pago detallado

The written statement given with each paycheck that shows hours worked, pay rates, gross and net pay, and deductions.

Job costingCosteo por obra

Tracking the actual costs of each job and comparing them with the estimate. It shows which jobs make or lose money.

Job overhead (field overhead)Gastos generales de obra

Indirect costs of one job, such as a site trailer, temporary toilets, permits, and on-site supervision.

Joint checkCheque conjunto

A check made out to two payees, such as the contractor and a supplier. Both must sign it, which helps make sure lower-tier parties get paid.

Joint ventureEmpresa conjunta

Two or more licensees or businesses that combine to work together, often on one project. A joint venture needs its own joint venture license.

JournalDiario

The book where each business transaction is first recorded, in date order, from source documents such as invoices and checks.

Journeyman (journey level)Oficial (nivel de oficial calificado)

An experienced worker who is fully trained and can do the trade without supervision, or who finished an apprenticeship. Applicants need four years of journey-level or higher experience within the last 10 years.

Judgment bondFianza por sentencia

A bond equal to an unpaid construction-related court judgment. CSLB can require it before a license is renewed, reinstated, or issued when a licensee or its personnel have an unsatisfied judgment (B&P §7071.17).

Labor burdenCarga laboral

Costs an employer pays on top of wages, such as payroll taxes, workers' compensation, and benefits. It is often figured as a percentage of wages.

Labor Commissioner's Office (DLSE)Oficina del Comisionado Laboral (DLSE)

The state office that enforces wage and hour laws and prevailing wage laws on public works, and hears wage claims.

Labor productivityProductividad laboral

How much work a crew gets done for the labor used, such as units installed per labor hour or labor hours per unit.

LaborerTrabajador

A person who works on a project as an employee for wages (Civil Code §8024). A laborer has lien rights but does not need to give a preliminary notice.

Late payment penaltyMulta por pago tardío

A penalty of 2% per month on progress payments or retention that are wrongfully withheld, owed in place of ordinary interest.

Latent deficiencyDeficiencia latente

A hidden construction defect that a reasonable inspection would not reveal. A lawsuit for it must be filed within 10 years after substantial completion (CCP §337.15).

LeadPlomo

A toxic metal found in older paint and pipes. Work that disturbs lead paint requires lead-safe work practices and may require certification.

Ledger (general ledger)Libro mayor

The book that holds every account and its balance, posted from the journal. The general ledger holds all of a company's accounts.

LiabilitiesPasivos

Debts and obligations a business owes to others.

License classificationClasificación de licencia

The type of work a license allows, such as A, B, or a C specialty. A contractor must stay within the classifications on the license, with limited exceptions.

License renewalRenovación de la licencia

A license must be renewed every two years with a fee. Renewing after the expiration date costs more.

LienGravamen

A legal claim against property to secure payment of a debt. Until it is paid or released, a lien can block a sale or a new loan.

Lien date (property tax)Fecha de gravamen fiscal

12:01 a.m. on January 1. Property tax is based on the property a business owns, and its value, on that date.

Lien foreclosure actionAcción de ejecución hipotecaria del gravamen

A lawsuit to enforce a mechanics lien by forcing a sale of the property. It must be filed within 90 days after the lien is recorded.

Lien release (waiver and release)Liberación de gravamen

A signed form in which a claimant gives up lien rights for work that has been paid for. California law sets the exact forms to use.

Lien release bondFianza de liberación de gravamen

A bond for 125% of a lien claim that an owner or contractor records to release the property from the lien; the claimant then looks to the bond for payment (Civil Code §8424).

Limited liability company (LLC)Compañía de responsabilidad limitada (LLC)

A business that protects its owners (members) from personal liability, like a corporation. To be licensed, an LLC needs an extra worker bond and liability insurance.

Limited partnerSocio limitado (socio comanditario)

A partner who invests money but does not manage the business. Their risk is usually limited to the amount they invested.

Line of creditLínea de crédito

A bank arrangement that lets a business borrow up to a set limit when needed and pay interest only on what it uses.

Liquidated damagesDaños y perjuicios liquidados

A set amount, often per day, written into a contract that the contractor must pay if the job is finished late.

Live Scan fingerprintingHuellas dactilares por Live Scan (escaneo en vivo)

Electronic fingerprinting for a criminal background check by the California Department of Justice and the FBI. Applicants, officers, partners, owners, RMEs, and home improvement salespersons must be fingerprinted.

LLC employee/worker bondFianza para empleados/trabajadores de LLC

A $100,000 bond an LLC must file in addition to the $25,000 license bond. It protects workers who are owed wages or benefits.

LLC liability insuranceSeguro de responsabilidad civil para LLC

Liability insurance an LLC must carry to be licensed. The minimum starts at $1 million and is higher for LLCs with more listed personnel.

Lockout/tagoutBloqueo y etiquetado

Shutting off and locking energy sources, and tagging them, so machines or circuits cannot start while someone works on them.

Log 300 (injury and illness log)Registro 300 (registro de lesiones y enfermedades)

The log where employers record work-related injuries and illnesses. Some small or low-risk employers are exempt from keeping it.

Lookback periodPeríodo retroactivo

The four quarters from July 1 to June 30 of earlier years that the IRS uses to set an employer's federal deposit schedule for the next calendar year.

Lowest responsible bidderLicitante responsable con la oferta más baja

The bidder with the lowest price who is also qualified and whose bid meets the requirements. Many public works contracts go to this bidder.

Lump-sum (fixed-price) contractContrato a suma alzada (precio fijo)

A contract with one total price for all the work. The contractor takes the risk if costs run higher than expected.

MACRS (Modified Accelerated Cost Recovery System)MACRS (Sistema Modificado de Recuperación Acelerada de Costos)

The standard federal tax depreciation system, with set recovery periods for each type of property.

Mandatory arbitrationArbitraje obligatorio

CSLB arbitration the contractor must take part in when the damages are $25,000 or less and other conditions are met.

Margin (profit margin)Margen de ganancia

Profit stated as a percentage of the selling price. A $12,000 price with $2,000 profit is a margin of about 16.7%.

MarkupRecargo (markup)

An amount added to cost to set the selling price, stated as a percentage of cost. A $10,000 cost with a 20% markup sells for $12,000.

Materials (sales and use tax)Materiales (impuesto sobre las ventas y el uso)

For CDTFA purposes, items that lose their separate identity once installed in real property, such as lumber, cement, and wiring. The contractor is the consumer and owes tax on its cost.

Meal or rest period premiumPago de prima por período de comida o descanso

One additional hour of pay at the employee's regular rate for each workday a required meal or rest period is not provided (Labor Code §226.7).

Meal periodPeríodo de comida

An unpaid, duty-free break the employer must provide during longer workdays. A missed meal period can cost the employer an extra hour of pay.

Mechanics lienGravamen de constructor (gravamen por derechos de construcción)

A lien recorded against private property by an unpaid contractor, subcontractor, worker, or supplier who helped improve it. The owner may have to pay twice or have the property sold.

Mechanics Lien WarningAdvertencia de gravamen de constructor

A notice required in every home improvement contract that explains mechanics liens to the owner. Because it is in the contract, the direct contractor does not need to send a preliminary notice.

MediationMediación

A meeting where a neutral mediator helps the parties reach their own agreement. Unlike an arbitrator, the mediator does not make a binding decision.

Minimum wageSalario mínimo

The lowest hourly pay the law allows. Some cities and counties set a higher minimum wage than the state.

MisclassificationClasificación errónea

Treating an employee as an independent contractor. Willful misclassification brings civil penalties (Labor Code §226.8).

Monthly schedule depositorDepositante mensual

An employer that reported $50,000 or less of payroll taxes in the lookback period (and every new employer in its first year). It deposits each month's taxes by the 15th of the next month.

Net paySalario neto

Take-home pay after taxes and deductions are subtracted from gross pay.

Net profitGanancia neta (utilidad neta)

What is left after all costs, including overhead, are subtracted from revenue.

Notice of cancellationAviso de cancelación

The written notice a buyer uses to cancel. After a cancellation, the contractor must return any money paid within 10 days.

Notice of cessationAviso de cese de obra

A notice an owner may record after work on the project has stopped for a continuous period. Like a notice of completion, it shortens the time to record a lien.

Notice of completionNotificación de finalización

A notice the owner records with the county recorder within 15 days after the work is finished. It shortens the lien deadline to 60 days for the direct contractor and 30 days for subcontractors and suppliers.

Notice to Employee as to Change in RelationshipAviso al Empleado sobre Cambio en la Relación

A written notice the employer must give right away when an employee is discharged, laid off, or placed on leave. It tells the worker about possible unemployment benefits.

Notice to Schedule an ExaminationAviso para programar un examen

The notice CSLB sends after an application is accepted for testing. With it, the applicant schedules and pays for the exams with PSI.

Offer and acceptanceOferta y aceptación

A proposal by one party and agreement to its terms by the other. Together they show the mutual consent a contract needs.

Operating budgetPresupuesto de operación

A budget of the day-to-day revenue and expenses expected for the year.

Outstanding checkCheque pendiente

A check that has been written and recorded but has not cleared the bank yet. In a bank reconciliation, it is subtracted from the bank balance.

OverbillingFacturación en exceso

Billing more on a job than the revenue earned so far (billings in excess of costs and estimated earnings). It is a liability and is tracked job by job on the work-in-progress (WIP) schedule.

Overhead (general and administrative costs)Costos generales y administrativos (gastos generales)

Business costs not tied to one job, such as office rent, office salaries, utilities, and accounting. They are recovered through the markup on jobs.

OvertimeHoras extras (tiempo extra)

Pay of at least 1.5 times the regular rate for work over 8 hours in a day, over 40 hours in a workweek, and the first 8 hours on the seventh day of work in a workweek.

Owner-builderPropietario-constructor

A property owner who acts as their own contractor. Owner-builder experience can count only toward the B General Building classification.

Owner-controlled insurance program (OCIP)Programa de seguro controlado por el dueño (OCIP)

A wrap-up insurance program bought and managed by the project owner.

Owner's equity (net worth)Capital contable (patrimonio neto)

The owners' share of the business: total assets minus total liabilities.

PACE financingFinanciamiento PACE

Property Assessed Clean Energy: financing for energy or water upgrades that is repaid through the property tax bill. The California DFPI oversees PACE, and contractors who offer it must follow special rules.

PACE program administratorAdministrador del programa PACE

A company licensed and regulated by the California DFPI that runs PACE financing programs and enrolls the contractors and solicitors who offer PACE.

Paid sick leaveLicencia por enfermedad pagada

Paid time off that employees earn and can use when they or a family member are sick or need care.

PartnershipSociedad

A business owned by two or more people who share its profits and losses.

Pass-through entityEntidad de traspaso

A business whose profit is taxed on its owners' returns instead of to the business itself, such as a partnership, an S corporation, or most LLCs.

Patent deficiencyDeficiencia patente

A construction defect that a reasonable inspection would reveal. A lawsuit for it generally must be filed within 4 years after substantial completion, but this limit does not apply to an owner-occupied single-unit residence (CCP §337.1).

Pay-if-paid clauseCláusula de pagar solo si se cobra (pay-if-paid)

A subcontract clause that tries to make the owner's payment a condition of ever paying the subcontractor. In California, a contract cannot waive or impair another claimant's lien or payment rights (Civil Code §8122), so these clauses are risky to rely on.

Pay-when-paid clauseCláusula de pagar cuando se cobre (pay-when-paid)

A subcontract clause that sets when a subcontractor is paid based on when the prime contractor receives payment. It deals with timing, not whether the sub gets paid.

Payment bondFianza de pago

A bond promising the contractor will pay subcontractors, workers, and suppliers. It is common on public works, where liens against public property are not allowed.

PayrollNómina de sueldos

The record of employees and the wages, taxes, and deductions for each pay period. It also means the process of paying employees.

Payroll (premium) auditAuditoría de nómina (de prima)

The insurer's review of actual payroll and job classifications after the policy period to set the final workers' compensation premium.

Payroll recordsRegistros de nómina

Records of each employee's hours, wages, and taxes. Federal payroll tax records must be kept for at least four years.

Payroll tax liabilityResponsabilidad de la nómina de sueldos

The total payroll taxes an employer owes, including taxes withheld from workers and the employer's own share. The IRS uses this amount to set the employer's deposit schedule.

Per diem wagesSalarios por día

The full prevailing wage package for a craft: the basic hourly rate plus employer payments for health care, pension, vacation, training, and similar benefits (Labor Code §1773.1).

Percentage-of-completion methodMétodo de porcentaje de terminación

A way to report income on a long job little by little, based on how much of the job is done.

Performance bondFianza de cumplimiento

A bond promising the contractor will finish the work as the contract requires. If the contractor fails, the surety must pay or arrange to finish the job.

Performance evaluationEvaluación del desempeño

A regular written review of how well an employee does the job, used for feedback, training, and pay decisions.

Permissible exposure limit (PEL)Límite de exposición permisible (PEL)

The most exposure to a substance a worker may have, usually measured as an 8-hour time-weighted average.

Permit to employ (work permit)Permiso para trabajar

A permit, usually issued by the minor's school, that an employer must have before employing a minor under 18.

Personal fall arrest systemSistema personal para detener caídas

An anchorage, connectors, and a full body harness that together stop a worker who is falling.

Personal protective equipment (PPE)Equipo de protección personal (EPP)

Gear worn to protect workers, such as hard hats, safety glasses, gloves, and respirators. The employer must provide required PPE.

Personnel fileExpediente de personal

The employer's file of records about an employee's job, such as the application, evaluations, and discipline. Employees have the right to inspect it.

Petty cashCaja chica

A small, fixed fund of cash for minor purchases. Each payment is backed by a slip or receipt, and the fund is refilled to its set amount.

Plans and specificationsPlanos y especificaciones

Plans are drawings that show what to build and where. Specifications describe the materials, quality, and methods in writing.

Preconstruction meetingJunta previa a la construcción

A meeting before work starts to confirm contacts, schedules, procedures, and ground rules for the job.

PredecessorActividad predecesora

An activity that must finish before another activity can start.

Preliminary noticeNotificación preliminar (aviso preliminar)

A notice a subcontractor or supplier gives to keep the right to record a lien; it is not a lien itself. It should be given within 20 days after starting work or delivering materials.

PremiumPrima

The price paid for an insurance policy. Workers' compensation premiums are based on payroll and the type of work.

Presumed asbestos-containing material (PACM)Material que se presume con asbesto (PACM)

Thermal system insulation and surfacing material in buildings built no later than 1980. It must be treated as asbestos unless testing proves otherwise.

Prevailing wagesSalarios prevalecientes

The minimum hourly wages and benefits that the DIR sets for each trade and area for public works. Contractors must pay at least these rates.

Preventative cool-down restDescanso para refrescarse (descanso preventivo)

A rest in the shade of at least 5 minutes, not counting the time to get there, that a worker may take to prevent overheating.

Prime contractorContratista principal

The contractor that contracts directly with the owner or the public agency awarding the job. It may hire subcontractors for parts of the work.

Progress billingFacturación por avance

Billing the customer at set times, usually monthly, for the work completed during that period.

Progress paymentPago parcial (pago por avance de obra)

A payment made during the job for the work completed so far.

Progressive disciplineDisciplina progresiva

Discipline steps that get stronger each time, such as a verbal warning, a written warning, suspension, and then termination.

Project managerGerente de proyecto

The person responsible for a project's budget, schedule, contracts, and communication with the owner.

Project permit (Cal/OSHA)Permiso de proyecto (Cal/OSHA)

A Cal/OSHA permit for permit-required work, such as certain deep trenches or tall scaffolds, at one named job site.

Prompt paymentPago puntual

Rules on how fast contractors must pay subcontractors. A contractor must pay a subcontractor within 7 days after receiving a progress payment, unless they agreed otherwise in writing.

Proposition 65Proposición 65

A California law that requires businesses with 10 or more employees to give clear warnings before exposing people to listed chemicals that can cause cancer or reproductive harm.

Protective systemSistema de protección

A method that protects workers in an excavation from cave-ins, such as sloping, benching, shoring, or shielding (trench boxes).

Public worksObras públicas

Construction, alteration, demolition, installation, or repair work paid for in whole or in part with public funds. Prevailing wage laws usually apply.

Public works contractor registrationRegistro de contratistas ante el DIR

Contractors and subcontractors must register with the DIR each year before bidding on or doing most public works.

Punch listLista de pendientes (punch list)

A list of small items that must be fixed or finished before the job is closed out and final payment is made.

Purchase order (PO)Orden de compra

A written order to a supplier that states the item, quantity, price, delivery, and the job and cost code.

Qualified personPersona calificada

A person who, by degree, certificate, training, or experience, can do or supervise a specific task or solve problems related to it.

Qualifying individual (qualifier)Persona calificada (calificador)

The person whose experience and exam results qualify a business for its license. The qualifier must directly supervise and control the construction work.

Quantity takeoffCuantificación de materiales (takeoff)

Measuring the plans to count the materials and work needed. It is an early step in preparing an estimate.

Quick ratio (acid-test ratio)Razón rápida (prueba ácida)

Cash, marketable securities, and accounts receivable divided by current liabilities. Unlike the current ratio, it leaves out inventory.

Reasonable accommodationAdaptación razonable

A change to a job or workplace that helps a qualified worker with a disability do the job, unless it would cause undue hardship for the employer.

ReciprocityReciprocidad

An agreement with another state that lets CSLB waive the trade exam for a contractor licensed there in good standing for the past five years. The Law and Business exam is still required unless passed within five years.

Record retentionConservación de registros

Keeping required business and employment records for at least the minimum time the law sets, such as payroll, personnel, and injury records.

Regional notification center (811)Centro regional de notificación (811)

Before digging, an excavator must contact the 811 regional notification center at least two working days, and no more than 14 calendar days, ahead so buried utility lines can be marked.

Registrar of ContractorsRegistrador de contratistas

The CSLB officer who runs the licensing program. The Registrar can approve or deny licenses, waive exams in some cases, and take action against a license.

Regular paydayDía de pago regular

The day, set in advance, when wages are paid. Most California workers must be paid at least twice a month on designated paydays (Labor Code §204).

Regular rate of payTarifa regular de pago

The hourly rate used to figure overtime and break premiums. It includes most pay for the work, such as hourly wages, piece rates, and nondiscretionary bonuses.

Release bond (stop payment notice)Fianza de liberación

On a public work, a bond for 125% of a stop payment notice claim. When it is filed, the public entity can release the funds it was holding back (Civil Code §9364).

Release orderOrden de liberación

A court order that releases a property from a mechanics lien, for example when the claimant did not file a foreclosure lawsuit in time (Civil Code §8480).

Report of New Employee(s) (DE 34)Reporte de Nuevos Empleados (DE 34)

A report the employer sends to the EDD for each new or rehired employee no later than 20 days after the first day of work.

Request for information (RFI)Solicitud de información (RFI)

A written question to the designer or owner to clear up something unclear in the plans or specifications.

RescissionRescisión

Undoing a contract so the parties go back to where they were before, usually by returning what each received.

Respirable crystalline silicaSílice cristalina respirable

Very fine dust made when cutting, grinding, or drilling concrete, stone, or masonry. Breathing it can cause silicosis and other serious lung disease, so dust controls are required.

RespiratorRespirador

A mask that protects workers from breathing dust, fumes, or gases. Workers need a medical evaluation, fit test, and training before using a required respirator.

Responsible managing employee (RME)Empleado gerente responsable (RME)

A permanent employee who serves as a license qualifier. The RME must work at least 32 hours per week, or 80% of the hours the business is open, whichever is less.

Responsible managing member or managerMiembro administrador responsable o gerente administrador responsable

An LLC member or manager who serves as the qualifier for the LLC's license.

Responsible managing officer (RMO)Oficial gerente responsable (RMO)

An officer of a corporation or LLC who serves as the qualifier for its license.

Rest periodPeríodo de descanso

A short paid break during the workday that California wage rules require.

RetaliationRepresalias

Punishing a worker for a protected act, such as reporting a safety hazard or filing a wage complaint. It is illegal.

Retention (retainage)Retención (retenido)

A portion of each progress payment held back until the job is finished, to make sure the work is completed. The law sets deadlines for releasing retention.

RevenueIngresos

The total money earned from work before any costs are subtracted.

Safety data sheet (SDS)Hoja de datos de seguridad (SDS)

A document from a chemical's maker that explains its hazards, safe handling, protective gear, and first aid. Employers must keep SDSs available to workers.

Sales and use taxImpuesto sobre las ventas y el uso

State and local tax on the sale or use of goods, managed by the California Department of Tax and Fee Administration (CDTFA). Contractors usually owe it on the materials they install.

Salvage valueValor de rescate

The estimated value of an asset at the end of its useful life. Straight-line depreciation spreads cost minus salvage value over the years of use.

ScaffoldAndamio

A temporary raised work platform. It must be set up, moved, and taken down safely under proper supervision.

Schedule of progress paymentsCalendario de pagos parciales

The part of a home improvement contract that lists each progress payment in dollars and cents and the work or materials it pays for. Payments must not get ahead of the value of the work done.

Scope of workAlcance del trabajo

The detailed description of the work, materials, and equipment in a contract. A clear scope helps prevent disputes.

Secretary of StateSecretario de Estado

The California office where corporations and LLCs register. They must be active and in good standing there to hold a contractor's license.

Section 179 deductionDeducción de la Sección 179

A federal tax election to deduct the cost of qualifying equipment in the year it is placed in service, instead of depreciating it over several years, up to a yearly dollar limit.

Security interestGarantía sobre la propiedad

A lien or other legal claim on property that secures payment of a debt. A home improvement contract of $5,000 or less may not provide for one in real property, other than a mechanics lien (B&P §7159.2).

Self-employment taxImpuesto sobre el trabajo por cuenta propia

Social Security and Medicare tax that sole proprietors and partners pay on their business earnings.

Self-insuranceAutoseguro

State approval for an employer to pay its own workers' compensation claims instead of buying a policy.

Seller's permitPermiso de vendedor

A CDTFA permit needed to sell taxable goods in California, for example when a contractor sells materials or fixtures separately from installation.

Semiweekly schedule depositorDepositante bisemanal

An employer that reported more than $50,000 of payroll taxes in the lookback period. It deposits by Wednesday or Friday, depending on the payday.

Senior citizenPersona mayor

For home improvement cancellation rights, a person 65 years of age or older, who gets five business days to cancel instead of three (Civil Code §1689.5).

Serious injury or illnessLesión o enfermedad grave

A work injury or illness that needs inpatient hospitalization for more than observation, or causes an amputation, the loss of an eye, or serious permanent disfigurement; as of 2026 it also includes silicosis and silica-related lung cancer (Labor Code §6302(h)). The employer must report it to Cal/OSHA immediately, and no later than 8 hours after learning of it.

Service and repair contractContrato de servicio y reparación

A contract for emergency or quick repairs the consumer requested. The three- or five-day right to cancel ends once the contract is signed and work begins.

Sexual harassment prevention trainingCapacitación para la prevención del acoso sexual

Employers with 5 or more employees must give at least 2 hours of training to supervisors and 1 hour to other employees, every two years.

Simple interestInterés simple

Interest figured only on the original amount borrowed: principal × annual rate × time in years.

Small claims courtTribunal de reclamos menores

A simple, low-cost court for smaller money disputes. The parties usually speak for themselves, and lawyers generally cannot represent them at the hearing.

Social Security and Medicare taxes (FICA)Impuestos del Seguro Social y del Medicare (FICA)

Federal taxes shared by employer and employee. The employer withholds the employee's share from wages and pays a matching employer share.

Solar energy system disclosure documentDocumento de divulgación del sistema de energía solar

The CSLB disclosure that must be on the front or cover page of a contract to sell, finance, or lease a residential solar energy system (B&P §7169). It shows the total cost, payments, and the buyer's cancellation rights.

Sole proprietorshipNegocio personal (propietario único)

A business owned by one person that is not a corporation or LLC. The owner is personally responsible for all business debts.

Spoil pileTierra excavada (spoil pile)

The pile of soil taken out of an excavation. It must be kept at least 2 feet back from the edge.

State Compensation Insurance Fund (State Fund)State Compensation Insurance Fund (State Fund)

A workers' compensation insurer created by the state that must be available to California employers. It competes with private insurers.

State Disability Insurance (SDI)Seguro Estatal de Incapacidad (SDI)

A California payroll tax withheld from employee wages. It pays benefits for illness or injury not caused by work, pregnancy, and Paid Family Leave.

Statute of fraudsLey contra el fraude (statute of frauds)

The rule that certain contracts must be in writing and signed to be enforced, such as agreements that cannot be performed within one year (Civil Code §1624).

Statute of limitationsPlazo de prescripción

The legal deadline to file a lawsuit or complaint. For example, consumers generally have four years to file a complaint with CSLB about defective work.

Stop orderOrden de alto

An order that bars an employer from using employee labor until it has workers' compensation coverage. The Director of Industrial Relations, through the Labor Commissioner, issues it under Labor Code §3710.1 (the CSLB Registrar has a similar power over contractors under B&P §7127); breaking it is a misdemeanor with up to 60 days in county jail, a fine up to $10,000, or both.

Stop payment noticeAviso de suspensión de pago

A notice from an unpaid claimant telling the owner, construction lender, or public agency to hold back money owed to the contractor. On public works, it is used instead of a mechanics lien.

Straight-line depreciationDepreciación en línea recta

Depreciation of the same amount every year: cost minus salvage value, divided by the years of useful life.

SubcontractSubcontrato

A contract between a contractor and a subcontractor for part of the work.

SubcontractorSubcontratista

A contractor hired by another contractor, not by the owner, to do part of the work. A subcontractor must be licensed for the work it does.

Subcontractor listingLista de subcontratistas

On public works, a prime bidder must list certain subcontractors in the bid. A listed subcontractor generally cannot be replaced without the awarding agency's approval.

Subject employerEmpleador sujeto

An employer that pays more than $100 in wages in a calendar quarter. It must register with the EDD and pay California payroll taxes.

SubmittalDocumentos para aprobación (submittal)

Shop drawings, product data, or samples a contractor sends to the designer or owner for approval before installing.

SubrogationSubrogación

The right of an insurer that paid a loss to collect from the party who caused it. A waiver of subrogation gives up that right against a named party.

Substantial completionTerminación sustancial

The point when the work is complete enough for the owner to use it for its purpose, even if small items remain.

Substitution of securitiesSustitución de valores

A public works option that lets the contractor deposit approved securities, with the agency or an escrow agent, in place of cash retention (PCC §22300).

SuperintendentSuperintendente

The person who runs the daily field work on a job site and directs crews and subcontractors.

SuretyCompañía de garantía (fiador)

The company that issues a bond and pays valid claims. The contractor must then pay the surety back.

Tailgate (toolbox) safety meetingReunión de seguridad (charla de seguridad)

A short safety meeting on the job site. Construction supervisors must hold one with their crews at least every 10 working days.

Target housingVivienda objetivo

Housing built before 1978, with limited exceptions, that is covered by the EPA lead Renovation, Repair, and Painting (RRP) rule.

Three-day right to cancelDerecho de cancelación de tres días

A buyer's right to cancel certain home improvement contracts within three business days, or five business days if the buyer is 65 or older. It does not apply if the contract was negotiated at the contractor's place of business.

Three-way matchConciliación de tres documentos

Comparing the supplier's invoice, the purchase order, and the signed delivery ticket before paying a bill.

Time-and-materials contractContrato por tiempo y materiales

A contract that pays hourly labor rates plus the cost of materials, often with a markup.

Tolerance zoneZona de tolerancia

The area 24 inches on each side of the outside edge of a buried utility's marking. Only hand tools may be used to find the line within it.

Trench and excavationZanja y excavación

A trench is a narrow dig that is deeper than it is wide; an excavation is any cut or hole in the earth. Cave-ins are a major danger, so protective systems like shoring are required.

Trigger task (lead)Tarea de activación (plomo)

A lead construction task listed in Title 8 §1532.1, such as manual scraping or using a heat gun, that requires interim worker protection until exposure is measured.

Trust fund recovery penaltyMulta de recuperación del fondo fiduciario

An IRS penalty equal to 100% of unpaid withheld taxes. It can be charged personally to each responsible person who willfully failed to pay them.

Trust fund taxesImpuestos de fondo fiduciario

Taxes an employer withholds from employees' pay, such as income tax and the employees' share of Social Security and Medicare. The employer holds this money in trust for the government and must never use it to run the business.

Unconditional waiver and releaseRenuncia y liberación incondicional

A statutory lien waiver form that takes effect as soon as it is signed and delivered, even if the payment never arrives (Civil Code §§8134, 8138). Sign it only after you have been paid.

UnderbillingFacturación insuficiente

Revenue earned on a job that has not been billed yet (costs and estimated earnings in excess of billings). It is an asset and can be a sign of slow billing.

Unemployment Insurance (UI)Seguro de Desempleo (UI)

A California payroll tax paid by the employer. It funds benefits for workers who lose their jobs through no fault of their own.

Uninsured Employers Benefits Trust Fund (UEBTF)Fondo Fiduciario de Beneficios de Empleadores sin Seguro (UEBTF)

A state fund that pays workers' compensation benefits to workers whose employers illegally had no coverage. The state then goes after the uninsured employer to pay it back.

Unit costCosto unitario

Total cost divided by the number of units, such as cost per square foot, per cubic yard, or per fixture.

Unit-price contractContrato de precio unitario

A contract that pays a set price per unit, such as per cubic yard or linear foot, times the quantity installed.

Unjust enrichmentEnriquecimiento injusto

Keeping a benefit, such as finished work, without paying for it when fairness requires payment. It can be a basis for recovering the value of the work.

Unknown materialsMateriales desconocidos

Materials found on a job whose contents are not known. Stop work around them and have them identified or tested before disturbing them.

Unlicensed contractorContratista sin licencia

Someone who does work that needs a contractor's license without having one. It is illegal and can bring fines, criminal charges, and trouble getting paid.

Use taxImpuesto sobre el uso

A California tax on using, storing, or consuming property in the state when sales tax was not paid on the purchase, such as materials bought from an out-of-state seller.

Utilization (equipment)Utilización

The hours per year a piece of equipment actually works on paying jobs. Low utilization raises the true cost per hour of owning it.

Variable costCosto variable

A cost that goes up or down with the amount of work, such as materials.

VarianceVariación

The difference between the budgeted amount and the actual amount. When actual cost is higher than budget, the job is over budget.

Vested vacationVacaciones adquiridas

Vacation time an employee has already earned. Unused vested vacation must be paid at the final rate when employment ends (Labor Code §227.3).

Waiting time penaltyMulta por tiempo de espera

A penalty of one day's wages for each day final pay is willfully late, for up to 30 days (Labor Code §203).

WarrantyGarantía

A written promise about the quality of work or materials for a set period of time.

WithholdingRetención

Amounts an employer takes out of an employee's wages, such as income tax, Social Security, Medicare, and SDI, and pays to the tax agencies for the employee.

Work of improvementObra de mejora

The whole construction project on a property, such as building, altering, repairing, or demolishing a structure, or improving the site (Civil Code §8050).

Work-in-progress (WIP) scheduleReporte de obras en proceso (WIP)

A report of open jobs showing contract amounts, costs to date, percent complete, earned revenue, billings, and overbilling or underbilling.

Workers' compensation certification (Labor Code §1861)Certificación de compensación de trabajadores (§1861)

A signed statement a public works contractor files with the awarding body before starting work, confirming it knows and will follow the law requiring workers' compensation coverage.

Workers' compensation exemptionExención del seguro de compensación de trabajadores

A statement filed with CSLB that the contractor has no employees. Some classifications, such as C-8 Concrete and C-39 Roofing, cannot use this exemption.

Workers' compensation insuranceSeguro de compensación de trabajadores

Insurance that pays medical care and lost wages for employees hurt or made sick by their work. California employers must have it or be approved to self-insure.

Working capitalCapital de trabajo

Current assets minus current liabilities. It shows how much money is available to run daily operations.

Workplace Violence Prevention PlanPlan de Prevención de Violencia en el Lugar de Trabajo

A written plan most California employers have been required to have and follow since July 1, 2024, including training and a violent incident log (Labor Code §6401.9).

WorkweekSemana laboral

Any seven consecutive days, starting on the same calendar day each week (Labor Code §500). Weekly overtime is counted within the workweek.

Wrap-up insuranceSeguro consolidado (wrap-up)

One insurance policy or program that covers a project's risks for two or more of the contractors and subcontractors working on it.