If you’re looking to become a farm labor contractor in California, you first need to get a Farm Labor Contractor License (FLC). Not sure how to get one? Then you’re in the right place! In this article, we’ll walk you through the process of obtaining your license and cover specifics about the California Farm Labor Contractor Bond. You will learn everything you need to know, including what requirements you must meet and what documentation to submit. So if you’re ready, let’s get started!

Who needs a California Farm Labor Contractor License?

A California Farm Labor Contractor License, also known as an FLC License, is required by the CA Department of Industrial Relations, Division of Labor Standards Enforcement, for anyone engaged in the business of farm labor contracting in the state. California law defines farm labor contractors as individuals or legal entities who recruit, supply, or hire workers for the production of farm products for a fee. For instance, persons or businesses that employ people to perform work connected to the production of farm products for a third party and who receive compensation for that service. The definition also includes any person or entity which provides board, lodging, or transportation for farm workers. This definition, however, does not include entities such as commercial packing houses engaged in harvesting and packing citrus or soft fruit for a client.

How to become a licensed farm labor contractor

Becoming a licensed farm labor contractor in California is not inherently complicated. Below are the primary steps that you’ll need to complete to get your license.

Step 1: Complete at least nine hours of relevant education classes for each license period.

You must complete a minimum of nine hours of education from an accredited institution for each license period. The classes must be relevant to your business, such as farm labor contracting, agricultural safety, workers’ compensation, first aid, and sexual harassment prevention.

Step 2: Take and pass the farm labor contractor exam (once every two years).

You must pass the farm labor contractor examination administered by the Division of Labor Standards Enforcement. The exam is given once every two years and covers topics such as California labor law, agricultural safety, workers’ compensation, and first aid.

Step 3: Obtain workers’ compensation insurance.

Another step to getting your license is to get workers’ compensation insurance for all your employees. You must obtain this insurance from an authorized insurer and maintain it for the duration of your license period.

Step 4: Obtain a Farm Labor Contractor License Surety Bond in the appropriate bond amount.

The next step is to obtain an FLC surety bond from a surety company licensed to do business in California. This bond must be effective for the duration of your license period. See below for more information.

Step 5: Download and fill out the FLC application.

Once you have completed the above steps, you can download and fill out the Farm Labor Contractor License application from the Division of Labor Standards Enforcement website.

Step 6: Gather additional required documentation.

For example, you may need the following:

• Two current passport photos and fingerprints taken for the sole proprietor, for one member of an LLC/corporation, or for EACH partner in a partnership. Fingerprints must be taken at a LiveScan facility.
• The sole proprietor or each officer of a corporation/LLC or each member of a partnership must fill out a sexual harassment disclosure statement.
• If your business is a Corporation or LLC, you will need to provide copies of your articles of incorporation statements of information.
• If required, register with the federal government as a farm labor contractor and receive a federal registration certificate.

Step 7: Submit your completed application and pay all required fees.

Include any required documentation, and submit your application to the California Labor Commissioner’s Office.

Please note that you must also register in each county that your business will dispatch workers.

What is a Farm Labor Contractor Bond?

The California Farm Labor Contractor Bond is a type of surety bond required by the California Department of Industrial Relations. As previously mentioned, to obtain a Farm Labor Contractor License, you have to purchase this particular bond.

A Farm Labor Contractor Bond, also called a farm contractor, farm labor, or migrant worker surety bond, is designed to ensure that farm labor contractors comply with California labor laws. Unlike liability insurance, which protects the employer, an FLC Bond protects workers from wage theft. In other words, a Farm Labor Bond guarantees payment of wages and other sums that are due to farm laborers.

There are three parties involved in a Farm Labor Bond. These are:

• The principal – the contractor required to obtain the bond;
• The obligee – the entity requiring the bond, in this case, the State of California Department of Industrial Relations; and
• The surety company – the company that writes the bond.

For new contractors, the bond amount typically starts at $25,000. However, the bond amount you will need for renewals depends on the size of your annual payroll for all employees, as established by CA Labor Code Section 1684(a)(3). For instance, if your payroll is $500,000 or less, you must have a bond amount of $25,000. Contractors with a payroll between $500,000 and $2 million will need a $50,000 bond, and those with a payroll in excess of $2 million will need a $75,000 bond.

How does this bond work?

If a farm labor contractor refuses or fails to pay wages or other benefits to a worker, that worker can file a claim against the licensed contractor’s bond. When the surety investigates the claim, they will determine its validity. If the claim is legitimate, the surety company will compensate the worker for what they are owed, up to the bond amount. Bonding differs from typical insurance because the contractor is financially responsible for reimbursing the surety company for all claims paid out, including any additional legal costs and fees.

How much does a CA Farm Labor Contractor Bond cost?

The cost of a California Farm Labor Contractor Bond will depend on several factors, including your credit (using a soft credit check) and a combination of different business information. Fortunately, your premium will not be the same as your required bond amount. Rather, you will pay a percentage of the bond amount.

Contractors with optimal credit and business financials may find quotes starting at as little as 1% of their required bond amount. Individuals with nonstandard credit are still encouraged to apply for their free quote.

Apply for your bond today

The best way to get an exact quote for your California Labor Contractor Bond is to apply online with South Coast Surety today! Fill out the short application on our website, or call us with your questions at 949-361-1692 or email apps@southcoastsurety.com. Our surety experts are here to help you with all your bonding needs.

Key Takeaways

• A California Farm Labor Contractor License, also called an FLC License, is required for anyone engaged in the business of farm labor contracting in the state.
• The steps required to obtain a California Farm Labor Contractor License include fulfilling an education and exam requirement, obtaining worker’s compensation insurance, obtaining a Farm Labor Contractor Bond, filling out a license application, and paying all required fees.
• The Farm Labor Contractor Bond is necessary to protect workers from wage theft by ensuring that farm labor contractors comply with California labor laws.
• For new contractors, the bond amount for their first year is usually $25,000. After that, renewal bonds are issued based on the company’s annual payroll with a bond amount of either $25,000, $50,000, or $75,000.
• Contractors with excellent credit and strong business financials may see quotes starting as low as 1% of the bond amount.