LBExamCSLB does not publish how many questions are on the Law and Business exam, and it does not publish the score that passes. It does publish the shape of the paper, in the free study guide for the exam, and that is the document to plan from. The guide divides the paper into seven sections and gives each one a share of it, with its own note that the percentages are approximate.
| Section | Share |
|---|---|
| Contract Requirements and Execution | 21% |
| Employment Requirements | 20% |
| Business Finances | 15% |
| Safety | 14% |
| Business Organization and Licensing | 13% |
| Insurance and Liens | 12% |
| Public Works | 5% |
Two sections are two fifths of the paper between them. Public Works is one twentieth. That ordering is the first thing to do something about, because the study guide prints the sections in a different order from the one they are weighted in, and reading it top to bottom puts the heaviest section fifth.
Contract Requirements and Execution, 21 percent
The guide lists bidding, cost control, project organization, contracts and payments under this heading. In practice it is the most heavily specified area of the license law: the home improvement contract rules in Bus. & Prof. Code s. 7159 run to pages of required content, down to the type size a notice is printed in, and s. 7030 requires a specified notice about CSLB in at least 10-point type on the written contracts of a prime contractor.
The consequence rules belong here too. Section 7031 is the one every contractor has heard of and few can state: an unlicensed person cannot bring or maintain an action in any California court to collect compensation for work where a license was required, whatever the merits of the claim.
Employment Requirements, 20 percent
Hiring, supervising and training employees, evaluation and record-keeping, and payroll. Almost none of this sits in the contractors law. The sources are the Labor Code and the two employer guides the study guide names, the EDD California Employer’s Guide and IRS Circular E, and the questions ask which deposit is due when, what has to be recorded, and how long it is kept.
One hook does reach back into the license law: s. 7125 makes a current and valid Certificate of Workers’ Compensation Insurance, or a Certification of Self-Insurance, a condition of issuing, reinstating, reactivating, renewing or continuing a license at all.
Business Finances, 15 percent
Cash management, budget and planning, taxes, financial reporting. This is the most practice-heavy section on the paper and the least of it is statute. The study guide’s own sample questions make the point: one asks what determines how often payroll deposits are made to the IRS, and another asks which account the depreciation on a car bought for the sales staff is charged to. Neither has a code section behind it. They are accounting questions asked of a contractor.
Safety, 14 percent
Training and reporting requirements, general safety, and hazardous or unknown materials. The source is Title 8 of the California Code of Regulations, the Cal/OSHA safety orders, which the study guide names in both its general industry and construction forms.
The license law joins in at s. 7110, which makes willful or deliberate disregard of the state’s building laws, and of the specific provisions it lists, a cause for disciplinary action against a licensee.
Business Organization and Licensing, 13 percent
Company organization, licensing requirements, advertising and subcontracting. The exemptions repay study as much as the rule does: s. 7048 puts work under $1,000 in aggregate contract price outside the chapter entirely, where the work is casual, minor or inconsequential and needs no building permit.
Who may qualify a license is in s. 7065, which is where the responsible managing officer, manager, member and employee all come from, and which sets out how each form of business qualifies by examination.
Insurance and Liens, 12 percent
Workers’ compensation insurance, business insurance, and liens and other remedies. Two bodies of law meet here. The contractor’s bond is s. 7071.6, a $25,000 bond required as a condition precedent to issuing, reinstating, reactivating, renewing or continuing a license. The lien and stop-payment remedies are Civil Code territory, and they run on deadlines a closed-book exam is built to test.
Public Works, 5 percent
The smallest section, and the most self-contained: prevailing wage requirements, bonding requirements, insurance requirements. The whole section covers what changes when the customer is a public agency, and the source is the Labor Code with the Department of Industrial Relations Public Works Manual beside it.
At a twentieth of the paper this is not the place to spend a week. It is also the section a candidate is least likely to have worked in, which makes it worth a read rather than nothing at all.
What the guide does not tell you
The percentages are approximate, by the guide’s own note, so treat a five percent section as a section that could be a question or two either side. And the guide’s three sample questions are examples of the form rather than a syllabus: CSLB says its questions are written and reviewed by licensed contractors actively working in the trade, which is a fair description of why the finance section reads like a bookkeeping exam.
Sources
- Law and Business study guide, form 13E-LAW rev. 03-2026, CSLB
- Contractors State License Law, Business and Professions Code, Division 3, Chapter 9
- Get Licensed to Build, CSLB