CA SB597

For private construction contracts entered into on or after January 1, 2026, direct contractors are liable for any unpaid wages, fringe benefits, penalties, liquidated damages, and interest owed by subcontractors at any tier for labor performed on the project

The definition of "direct contractor" is expanded for contracts starting January 1, 2026 to include contractors with relationships to any person or entity engaging contractors on behalf of an owner, not just those with direct contractual relationships to owners

Direct contractors can avoid liability for unpaid fringe benefit contributions by making joint check payments payable to both the subcontractor and the applicable trust, plan, fund, or program after receiving notice of the subcontractor's delinquency

Joint labor-management cooperation committees established under federal law are granted standing to sue construction contractors for failure to make required health care expenditures on streamlined housing developments approved under specific Government Code sections

The existing Labor Code Section 218.8 liability provisions are limited to contracts entered into between January 1, 2022, and January 1, 2026, while the new Section 218.9 applies to contracts from January 1, 2026 onward