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New Jersey electrical license requirements and insurance

To work for yourself as an electrician in New Jersey, you need the Licensed Electrical Contractor license. New Jersey has 3 electrical license types, and which one you need depends on the work you take on. The state's minimum liability insurance is $300,000, and workers' comp is required as soon as anyone other than the owner works for the business for pay. A $1,000 bond is required.

Who it applies to

1Who needs an electrical license in New Jersey? What is this?

Licensed Electrical Contractor: the person who stands behind an electrical business. Nobody may advertise or work as an electrical contractor without this license and a business permit. One licensed contractor can qualify only one business

LicenseWho needs itWhat it covers
Licensed Electrical ContractorThe person who stands behind an electrical business. Nobody may advertise or work as an electrical contractor without this license and a business permit. One licensed contractor can qualify only one businessInstalling, maintaining or servicing wiring from the service point on a customer's premises to any appliance or equipment used for light, heat or power. Solar panels, inverters and their electrical parts are included
Electrical Contractor Business PermitThe business itself. The license belongs to a person and the permit belongs to the company. A licensed electrical contractor who owns the business, or an officer, partner or employee who is actively engaged in the work, must qualify the permit and take full responsibility for inspecting and supervising all electrical work—
Class A Journeyman ElectricianThe rule says a person must hold it to do the listed electrical work, or to supervise it, when that person is not a licensed electrical contractor—
Who runs it

2Who issues electrician licenses in New Jersey? What is this?

New Jersey Board of Examiners of Electrical Contractors, part of the Division of Consumer Affairs issues electrical licenses in New Jersey.

See how this compares in every state: How to check a contractor's license, state by state

NameNew Jersey Board of Examiners of Electrical Contractors, part of the Division of Consumer Affairs
Websitenjconsumeraffairs.gov
Look up a licensenewjersey.mylicense.com
The lawNew Jersey Statutes, title 45, chapter 5A (N.J.S.A. 45:5A)
The rulebookNew Jersey Administrative Code, title 13, chapter 31 (N.J.A.C. 13:31)
Checked by a person against the official page
·3 official pages
Getting licensed

3How to become an electrician in New Jersey What is this?

New Jersey has 3 licenses that matter to an electrician: Licensed Electrical Contractor, Electrical Contractor Business Permit, Class A Journeyman Electrician. Each is below, with what you need before you apply.

LicenseExperience requiredExam
Licensed Electrical ContractorFive years in the electrical construction business right before you apply. Inside those five years you must finish a four-year apprenticeship approved by the US Department of Labor, then work at least one year as a journeyman. A year means 2,000 hours of hands-on work with tools. Supervising, estimating, engineering and office time do not countYes, three written sections. Electrical contractor, business and law, and alarm systems. You must pass all three. A third-party vendor runs it
Electrical Contractor Business Permit——
Class A Journeyman Electrician8,000 hours of hands-on work with tools installing, altering or repairing wiring, at least 4,000 of them in the five years before you apply, plus at least 576 classroom hours. Supervising, estimating, engineering and office time do not count—
What it costs

4How much does an electrical license cost in New Jersey? What is this?

The government fees on this page add up to about $500 in New Jersey. Add insurance, tools, and a vehicle to get the real number.

LicenseApplicationExamRetaking the examFirst licenseRenewalLate renewalGetting a lapsed license backReplacement licenseSeal, first issueProving your license to someone
Licensed Electrical Contractor$100$25$15$225$225$50$100$25$25$25
Electrical Contractor Business Permit———$150$150$25————
Class A Journeyman Electrician———$150$150—————

Added up

Government fees, added up$500

Does not include the exam fee paid to the vendor, the $1,000 bond premium, the $300,000 insurance policy, tools, a vehicle, or permit fees. The license and permit both cost less if issued later in the three-year cycle

Our estimate
Insurance

5How much electrical contractor insurance do you need in New Jersey? What is this?

The least liability insurance New Jersey lets an electrician work with is $300,000. Most customers ask for more. Workers' comp is required as soon as anyone other than the owner works for the business for pay.

Minimum liability insurance$300,000
Type of policyGeneral liability insurance from a company licensed in New Jersey, $300,000 for combined property damage and bodily injury or death in any one accident or occurrence. A bank letter of credit for $300,000 can be filed instead
Who this applies toThe business permit holder. The certificate is filed with the board and covers the electrical work done under that permit
Who must be named on the certificateThe board must get at least 10 days' written notice before the policy or letter of credit can be canceled
Workers' comp required?Yes, as soon as anyone other than the owner works for the business for pay. The board rules add that a permit holder must carry it for its own employees and its subcontractors' employees, keep proof on file, and make sure temporary workers are covered
Who can opt out
  • A sole owner with no employees does not need it.
  • In a partnership or LLC the partners and members do not count as employees, so a firm with no other workers does not need it.
  • A corporation must have it as soon as anyone, including an officer, works for it for pay
Workers' comp: if you skip it
  • Up to $5,000 for the first ten days without cover and up to $5,000 for every further ten days.
  • Failing to insure is a disorderly persons offense.
  • If it is willful it is a crime of the fourth degree
Checked by a person against the official page
·3 official pages
Money checks

6Does New Jersey check your credit for an electrician license? What is this?

New Jersey does not check your credit for this license.

Credit score you needNone. New Jersey does not look at your credit, your net worth or a financial statement for an electrical license or business permit
If your score is lowerNot needed. The $300,000 insurance or letter of credit and the $1,000 bond are the only money checks
How we knowThe qualifications rule asks for age, a diploma, experience and fees. The permit law asks for a licensed qualifier, insurance and a bond. None of them mentions credit
Checked by a person against the official page
·2 official pages
Bonds

7Does an electrician need a bond in New Jersey? What is this?

New Jersey requires a bond of $1,000. A bond is a promise, backed by an insurance company, that customers can be paid if you do not finish the job.

Does the state require a bond?Yes
Amount$1,000
How long it lastsTwenty-four months, then it is renewed for another twenty-four months each time it runs out

A bond is a promise, backed by an insurance company, that people can be paid if you do not do what the electrical law requires. New Jersey asks every electrical contractor for a $1,000 bond in favor of the State from a surety company approved by the Department of Banking and Insurance. Anyone harmed by a contractor's failure to follow the law or the board rules can claim on it.

Checked by software against the official page
·2 official pages
Showing your number

8Where must a New Jersey electrician show the license number? What is this?

In New Jersey: all business stationery and correspondence carries the contractor's name, the business permit wording with the number, and the business address with street name and number. Every application for an electrical permit or inspection also carries the contractor's signature and pressure seal.

What the number looks likeThe number that goes on trucks, paper and ads is the business permit number, not the personal license number
On your vehiclesBoth sides of every commercial vehicle show the licensed electrical contractor's name in letters at least three inches high, and the words "Electrical Contractor business permit number" or "Electrical Contractor Bus. Permit
On quotes, contracts, and invoicesAll business stationery and correspondence carries the contractor's name, the business permit wording with the number, and the business address with street name and number. Every application for an electrical permit or inspection also carries the contractor's signature and pressure seal
On ads
  • Every advertisement carries the same three things as stationery.
  • The contractor named in an ad is personally responsible for what it says.
  • You must carry your business permit identification while doing electrical work
If you forgetThe rule does not set a fine. Breaking a board rule can lead to action against your license
Checked by a person against the official page
·2 official pages
Tax

9Does an electrician charge sales tax on labor in New Jersey? What is this?

Whether New Jersey taxes your labor, your materials, or neither.

See how this compares in every state: Can you charge sales tax on labor? The rule in 25 states

What this tax isNew Jersey taxes contractor work by asking one question. Did the job add value or life to the building, or did it just keep the building working
Capital improvement (a job that becomes part of the building)
  • No sales tax on your bill.
  • Rewiring, new electrical outlets and an electronic garage door opener are all on the state's list of exempt capital improvements.
  • Get a signed Certificate of Exempt Capital Improvement, form ST-8, from the customer and keep it
Repair and maintenance workYou charge sales tax on the labor. Fixing faulty electrical outlets is on the state's list of repairs
The exception that catches people out
  • Installing a hard-wired security, burglar or fire alarm system is a taxable capital improvement.
  • You charge tax on the labor even though the system becomes part of the building, and you collect it from whoever hired you, owner or main contractor.
  • The customer cannot give you an ST-8 for it
New buildingsAll new construction is an exempt capital improvement. No tax on your labor
Who pays tax on materials
  • You.
  • The state treats a contractor as the final user of wire, conduit, panels, breakers and fixtures that become part of the building.
  • You pay sales tax at the supply house and you cannot use a resale certificate
Materials you bill to the customer
  • On a taxable job, list the materials as a separate line at your actual cost and no tax is charged on that line.
  • Everything else on the bill is labor and is taxed.
  • If you do not separate them, the whole bill is taxed
Homes versus businessesNo difference for electrical work. The same capital improvement and repair rules apply to a home and to a business
Tax-exempt customers
  • No tax on labor or materials for some customers.
  • They are a New Jersey or federal government body, a registered charity or church, a qualified business in an Urban Enterprise Zone, and a qualified housing sponsor.
  • You buy the materials tax-free with form ST-13 and keep the customer's exemption paperwork
When you are the subcontractor
  • When you work for a main contractor you still pay tax on your own materials.
  • You do not charge the main contractor tax on your labor, unless the job is a taxable capital improvement such as an alarm system.
  • The main contractor collects any other tax from the owner
Registering and filing
  • Register with the state at least 15 business days before you start.
  • File a quarterly return, form ST-50, even in quarters with no sales.
  • If you collected more than $30,000 in tax the year before, you also file monthly
Tax rate6.625 percent statewide. There are no county or city add-ons
Checked by a person against the official page
·2 official pages
Getting paid

10Getting paid: lien and notice deadlines for a New Jersey electrician What is this?

The notices and deadlines that keep your right to be paid in New Jersey.

Who has to send a notice
  • On a business job, nobody.
  • New Jersey has no preliminary notice on a commercial or industrial job.
  • On a home job, every lien claimant must first file a Notice of Unpaid Balance and Right to File Lien, then go through a short arbitration before any lien can be filed
Do you have to send a notice?Only on a home job
Home jobs: send your notice byFile the Notice of Unpaid Balance with the county clerk within 60 days of your last day of work (last day of work June 1 means the notice is filed by July 31). Within 10 days of filing it, serve a demand for arbitration on the owner through the American Arbitration Association
About home jobs
  • The arbitrator decides whether you have a valid claim and how much.
  • The arbitration must finish within 30 days of the association receiving your demand.
  • Only then can you file the lien itself
Home jobs: file your lien byWithin 10 days of receiving the arbitrator's decision, and never later than 120 days after your last day of work (last day of work June 1 means the lien is filed by September 29)
Business jobs: file your lien byWithin 90 days of your last day of work (last day of work June 1 means the lien is filed by August 30). File it with the county clerk where the property is
Copy to the ownerServe a copy of the lien claim on the owner within 10 days of filing it, by personal service or by certified and ordinary mail together
File a lawsuit by
  • You must sue to enforce the lien within one year of your last day of work.
  • There is a second, shorter deadline: if the owner, the community association, the contractor or a subcontractor serves you written notice requiring you to sue, you have 30 days from receiving it.
  • Miss either one and you lose the lien and must remove it from the record at once, or you pay the owner's costs and legal fees
Checked by a person against the official page
·5 official pages
Keeping it

11How do you renew an electrical license in New Jersey? What is this?

The Licensed Electrical Contractor renews every three years. You have 30 days after the expiry date to renew late. You need 34 hours of training each renewal.

LicenseRenewalTraining hours each renewal
Licensed Electrical ContractorEvery three years. You have 30 days after the expiry date to renew late—
Electrical Contractor Business PermitEvery three years—
Class A Journeyman ElectricianEvery three years—

Renewal fees are in what the license costs. The official page for each license is linked under how you get it.

Watch out

12What catches people out in New Jersey What is this?

The things people get wrong or do not expect about New Jersey, in a few sentences.

  • New Jersey splits the paperwork in two. The license is yours and lasts three years. The business permit belongs to the company, needs its own fee, and cannot be qualified by a licensee who already qualifies another firm.
  • The number on your truck is the business permit number, not your license number, and the letters must be three inches high.
  • You need a finished four-year apprenticeship before your journeyman year starts, and five years in the trade in total right before you apply.
  • The insurance floor is $300,000 combined, and a bank letter of credit for the same amount can stand in for a policy.
  • Wiring an alarm system is taxed differently from every other wiring job. The labor is taxed even though the system becomes part of the building.
Checked by a person against the official page
·5 official pages

13Where these numbers come from

The labels under each table are explained on how to read a page.

  1. njconsumeraffairs.gov/elec/Pages/default.aspx
  2. newjersey.mylicense.com/verification/
  3. law.cornell.edu/regulations/new-jersey/title-13/chapter-31
  4. law.justia.com/codes/new-jersey/title-45/section-45-5a-9/
  5. codes.findlaw.com/nj/title-45-professions-and-occupations/nj-st-sect-45-5a-9/
  6. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-3-8
  7. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-2-1
  8. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-2-3
  9. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-2-2
  10. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-2-4
  11. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-1-6
  12. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-1-7
  13. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-3-3
  14. njconsumeraffairs.gov/elec/Pages/FAQ.aspx
  15. njconsumeraffairs.gov/elec/Pages/examinations.aspx
  16. codes.findlaw.com/nj/title-45-professions-and-occupations/nj-st-sect-45-5a-9-1/
  17. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-5-1
  18. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-3-1
  19. nj.gov/labor/workerscompensation/employer-requirements/index.shtml?open=insurance
  20. codes.findlaw.com/nj/title-45-professions-and-occupations/nj-st-sect-45-5a-19/
  21. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-1-3
  22. law.cornell.edu/regulations/new-jersey/N-J-A-C-13-31-1-5
  23. nj.gov/treasury/taxation/pdf/pubs/sales/su3.pdf
  24. nj.gov/treasury/taxation/pdf/pubs/sales/su6.pdf
  25. codes.findlaw.com/nj/title-2a-administration-of-civil-and-criminal-justice/nj-st-sect-2a-44a-6/
  26. codes.findlaw.com/nj/title-2a-administration-of-civil-and-criminal-justice/nj-st-sect-2a-44a-21/
  27. codes.findlaw.com/nj/title-2a-administration-of-civil-and-criminal-justice/nj-st-sect-2a-44a-20/
  28. codes.findlaw.com/nj/title-2a-administration-of-civil-and-criminal-justice/nj-st-sect-2a-44a-7/
  29. codes.findlaw.com/nj/title-2a-administration-of-civil-and-criminal-justice/nj-st-sect-2a-44a-14/