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California Car Wash Bonds

What is a California Car Wash Bond?

A Car Wash Bond is a type of surety bond required in California for those engaged in car washing and polishing to ensure the car washing business and owner meet certain legal labor laws and related employer obligations pursuant to the provisions of California Labor Code Section 2055(b). The Car Wash Bond must be filed with the Labor Commissioner in a penal sum typically in the amount of $150,000. The condition of this surety bond is as set forth in Section 2055(b)(1) of the Labor Code of the State of California. Generally, the principal is obligated to pay employees when due in accordance with the law such portion of earned wages, interest on wages, and fringe benefits. This bond is continuous in form and will remain in full force and effect unless terminated or cancelled in the manner required. The bond is to remain in full force and effect for all liabilities incurred before, and for acts, omissions, or causes existing or which arose before, the cancellation or withdrawal.

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Why is a California Car Wash Bond Required?

The California Car Wash Surety Bond protects car wash and polishing employees in the event that financial damages are sustained due to a violation of the California Labor Code Section(s) 351 and/or 353 or as it pertains to the law where such portion of earned wages, interest on wages, and fringe benefits are due to these employees.

Car Wash Bonds And Getting Your California Business License/Registration

  • A Completed Application Form DLSE 666 or file an online application.
  • Annual state registration and any assessment fees
  • Proof of compliance with the local government’s (i.e., city, county, district, etc.) business licensing or regional regulatory requirements. For example, a car wash operating within the jurisdiction of the South County Regional Wastewater Authority is required to have an industrial waste discharge permit certificate, a copy of which would be included in the applicant’s registration packet.
  • A surety bond in the amount of $150,000.00. A surety bond is not required if the business is a car wash employer with a valid collective bargaining agreement. The bond must be issued by a surety company licensed to do business in the State of California such as Surety Bonds Direct and its partner carriers. The surety bond will issued be in favor of, and payable to the people of the State of California.
  • A surety bond in the amount of $150,000 must also be continuously maintained for renewal applicants while conducting a car washing and polishing business unless the business is covered by a valid collective bargaining agreement.
  • An Internal Revenue Service (IRS) form 8821 must be submitted directly to the IRS Compliance Verification Group (CVG).
  • A valid original workers’ compensation insurance certificate or a copy of the certificate from the Director of the Department of Industrial Relations.
  • If applicable, the employee leasing company must be currently registered with the Labor Commissioner as an employer conducting business as a car washing and polishing, and you must submit the following: A copy of the signed contract between you and the employee leasing company; and a current workers’ compensation insurance certificate provided to you by the employee leasing company.
  • Copies of the Fictitious Business Name Statements (doing business as (dba)) for any business name(s) used.
  • Copies of your State Employer Identification Number (SEIN) or a copy of the application for same.
  • Copies of your Federal Employer Identification Number (FEIN) or a copy of the application for same.
  • Copies of Articles of Incorporation, Articles of Organization, Certificate of Limited Partnership, or Secretary of State Statement of Information, as required based on entity type

Key Licensing Contact:

Division of Labor Standards Enforcement
Licensing and Registration Unit
1515 Clay Street, STE 401
Oakland, CA 94612

Additional California Car Wash Bond Resources & Links

State of California Department of Industrial Relations Labor Commissioners Office Licensing

The State of California defines "Car washing and polishing" as washing, cleaning, drying, polishing, detailing, servicing, or otherwise providing cosmetic care to vehicles. "Car washing and polishing" does not include motor vehicle repair, as defined in Section 9880.1 of the Business and Professions Code. Labor Code section 2051(a)