Licensed Electrical Contractor Business Law and Safety 2 — Questions and Answers
Question 1: Under OSHA's lockout/tagout (LOTO) standard 29 CFR 1910.147, which employee is authorized to remove a lockout device?
- Any qualified electrician on the job site
- Only the employee who applied the lock (Correct answer)
- The job site supervisor
- The safety officer
Correct answer: Only the employee who applied the lock
OSHA requires that only the employee who applied the lockout device may remove it, except under specific procedures when that employee is unavailable.
Question 2: A licensed electrical contractor operating as a sole proprietor is personally liable for business debts. Which business structure would best protect personal assets?
- General partnership
- Sole proprietorship
- Limited Liability Company (LLC) (Correct answer)
- Joint venture
Correct answer: Limited Liability Company (LLC)
An LLC separates personal assets from business liabilities, shielding the owner's personal property from business debts and lawsuits.
Question 3: Which NEC article primarily governs the installation of services and service entrance equipment?
- Article 210
- Article 230 (Correct answer)
- Article 240
- Article 250
Correct answer: Article 230
NEC Article 230 covers services, including service conductors, service equipment, and related installation requirements.
Question 4: A contractor's employee is injured on a job site. Workers' compensation insurance primarily covers which of the following?
- Damage to third-party property
- The contractor's legal defense costs
- Employee medical expenses and lost wages (Correct answer)
- Equipment replacement costs
Correct answer: Employee medical expenses and lost wages
Workers' compensation insurance covers medical treatment and a portion of lost wages for employees injured on the job, regardless of fault.
Question 5: Under the Fair Labor Standards Act (FLSA), non-exempt employees who work more than 40 hours in a workweek must be paid at least:
- Regular pay plus a 25% bonus
- 1.5 times their regular rate of pay (Correct answer)
- Double their regular rate of pay
- Regular pay with a compensatory day off
Correct answer: 1.5 times their regular rate of pay
The FLSA mandates that non-exempt employees receive overtime pay at 1.5 times their regular rate for all hours worked beyond 40 in a workweek.
Question 6: When must a contractor obtain a permit before starting electrical work?
- Only for work valued over $5,000
- For all new construction but not repairs
- As required by the local Authority Having Jurisdiction (AHJ) (Correct answer)
- Only when working on commercial properties
Correct answer: As required by the local Authority Having Jurisdiction (AHJ)
Permit requirements are established by the local AHJ and vary by jurisdiction; contractors must comply with local ordinances governing when permits are required.
Question 7: Which form of contract dispute resolution is typically binding and conducted outside of court by a neutral third party?
- Mediation
- Arbitration (Correct answer)
- Negotiation
- Litigation
Correct answer: Arbitration
Arbitration is a binding dispute resolution process where a neutral arbitrator hears both sides and issues a final, enforceable decision.
