Licensed Electrical Contractor Business Law and Safety 3 — Questions and Answers
Question 1: According to OSHA 29 CFR 1926, what is the minimum clearance distance a worker must maintain from an unguarded energized overhead power line operating at 50 kV or less?
- 3 feet
- 10 feet (Correct answer)
- 15 feet
- 20 feet
Correct answer: 10 feet
OSHA 29 CFR 1926.416 and NFPA 70E require a minimum 10-foot clearance from unguarded energized overhead lines rated up to 50 kV.
Question 2: A change order on a construction project is best described as:
- A penalty clause for late completion
- A written amendment modifying the original contract scope, cost, or schedule (Correct answer)
- A request for additional workers
- An inspector's correction notice
Correct answer: A written amendment modifying the original contract scope, cost, or schedule
A change order is a formal written document that modifies the original contract terms, including changes to scope of work, price, or completion date.
Question 3: Under NFPA 70E, an arc flash hazard analysis must be performed to establish:
- The minimum wire gauge for branch circuits
- Incident energy levels and appropriate PPE boundaries (Correct answer)
- The number of circuit breakers required per panel
- Maximum ampacity of conductors
Correct answer: Incident energy levels and appropriate PPE boundaries
An arc flash hazard analysis determines the incident energy at a work location and the required PPE, as well as flash protection and limited approach boundaries.
Question 4: Which IRS form is used to report payments of $600 or more to a subcontractor who is not incorporated?
- W-2
- 1099-NEC (Correct answer)
- W-9
- 941
Correct answer: 1099-NEC
Contractors must issue Form 1099-NEC (Non-Employee Compensation) to unincorporated subcontractors paid $600 or more during a tax year.
Question 5: What is the primary purpose of a mechanics' lien in the construction industry?
- To require bonding for all subcontractors
- To secure payment for labor or materials provided to a property (Correct answer)
- To establish priority among competing insurance claims
- To register a contractor's license with the state
Correct answer: To secure payment for labor or materials provided to a property
A mechanics' lien is a legal claim against a property that helps ensure subcontractors and suppliers can collect payment for work or materials provided.
Question 6: Under the NEC, the grounding electrode system for a building must include which of the following if present on the property?
- A lightning rod system
- A metal underground water pipe in contact with earth for 10 feet or more (Correct answer)
- Any metal fence within 25 feet of the structure
- Buried conduit containing grounding conductors
Correct answer: A metal underground water pipe in contact with earth for 10 feet or more
NEC 250.52(A)(1) requires that a metal underground water pipe with at least 10 feet of contact with the earth be used as a grounding electrode.
Question 7: An electrical contractor purchases a commercial general liability (CGL) policy. This policy primarily protects against:
- Employee wage disputes
- Theft of tools and equipment
- Bodily injury and property damage claims from third parties (Correct answer)
- Costs to repair defective workmanship
Correct answer: Bodily injury and property damage claims from third parties
A CGL policy covers third-party claims for bodily injury and property damage arising from the contractor's operations or completed work.
Licensed Electrical Contractor Business Law and Safety 3
According to OSHA 29 CFR 1926, what is the minimum clearance distance a worker must maintain from an unguarded energized overhead power line operating at 50 kV or less?