Q. I heard from a friend of mine that there is a bill in the legislature to increase the amount that can be paid to handymen. I know that a similar bill was discussed last year but nothing became of it. It would be nice to be able to hire handymen for small jobs around my rental without having to worry that they will get in trouble if the amount goes over. I think that the current amount is $1000. Have you heard anything about this?
A. Actually yes. The Hawaii Association of Realtors just had their Realtor Day on January 9th (2019) and they met with many Senators and Representatives on this very issue.
Last year a bill was introduced to take the handyman exemption from $1000 to $5000.
That bill met significant resistance and didn’t go through. In fact, many times over the past years similar bills were introduced but they were defeated each time.
The handyman exemption was last raised in 1992. At that time, it went from $100 to $1000. Since then even though the cost of living has increased tremendously, there has been no increase in the amount of the exemption.
The current law (Chapter 444 of the Hawaii Revised Statutes) requires that a licensed contractor be hired for any construction work that costs more than $1000 or that requires a building permit. The handyman exemption allows for the hiring of a person not licensed as a contractor if the total value of the project, including labor, materials and tax is equal or less than $1,000. This exemption does not apply to electrical or plumbing work or where work is parceled into multiple projects.
Also, Act 195, Session Laws of Hawaii 2009, increased the monetary sanctions for engaging in contracting without the required license in violation of the contractors licensing law. Fines were increased from $500 to $2,500 for the first offense and from $1,000 to $3,500 for the second offense. So, the potential for a handyman to be fined for charging more than $1000 for a project increased drastically but the amount of the exemption has remained the same for 27 years.
Handymen do provide a service to the community by doing minor jobs and maintenance work such as touch up painting, installing screens, repairing doors, etc. These types of projects are many times too small for a licensed contractor to consider since their cost of doing business is so much more (overhead, licensing fee, TDI, Worker’s Comp, etc.). It also may not be cost effective for the homeowner to use a contractor for these small jobs for these same reasons.
The removal of materials and taxes from the exemption will allow that labor cost alone be included in the exemption.
If this was the case, a homeowner can select the materials that are best suited to the job – not just the least expensive.
Recently we had a project that required a sliding glass door to be installed. The door itself was right around $800 so a contractor had to be used for the project. After calling around to several contractors one finally agreed to give a bid. The bid was approved but the scheduling took some time to accomplish. In the meantime, Hurricane Lane was looming over the islands and the area had to be boarded up to prevent water from coming into the unit. Ultimately the glass door was replaced but it took several months to happen causing considerable grief to both the tenant and the homeowner. If the material cost wasn’t included in this instance, a handyman could possibly have done the work in a more reasonable time frame – relieving stress from everyone involved.
We have yet to see what happens with this bill, but I think this would be a huge benefit to homeowners across the state.