Yes, according to CA. state law, anyone who performs any work on any structure that exceeds $500.00 in labor and materials must be licensed. Homeowners are exempted if they are doing the work personally on their own property. In CA. a flooring contractor will typically carry a C-15 specialty license. This covers flooring except ceramic or natural stone tile. You can check on the contractor's license status online by going here:
http://www2.cslb.ca.gov/CSLB_LIBRARY/Li ... equest.asp
They also need to carry workers compensation insurance IF they have any employees, including a "helper". A bond is required to obtain and hold a contracting license. One other tidbit. A contractor can only get 10% of the contract amount OR $1,000.00, whichever is less, as a deposit. This INCLUDES the material costs. A contractor may get an additional amount (draw) upon delivery of the materials, if they are supplying the materials. This is what I typically do to comply with state law. Here is an excellent read:
http://www.cslb.ca.gov/forms/wysk.pdf