Commercial cleaning and janitorial insurance in North Carolina

Registering and proving coverage as a North Carolina janitorial contractor

North Carolina doesn't license commercial cleaning as a trade, and since July 1, 2015 its cities and counties can't charge a general privilege license tax, so there's no city business license to buy. Your list is short: an entity on file, E-Verify once you're large enough, and the proof your clients ask for.

Entity filing and E-Verify

Corporations and LLCs form with the North Carolina Secretary of State. A company based in another state that will hold repeat North Carolina contracts needs a certificate of authority, and the state's own janitorial RFPs ask for proof of Secretary of State registration within 10 business days of award. Zoning and occupancy rules still apply to any office or supply room you rent.

Under G.S. 64-26, employers with 25 or more employees in North Carolina must run each new hire through E-Verify, and vendors on state contracts certify that they and their subcontractors comply. The law doesn't count workers employed less than nine months in a calendar year, but for a cleaning company with high turnover, it's an onboarding step on nearly every hire.

Sales tax: janitorial is exempt, floor refinishing may not be

The Department of Revenue's Services to Real Property Taxability Chart lists custodial and janitorial services as exempt, as long as they aren't part of the receipts from renting an accommodation. Carpet cleaning (not area rugs) and ductwork cleaning are also listed as exempt. The exemption itself is in G.S. 105-164.13(61a), which names custodial services and window washing as cleaning of real property.

The same chart lists refinishing existing floors as a taxable repair, maintenance and installation service. That includes waterproofing, staining, varnishing or painting incidental to the refinishing, and floor repair is taxable too. The statute's definition of those services, in G.S. 105-164.3, names floor refinishing outright.

The chart doesn't say whether a routine strip-and-wax counts as floor refinishing. Ask the NC Department of Revenue or your CPA whether your strip-and-wax work is treated as refinishing before you bill it without tax, and register for sales tax if any of your services turn out to be taxable.

Background checks on state and school work

The Department of Administration's janitorial template requires criminal background checks on owners, employees and subcontractor staff at the vendor's cost. Checks are completed within 90 days of the contract date and cover Social Security number verification plus felonies, misdemeanors and traffic records for at least seven years in every state or country where the person lived. Some facilities also require fingerprints, and nobody works until approved.

For schools, G.S. 115C-332.1 makes local boards require contractors whose staff interact directly with students to check each person every year against the state and national sex offender registries and keep anyone listed away from students.

We found no North Carolina janitorial employer registration or building-service wage law. G.S. 160A-20.1 actually works the other way: it bars a city from requiring a private contractor to pay above the state minimum wage or provide paid sick leave as a condition of bidding.

North Carolina comp: three regular employees and every subcontract crew

Comp is required once a business regularly employs three or more people, and the Industrial Commission looks at whether those three are employed regularly. Corporate officers are part of that count, even though each may opt out of his or her own coverage. Owners who run the company as sole proprietors, partners or LLC members stay outside the count unless they choose coverage.

The subcontract rule matters more for cleaning companies than the headcount. G.S. 97-19 says that if you sublet work without first obtaining the sub's certificate of comp coverage, and the sub has no policy in force on the day of the injury, the sub's injured workers become your responsibility, even when the sub is too small to need comp itself. Hand a building to a two-person crew without that certificate and their injuries can land on your policy and your audit.

Penalties for going without coverage run $1 per employee per day, with a $20 minimum and $100 maximum per day, and a person with the authority to buy coverage who willfully fails to is guilty of a Class H felony. You also stay liable for the injured worker's benefits. The NC Industrial Commission publishes the details.

North Carolina comp rates are filed by the North Carolina Rate Bureau rather than NCCI, so confirm your class with your carrier. Public buyers want statutory North Carolina comp for everyone on their property, and state janitorial RFPs allow subcontracting only with written consent. Our guide to class codes and audits shows how uninsured subs get picked up.

What North Carolina buyers put in writing

State work leans on guarantees more than limits. The Department of Administration's May 2026 janitorial RFP for the New Education Building in Raleigh required a performance guarantee in one of three forms:

• a performance bond equal to one-third of your annual cleaning price, delivered within 15 days of award and kept in force through extensions
• invoices reduced 10% for the first three months and 5% for the next nine, refunded at the end if you don't default
• a cashier's check or money order for 6% of the annual price

The same RFP lets you subcontract only with the state's prior written consent, asks you to certify E-Verify compliance for your company and your subs, and wants Secretary of State registration proof within 10 business days of award. Plan the sub list before you bid, not after you win.

Insurance on that RFP follows the state's General Terms and Conditions, which sit in a separate document. Smaller buyers spell limits out directly. The Town of Boone's 2026 janitorial RFP asked for general liability with a $1,000,000 occurrence limit and $2,000,000 aggregate, statutory comp, the town as additional insured (added to your policy as a protected party), and a janitorial fidelity bond of at least $50,000 against theft, disappearance or destruction of town property by your staff.

A performance bond and a fidelity bond answer different promises, and a surety looks at each separately. See our janitorial bond guide and the contract insurance checklist before your next bid walk.

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How claims play out against North Carolina cleaners

Contributory negligence works only with proof

A plaintiff who is even slightly responsible for their own injury generally recovers nothing in North Carolina, unless the last-clear-chance doctrine applies. But under G.S. 1-139 the party raising contributory negligence carries the burden of proving it. Your proof is the sign placement record, the time the floor was mopped and an inspection-app photo.

Example scenario: A night porter mops a clinic waiting room at 6:45 p.m. and props a sign at the hallway entrance. A visitor walks around it while reading her phone and falls. Without a timestamped photo of the sign, the defense is your porter's memory against hers.

The uncertified subcontractor

When a busy route supervisor hands two office buildings to a small sub without collecting a comp certificate, G.S. 97-19 can make your company liable for that sub's injured workers. The fix is paperwork before the first shift, not after the injury.

Officers who forget they count

A corporation with two officers and one regular part-time cleaner has three employees under North Carolina's count. Officers may exclude themselves from coverage, but they still count toward the line that triggers it. Hiring that one part-time cleaner in a slow month can be the moment you cross it, and the daily penalty runs from the first day you're out of compliance.

North Carolina cities and what we verified there

The North Carolina cost picture

We don't print North Carolina prices. These local factors move them.

State work brings a performance guarantee of one-third of the annual price as a bond, or retainage, or a 6% check. That ties up bonding capacity or cash, not insurance premium, but it shapes what you can afford to carry.

A janitorial bond's price usually depends on the bond amount and how many employees it covers, and some bonding companies also weigh your credit or time in business.

Uncertified subcontractor payroll can be added to your comp audit, so collecting certificates protects the premium too.