Wage and Welfare Bonds

Why is a Wage and Welfare Bond Required?

Union workers are part of a collective agreement. This agreement will outline requirements such as:

• Terms of employment
• Wages
• Fringe benefits
• Employment hours
• Leave and paid time off
• Safety policies

A large portion of the private sector workforce is unionized and part of a collective agreement.

However, some employers attempt to:

• Underpay workers
• Fail to provide required benefits
• Roll back contract terms and agreement
• Among many other possibilities

This is why the union the workers belong to often require a wage and welfare surety bond for certain employment contracts.

The surety bond ensures the employer will follow through on the employment contract.

If workers are harmed financially or by any breach of agreement, they can make a claim against the employer's surety bond for financial compensation.

The available compensation is capped at the surety bond amount.

What Is The Wage and Welfare Surety Bond Amount?

Every wage and welfare bond amount will be different based on the employment contract and the demands of the union and/or collective agreement.

The bond amounts are typically equal to the amount of wages to be earned from the employment contract, based on the number of employees being hired.

The most common bond amounts we've helped with range from $10,000 to $50,000.

What Is the Wage and Welfare Bond Price?

Once you have your bond amount, you can get your exact pricing to purchase your bond.

The price will depend on a rate quoted from a surety company. A surety is an insurance company that underwrites wage and welfare bonds.

The primary factors that affect the rate are:

• Personal credit of the employing owner or owners
• Experience with past employment contracts
• Bonding history if an owner has been bonded in the past

The interesting part of obtaining a price is every surety is different. The rate each will quote is often one to three percentage points different.

This means depending on your bond amount, the price could be hundreds of dollars in difference.

Wage and Welfare Bond Price Example

We are Surety Bonds Direct, a specialized surety agency. It's out job to price shop for you by working with the highest A-rated sureties and collecting their rates.

This makes purchasing a surety bond easy. You just request your price quote and we'll do the rest.

Let's look at a pricing example.

We'll assume a bond amount of $40,000. Most of the hundreds of bond amounts we've helped with range from $20,000 to $50,00.

The important thing is to pay attention to the price different rates produce, remembering that rates often differ by 1% to 3%.

As you can see, if you save two percentage points, you can save well over $400.

Click here and complete our online quote form and get your exact pricing within one business day.

You are under no obligation to purchase once you get pricing. It's vital information to help you get the employment contract closed so you can get the work you need started.

If you prefer to speak with a bond specialist, call 1-800-608-9950.

How Long Does a Wage and Welfare Bond Last?

In most cases, the terms of the employment contract will not last over a year.

This means the wage and welfare bond you're purchasing will last for the employment term.

Once the employment term is over, the bond will expire.

However, if under some circumstance an employment contract does last over 12 months, you would need to renew the bond at the one year mark.

Renewing requires paying a renewal premium.

If you work with us, you'll be assigned a bond specialist to manage you bond for you. If you need to renew, your bond specialist will handle all of the details making the process easy.

What Happens When You Purchase Your Wage and Welfare Bond?

When you're ready to purchase your bond, you only need to complete an online order form.

After your purchase, our bond issuance team will get to work to prepare your bond with the:

• Correct bond form
• Necessary signatures
• Seals
• Power of Attorney

Depending on your specific needs, we can email you a copy of the bond immediately and/or mail you the original bond as well.

How you need to prove you've purchased the bond will vary based on each individual contract.

Get your pricing today by filling out our online quote form or calling a bond specialist at 1-800-608-9950.