Federal Bonding Program

What is the Federal Bonding Program?
Thousands of employers across the country have integrated the Federal Bonding Program into their hiring practices – industries that support our country’s economy – hospitality, retail, construction, transportation, auto repair, manufacturing, healthcare, non-profits, banking, tourism and more. This USDOL program is a great success, with over 50,000 job placements made for at-risk job seekers who were automatically made bondable.

What is Fidelity Bonding?

  • Insurance to protect employer against employee dishonesty
  • Covers any type of stealing: theft, forgery, larceny, and embezzlement
  • In effect, a guarantee of worker job honesty
  • An incentive to the employer to hire an at-risk job applicant
  • A unique tool for marketing applicants to employers
  • DOES NOT cover "liability" due to poor workmanship, job injuries, work accidents, etc.
  • Is NOT a bail bond or court bond needed in adjudication
  • Is NOT a bond needed for self-employment (contract bond, license bond or performance bond)

Who Is Eligible for Bonding Services?

  • Any at-risk job applicant is eligible for bonding services, including: ex-offenders, recovering substance abusers (alcohol or drugs), welfare recipients and other persons having poor financial credit, economically disadvantaged youth and adults who lack a work history, individuals dishonorably discharged from the military, and others
  • Anyone who cannot secure employment without bonding
  • All persons bonded must meet the legal working age set by the State in which the job exists
  • Self-employed persons are NOT Eligible for bonding services (bondee must be an employee who earns wages with Federal taxes automatically deducted from paycheck)
  • Bonds can be issued to cover already employed workers who need bonding in order to (a) prevent being laid off, or (b) secure a transfer or promotion to a new job at the company
  • Bonding coverage can apply to any job at any employer in any State

Who must request issuance of the Fidelity Bond?
Issuance of the bond for job placement to occur can be requested by either the employer or the job applicant. This request is to be made to the local agency certified by the Federal Bonding.

Can the Bond be issued at any time?
For the bond to be issued, the employer must make the applicant a job offer and set a date for the individual to start work. The job start date will be effective date of the bond insurance which will terminate six months later. After the six months, continued coverage will be made available for purchase if the worker has exhibited job honesty under the program's bond.

In what time period is the Bond effective?
The initial Fidelity bond is issued for a six-month period.

How much Bond insurance coverage will be issued?
A total of $5,000 bond coverage is usually issued, with no deductible amount of liability for the employer. Larger bond amounts can possibly be issued by "stacking" bonds if the certified agency issuing the bonds has sufficient quantity of promotional bonds available, and has determined that larger bond amounts are appropriate. When this bond coverage expires, continued bond coverage can be purchased from TRAVELERS by the employer if the worker demonstrated job honesty under coverage provided by The Federal Bonding Program. In addition, employers may receive up to a $2400 - $9000 tax credit for hiring an individual who has been convicted of a felony and/or released from incarceration or another WOTC targeted program. For more information, go to: Tax Credits

To request a Bond or get more information on Bonding Services contact: