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Indiana Wage and Welfare Bond

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District Council 91 of Int’l Union of Painters – Wage and Fringe Benefits ($25,000) Bond
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IBEW Local No. 481 – Wage and Welfare Bond
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Introduction

The Indiana Wage and Welfare Bond—also known as the Wage and Fringe Benefits Bond—is a type of surety bond required by labor unions or trust funds. It guarantees that employers, particularly in unionized industries like construction or trucking, pay all agreed-upon wages and fringe benefits (such as health, pension, and training contributions) in accordance with collective bargaining agreements (CBAs). This bond protects union workers by ensuring full and timely compensation for their labor and benefits.

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Explanation: Indiana Wage and Welfare Bond

An Indiana Wage and Welfare Bond, also referred to as a Wage and Fringe Benefits Bond, is a type of surety bond required by labor unions or multi-employer trust funds. It guarantees that employers—particularly contractors or subcontractors—pay all wages, fringe benefits, and welfare contributions owed to union employees under a Collective Bargaining Agreement (CBA).

Purpose of the Bond

The bond protects union workers and trust funds by ensuring that employers:

  • Pay contractually agreed wages

  • Make required contributions to fringe benefit funds, such as:

    • Health and welfare plans

    • Pension or retirement funds

    • Apprenticeship and training programs

    • Vacation or holiday funds

If the employer fails to fulfill these obligations, the union or trust fund can file a claim against the bond to recover the unpaid amounts.

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Who Needs This Bond?

Employers—usually contractors in unionized industries like construction, electrical, HVAC, or trucking—may be required to post this bond if:

  • They are signatories to a CBA with a labor union

  • They are non-union contractors working on union-controlled projects

  • They are new employers being vetted by a union

Unions such as the IBEW, LIUNA, IUOE, and the Plumbers & Pipefitters often require this bond before allowing an employer to hire union labor.

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Process to Obtain an Indiana Wage and Welfare Bond / Wage and Fringe Benefits Bond

Obtaining an Indiana Wage and Welfare Bond (also known as a Wage and Fringe Benefits Bond) involves several structured steps. This process ensures the employer is financially responsible and compliant with union trust fund obligations.

1. Confirm Bond Requirements

    • Contact the labor union or trust fund (e.g., IBEW, LIUNA, IUOE)

    • Request:

      • Required bond amount

      • Obligee name and address

      • Bond form or specific language

2. Choose a Bond Provider
3. Complete the Application

Submit:

    • Business name, EIN, and contact info

    • Union trade type and number of employees

    • Requested bond amount

    • Owner’s credit check

    • (Optional for higher bonds) Business financials, payroll reports

4. Underwriting Review

    • The surety company evaluates your financial strength, creditworthiness, and potential risk.

5. Pay the Premium

    • Upon approval, you pay the annual premium

Conclusion:

The Indiana Wage and Welfare Bond is a vital financial safeguard that ensures employers fulfill their contractual obligations to union workers. By guaranteeing the payment of wages and fringe benefits, the bond protects labor unions, supports fair labor practices, and promotes accountability within unionized industries across Indiana.

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Worker accident insurance provides disability compensation.

Frequently Asked Questions (FAQs)

What happens if the employer doesn’t pay?

If the employer fails to pay owed wages or benefits, the union or trust fund may file a claim. If valid, the surety pays, and the employer must reimburse the surety.

How much does the bond cost?

The premium typically ranges from % of the bond amount annually, based on the employer’s credit and financial status.

How is the bond amount determined?

The required bond amount is set by the union or trust fund, often based on payroll volume or estimated monthly contributions.

Is this bond the same as insurance?

No. It protects the union and its members—not the employer. If a claim is paid, the employer is financially responsible for repaying the surety.

How long is the bond valid?

Most wage and welfare bonds are issued for a one-year term and must be renewed annually to maintain compliance.

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