New York Wage and Welfare Bond

Get An Instant Quote on New York Wage and Welfare Bond Now

District Council No. 9 Int’l Union of Painters – Wage and Fringe Benefits Bond
Enterprise Association of Steamfitters’ Local No. 638 – Wage and Fringe Benefits Bond
IBEW Local No. 1249 Insurance Fund Bond ($100,000)
IBEW Local No. 363 – Fringe Benefits ($30,000) Bond
IBEW Union Local 237 – Wage and Benefits Bond
Joint Industry Board of the Electrical Industry – Wage & Welfare Bond
Mason Tenders’ District Council – Welfare, Pension, Annuity, and Training Fund Bond
New York District Council of Carpenters – Fringe Benefits Bond
Structural Steel & Bridge Painters Local No. 806 – Fringe Benefits ($300,000) Bond

Introduction

The New York Wage and Welfare Bond is a surety bond required by labor unions from contractors and businesses that hire union workers in New York. It guarantees that employers will pay agreed wages and make required contributions to union benefit funds, such as health, pension, vacation, and training programs, as outlined in collective bargaining agreements. This bond protects unions and employees by ensuring financial obligations are met.

Explanation: New York Wage and Welfare Bond

A New York Wage and Welfare Bond is a type of surety bond required by labor unions in New York for contractors and businesses that employ union labor. It serves as a financial guarantee that the employer will meet the obligations outlined in the union’s collective bargaining agreement (CBA).

Specifically, the bond ensures that the employer will:

- Pay all wages due to union employees as agreed in the labor contract.
- Make timely contributions to employee benefit funds (such as health, pension, vacation, or training funds).
- Comply with other financial obligations required under the union agreement.

If an employer fails to pay wages or contribute to union trust funds, the union can file a claim against the bond. The surety company will compensate the union (up to the bond amount), and the employer must reimburse the surety for any claims paid.

This bond protects union members and their benefit funds from losses caused by employer noncompliance. The required bond amount is usually determined by the union, based on payroll size and benefit obligations.

The New York Wage and Welfare Bond is commonly referred to by several other names, depending on the union or industry context. Some alternative terms include:

- Union Bond
- Collective Bargaining Bond
- Fringe Benefit Bond
- Union Wage and Welfare Bond
- Labor Union Bond

All of these terms describe the same type of surety bond — a guarantee that an employer will pay union wages and make the required contributions to union benefit funds.

Read our City of New York, NY – Street Obstruction Bond.

Key Points of the New York Wage and Welfare Bond

Purpose: Ensures contractors and employers hiring union labor in New York pay agreed wages and contribute to union benefit funds (health, pension, vacation, training, etc.).
Who Requires It: Labor unions (not the state) mandate this bond through collective bargaining agreements.
Parties Involved:
- Principal – Employer/contractor hiring union workers.
- Obligee – Labor union or union trust funds.
- Surety – Bonding company providing the financial guarantee.

See our City of Buffalo, New York – Collection Agency Bond.

Process of Getting the New York Wage and Welfare Bond

Determine Requirement
- Confirm with the labor union (e.g., IBEW, Teamsters, Carpenters) if a Wage and Welfare Bond is required under the collective bargaining agreement.
- The union sets the bond amount based on payroll size and benefit fund obligations.
Choose a Surety Company or Broker
- Contact a licensed surety bond provider in New York.
- Provide details about the union, bond amount, and agreement terms.
Submit Application
- Complete the bond application, which generally requires:
  - Business information (legal name, type, years in operation).
  - Financial documents (bank statements, tax returns, financial statements).
  - Owner/partner personal credit information.
Underwriting Review
- The surety evaluates the employer’s creditworthiness, financial strength, and business history.
- Stronger financials and credit may qualify for lower bond premiums.
Receive Quote & Pay Premium
- Premium is usually a percentage of the total bond amount.
- Pay the premium to activate the bond.
Bond Issuance
- The surety issues the bond, naming the union as the obligee.
- You receive the original bond document to file with the union.

Conclusion

The New York Wage and Welfare Bond is an essential safeguard for unions and employees, ensuring that contractors and employers fulfill their wage and benefit obligations under collective bargaining agreements. By securing this bond, businesses demonstrate financial responsibility and compliance, fostering trust and stability in New York’s union workforce.

Get our New York Utility Deposit Bond.

Frequently Asked Questions (FAQs)

Here’s a Frequently Asked Questions (FAQs) for the New York Wage and Welfare Bond:

Is the bond a one-time requirement?

No. Most unions require the bond to be renewed annually for as long as the employer hires union labor.

Does the bond replace payroll or benefit contributions?

No. The bond is only a financial guarantee. Employers are still directly responsible for paying wages and making contributions on time.

Can a Wage and Welfare Bond help employers qualify for union contracts?

Yes. Having the bond demonstrates financial responsibility and helps contractors maintain good standing with unions, making them eligible to secure and continue projects.

Is collateral ever required to obtain this bond?

In some cases, especially for higher-risk employers or large bond amounts, the surety may require collateral (cash or a letter of credit) to issue the bond.

Does the bond cover penalties or only unpaid wages/benefits?

Primarily, it covers unpaid wages and benefit contributions. Some union agreements may also allow claims for related penalties or interest, depending on the bond terms.

Need our Bestpass, Inc. – E-Z Pass Tags Bond.