What is the Federal Bonding Program?
In West Virginia, the Federal Bonding Program is a joint effort between WorkForce West Virginia and the U.S. Department of Labor. Fidelity bonds are free of charge for any employee or employer. They can be used for any job, any employer and by any job seeker if there are any barriers to employment present. Bonds cannot be resold or transferred.
Bonding is a unique way WorkForce West Virginia and the U.S. Department of Labor can help ex-offenders, welfare recipients, people with a history of substance abuse, eligible youth and others having trouble getting jobs they deserve because they are ineligible for commercial bonding. Employers get the worker’s skills, abilities and knowledge without the risk of potential employee dishonesty. There are no forms for the employer to sign, and no processing to delay matters — the bond can go into effect instantly. Bond issuance represents confidence in jobseekers experiencing difficulty in getting a job that proves they can be a productive worker.
Bonds issued by the Federal Bonding Program serve as a job placement tool, guaranteeing to employers the job honesty of any at-risk jobseeker. Employers receive the bonds free of charge as an incentive to hire hard-to-place job applicants. The program was designed to reimburse employers for loss due to employee theft of money or property with no deductible amount becoming the employer’s liability.
How does the program benefit employers?
A total of $5,000 bond coverage is usually issued, with NO DEDUCTIBLE amount of liability for the employer. Once the date is set for the applicant to start work, the bond can be issued immediately. The employer signs NO papers.
Who is eligible?
The program covers any person who is at risk due to their being in one of the following groups:
- Poor-credit record or have declared bankruptcy
- Dishonorably discharged from the military
- Persons lacking a work history who are from families with low income
There are no age limits. The job usually is to be for at least 30 hours work per week. Workers must be paid wages with federal taxes automatically deducted from pay.
Note: The bond does not cover liability due to poor workmanship, job injuries or work accident. It is not a bail bond or court bond for the legal system. It is not a contract bond, performance bond or license bond. Self-employed individuals are not eligible. Before a bond can be issued, the applicant must receive a job offer and the employer must schedule a date to start work.
Are there Other Programs available for individuals who are eligible for FREE Federal Bonding?
Yes - The Work Opportunity Tax Credit (WOTC) is a federal tax credit program offering significant
incentives for employers who hire and retain individuals from specific target groups that have in the past experienced difficulty in securing employment, such as long-term welfare recipients and ex-felons.
How are the bonds issued?
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 WorkForce West Virginia. The job start date will be the effective date of the bond insurance which will terminate six months later. After six months, continued coverage will be made available for purchase if the worker has exhibited job honesty under the program’s bond.
Has the Federal Bonding Program had success?
Yes. About 40,000 applicants have obtained jobs due to being bonded.
A study of the U. S. Department of Justice found that released felony offenders with histories of alcohol and drug offenses helped secure steady employment by offering employers bonding as a job-hire incentive.
A research study published by the University of Texas surveyed employer attitudes toward hiring ex-offenders. The study found that 51% of the employers said they would hire ex-offenders if they were bonded.
Where can I get more information on the Federal Bonding Program in West Virginia?
The employer or job applicant should contact the nearest WorkForce West Virginia Career Center—check our Locations Map for details. The applicant must register with WorkForce West Virginia, either on-line or in-person.