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Fidelity Bonding Program

Employer

  • Fidelity Bonding Program

    Sponsored by the Workforce Development Agency, State of Michigan, the Fidelity Bonding Program was created to assist high-risk, but qualified, job seekers who have bona fide offers of employment. Typically, some employers may view ex-offenders, former substance abusers, and other individuals who have questionable backgrounds as high-risk job seekers who might be untrustworthy workers.

    What Is a Fidelity Bond?

    A fidelity bond is a form of business insurance. It is usually purchased to protect employers from any loss of money or property incurred as a result of hiring high-risk job seekers.

    The Fidelity Bonding Program offers a business insurance policy from the Traveler's Property Casualty Insurance Company. It protects an employer against employee theft, larceny, or embezzlement committed by a covered employee. Fraud is not included. A covered employee is any worker who is currently bonded by the Fidelity Bonding Program.

    The bonds issued by the Fidelity Bonding Program offer the employer a guarantee against losses up to $25,000 in value that are incurred as a result of hiring a high-risk job seeker. The fidelity bond serves as an incentive to encourage employers to hire job seekers who might otherwise be denied employment. Employers can, with minimal risk obtain workers, and job seekers can find gainful employment.

    How does the fidelity bond work?

    • Bond coverage is based on the value of the property at risk
    • Bonds are issued in the amounts of $5,000 to $25,000, in increments of $5,000
    • Bond insurance carries no deductible amounts
    • Bond insurance becomes effective on the employee's first day of employment
    • The fidelity bond is mailed directly to the employer
    • Bond insurance expires after six months. However, the employer may purchase continued coverage from the The McLaughlin Company

  • What Does the Fidelity Bond Cover?

    The fidelity bond covers job seekers who are considered high-risk due to some factor in their personal background and who have been rejected by a commercial bonding company.

    Fidelity bonds provide 100% insurance coverage and have no deductible; the employer is fully protected against losses resulting from employee dishonesty. Bond insurance coverage ranges from $5,000 to $25,000 for a six-month period.

    As an incentive to hire members of a targeted population, employers receive the bond coverage FREE OF CHARGE for the first six months of the covered employee’s employment. At that time, the employer can extend the bond insurance coverage by contacting The McLaughlin Company or an MWA service center. Bonding coverage after the initial six months continues at the employer’s expense.

    What is not covered under the fidelity bond?

    The Fidelity Bonding Program does not cover the following:
    • Liability due to poor workmanship, job injuries, or work accidents
    • Bail bonds or court bonds for the legal system
    • Contract bonds, performance bonds, or license bonds for the self-employed