What Is a Farm Labor Contractor Bond

An H-2A Farm Labor Contractor is required by the U.S. Department of Labor, the Wages and Hours Division (also known as DOL) for the employment of migrant and seasonal temporary workers in agriculture. At Lance Surety Bonds, we have extensive experience in retaining agricultural entrepreneurs. We know it can be an uphill battle to connect with bad credit. That`s why we offer our bad credit bond program, and our goal is to help entrepreneurs with low credit scores, tax privileges, bankruptcies or civil judgments to come to a standstill and stay in business. Our How to Link page is a great linking resource in case you need more information. If a farm worker has reason to believe that their employer has breached their contractual obligations, they can sue the surety for financial compensation for something like unpaid wages or other types of damages. The guarantee company that supports the obligation undertakes to indemnify any person who makes a valid claim, but the related party has the final financial responsibility and must reimburse the guarantee company. It is intentional. Obligations exist to ensure that farmers cannot escape financial responsibility for illegal or non-contractual conduct. Several states, particularly California, Idaho, Washington, Oregon, Florida, and Connecticut, require farm workers to register with a state agency and issue a bond for agricultural labor businesses. The purpose of this guarantee varies slightly from state to state. In general, it ensures compliance with all applicable government regulations.

The bond also provides protection to employees hired by contractors and ensures that they work under reasonable conditions and are paid on time. For this reason, bond claims are a heavy financial and reputational burden and should always be avoided. After a complaint, it can also be quite difficult to be tied up again. Check out our FAQ page or What is a warranty? Side. If you need or buy a warranty, buy from us. SuretyGroup.com has been underwriting warranties in the United States for more than 35 years. When you work with us, you will enjoy the unique advantage of working with a team of highly experienced warranty agents with an in-house underwriting authority. This way, you get competitive and low interest rates, fast approvals, and instant bond delivery. In most cases, your deposit will be issued within 24 hours of the request. There are many forms and requirements that must be met before “agricultural contract activities” are carried out.

To simplify the process, the U.S. Department of Labor allows employers to submit their H-2A applications electronically. The ministry also provides a quick start guide and an online user guide to help you provide instructions on how to complete and submit the entire H-2A application package. Agricultural labor entrepreneurs must apply for a U.S. DoL Certificate of Registration. The application form required is Form WH-530. Once the application is approved, you will receive an Agricultural Labour Contractor (FBF) Certificate of Registration; At this point, you can start with the allowed activities. Depending on the specific activities that are requested for approval, additional forms or documents may be required. It is best to contact the Ministry of Labour if you have any questions about the application process. While the amount of the bond may be substantial in some places, your bond premium is only a percentage of it. Typical bond yields range from 1% to 4% of the bond amount if you qualify for the standard bond market.

For example, for a $25,000 bond, you are likely to pay a premium of $250 to $1,000. The warranty company reviews all claims to determine if they are well-founded. Investigations may involve lawyers, professional investigators, and other resources. Guarantees guarantee the payment of all valid claims and give creditors the opportunity to do justice and hold farmers accountable. In the event that the guarantor settles a claim, the farmer holding the bond must repay that debt. When you apply for a deposit from your guarantor, a number of financial indicators are examined to assess your claim. The most important factor is your personal creditworthiness as well as your personal and professional finances and professional know-how. The price of your bond is then determined according to the level of risk. .