Frequently Asked Questions

Question 1:

I am self-employed. Can I obtain a fidelity bond?

Answer:

No. The fidelity bond does not cover any self-employment.

Question 2:

If I accept a job as an independent contractor, and I am responsible for paying my own federal taxes, will the fidelity bond cover me?

Answer:

No. The fidelity bond does not insure independent contractors.

Question 3:

I am a salesperson. Am I bondable?

Answer:

You are bondable if you are working for a company that withholds federal income taxes from your wages. It does not matter if your wages are salary or commission; if federal income taxes are not withheld from your wages, you are not bondable.

Question 4:

How do I become bonded under this program?

Answer:

The employer must provide you with a written offer of employment on business letterhead. This letter is then taken to the nearest Michigan Works! service center. You may become bonded as soon as a Michigan Works! Employment Service provider approves the bonding application.

Question 5:

How long does it take to get bonded?

Answer:

After the bonding application is approved, the fidelity bond becomes effective on the job seeker’s first day of employment.

Question 6:

How is the amount of the bond determined?

Answer:

The employer establishes the amount of the bond based on the value of the property at risk during the worker’s employment. Bonds are issued in amounts ranging from $5,000 to $25,000, in increments of $5,000. The employer must justify the need for additional bonding over $5,000 in the offer of employment letter.

Question 7:

What is the length of time covered by the bond?

Answer:

The first six months of employment.

Question 8:

What happens after the bond expires?

Answer:

If the employee has demonstrated honesty during the first six months of free bond coverage, the employer may purchase continued commercial bond coverage through The McLaughlin Company at competitive rates.

Question 9:

Will the fidelity bond cover the employee’s workmanship, attendance, and job injuries?

Answer:

No. These are normal risks that an employer takes regardless of who is hired for a position within the organization.

Fidelity Bonding Program