Maybe you just got a new job and your employer says they want to get bond coverage for you. Or maybe you’re an employer and you heard that an employment bond could protect you from employee fraud. Bonds can be confusing, and you should fully understand what they are before you sign anything. There are a few different things that employment bonds can do, so this post will give you an idea of what employment bonds are and what your employers could be protecting themselves from.
As always, we recommend talking to your insurance agent if you have any specific questions.
What is an employment bond?
An employment bond is basically just a fidelity bond that protects an employer from their employees’ fraudulent or dishonest acts. Employers usually get bonds for employees who have access to the company’s money or valuables, like an accountant. This type of fidelity bond will reimburse your company if an employee steals from you or embezzles. Bonding employees is a fairly common practice, so don’t worry if your new employer wants to get a bond.
This is one employment bond definition, but there are many different ways and reasons to bond an employee. If you’re an employer and you want to bond an employee, then talk to your insurance agent and they can walk you through your options.
Common Questions About Employment Bonds
Who is covered?
An employer can either bond an employee, multiple employees, or a position. If they bond a position then you would bond, for example, the position of an accountant and no matter who the employee is they’re covered. Bonding multiple employees costs more and further covers the company if something goes wrong.
What if I’m a self-employed contractor?
There is another type of bonding called a third-party fidelity bond. A company gets a first-party bond to protect itself from its employees. An employer gets a third-party bond to protect itself from contract workers. The company will usually require contract workers to purchase a third-party bond themselves, even though it protects the company and not the contract worker. If you are a contract worker and you need a third-party fidelity bond, then talk to an insurance agent and they can help you out.
My company wants to bond me. What does that mean?
It’s not a bad thing if your new company want an employment bond! Your employers just want to protect themselves. Don’t sign anything you’re not 100% comfortable with, and ask questions. If you feel it’s appropriate, then negotiate your bond until you’re happy. Ask an attorney or insurance agent to look over your bond if you’re unsure about the terms.
If your employer wants to get a bond for your position, then there are a few things that will happen. You’ll get a background check, which may be part of your job application process anyway. If you have a criminal record, then it may increase the cost of your employment bond. You might have to get a credit check as well, but that depends on the position and company.
I’m an employer. How do I bond my employees?
Talk to an insurance agent. They can help you get a bond for your employees or positions. They can also help you figure out exactly what you need. We recommend working with independent insurance agencies because they have access to multiple providers, so they can get you a good deal.
How do I find out more about employment bonds?
There are other definitions and types of employment bonds. Ask your employer for details or talk to an insurance agent. If you’re looking for an employment bond in Nevada, then contact our insurance agents and they can help you out.