H2-A Farm Labor Contractor Surety Bonds Explained

The H-2A Labor Contractor Bond is a surety bond required by the United States Department of Labor. The bond is required of any person who meets the DOL’s definition of an employer and is not a fixed site or association employer. 

While there are a plethora of regulations tied to becoming a certified labor contractor, one requirement is a surety bond.  The Department of Labor does not make this easy as they do not supply a specific bond form. The department, however is very particular in what they will accept. Surety1, being a surety bond only agency has a bond form in its library that has been accepted by the DOL.

The surety bond must be written to cover liability incurred during the term of the work contract period listed on the H-2A Application and must remain in effect for a period of at least 2 years from the expiration date of the labor certification.  H-2A Labor Contractors must obtain the surety bond in the following amounts:

•  $5,000 for a labor certification with fewer than 25 employees;
• $10,000 for a labor certification with 25 to 49 employees;
• $20,000 for a labor certification with 50 to 74 employees;
• $50,000 for a labor certification with 75 to 99 employees; and
• $75,000 for a labor certification with 100 or more employees.

The cost of the surety bond is from 1% to 5% depending on the credit and experience of the applicant. Remember, surety bonds are not really an insurance product;they are more of a financial product. As such, the larger the bond one can expect more underwriting scrutiny.

Surety1 has the application available on-line and provide approvals on the same day the bond is applied for.