Surety Bond Encyclopedia

Wage Welfare Bond - Greater St. Louis Construction Laborer's in Missouri

Brief Summary

This bond stands behind the monthly reports and contributions a signatory contractor owes the Greater St. Louis Construction Laborers funds. It gives the fund trustees a solvent party to collect from if a month goes unpaid, and it lets you meet their requirement by paying a premium to a surety instead of setting aside the full bond amount yourself.

The Wage Welfare bond for the Greater St. Louis Construction Laborers funds guarantees that a contractor bound to the Laborers' agreements will file its monthly reports and pay what it owes to the Greater St. Louis Construction Laborers Welfare Fund, the Construction Laborers Pension Trust of Greater St. Louis, the St. Louis Vacation Fund and the Laborers' training fund. The amount and form come from the funds or the agreement, so get the current figure from the fund office before the bond is written.

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How to Apply for a Wage Welfare Bond:

Get a copy of the signed agreement or letter of assent that binds your company to the Laborers' contract.
Ask the fund office for the required bond amount, the exact obligee name and any required bond form.
Give the surety your legal business name and address exactly as they appear on the agreement.
Provide owner information for the surety's credit review.
Sign the surety's indemnity agreement and pay the premium.
Deliver the executed bond to the fund office and keep a copy with your payroll records.

Detailed Information About the Missouri Wage Welfare Bond:

What most contractors get wrong

This is not a city or state license bond, and it does not pay workers directly. It backs a private obligation. A contractor that signs the Laborers' collective bargaining agreement in the St. Louis area agrees to send monthly reporting forms and contributions to a group of employee benefit funds. The bond protects those funds if the contractor stops paying.

Who the money is owed to

Federal collection cases in the Eastern District of Missouri name the same plaintiffs again and again: the Greater St. Louis Construction Laborers Welfare Fund, the Construction Laborers Pension Trust of Greater St. Louis, the St. Louis Vacation Fund, the Laborers' joint training fund, and Laborers Local Unions 42 and 110. Contractors become bound through the agreement with the Associated General Contractors of St. Louis or the agreement with the Site Improvement Association. In the Site Improvement Association agreement, Article V, Sections 5.03 through 5.10 require monthly reports and payments to the Welfare, Pension, Vacation, Training, Site Advancement, Supplemental Dues and LECET Funds.

What a missed month costs

Under 29 U.S.C. 1145, an employer must pay contributions according to the terms of the plan and the agreement. When the funds sue and win, 29 U.S.C. 1132(g)(2) requires the court to award the unpaid contributions, interest, liquidated damages under the plan, and reasonable attorney's fees and costs. The Laborers' agreements set liquidated damages at twenty percent of contributions not paid on time. The funds also have the right to examine your books periodically to confirm payments were made correctly.

Amount and form

The bond amount and the required wording come from the funds or the agreement. Ask the fund office for the current amount, the exact obligee name and any required form before the bond is issued. The premium is set by the surety after it reviews the owners' credit and the company's finances.

Eligibility and Requirements for a Missouri Wage Welfare Bond:

Obligee named as the funds or their boards of trustees, as the fund office directs.
Bond conditioned on payment of contributions owed under the collective bargaining agreement.
Monthly reports and contributions to the Welfare, Pension, Vacation and Training funds.
Liquidated damages of twenty percent on contributions not paid on time under the agreements.
Payroll books and records open to periodic examination by the funds.

Missouri Wage Welfare Bond FAQs:

Is this the same as a contractor license bond?

No. This bond comes from the Laborers' collective bargaining agreement and protects the benefit funds. It is separate from any city or county license or permit bond your company may also carry.

Who can make a claim on the bond?

The funds named as obligee. They are the parties that sue in federal court to collect unpaid contributions, and the bond gives them a surety to collect from if the contractor cannot pay.

What can the funds recover if I fall behind?

Under 29 U.S.C. 1132(g)(2), a court that rules for the funds must award the unpaid contributions, interest, liquidated damages under the plan, and attorney's fees and costs. The Laborers' agreements set liquidated damages at twenty percent of late contributions.

How much is the bond?

The amount is set by the funds or the agreement. Ask the fund office for the current figure and the required wording before the bond is issued, because a bond written for the wrong amount or to the wrong obligee may be rejected.