Federal Bond Program

One of the services provided by Iowa Workforce Development to assist employers in recruiting and retaining the most qualified workforce is the Federal Bond Program.

The Federal Bond Program benefits the employer by offering bond coverage provided at no cost. The bond coverage is in effect the day the new employee begins working and continues for six months. The employer profits from the worker’s skills and abilities without taking the risk of potential theft or dishonesty. There are no documents to sign or paperwork to complete. The bond has no deductible and reimburses the employer for any loss due to employee theft within the specified six-month period.

The Federal Bond Program benefits the job seeker by providing job opportunities for those who have been or may be denied commercial bonding coverage due to their previous personal or employment history. The bond promotes confidence in a job seeker who needs a break to participate in employment and needs a chance to show that he or she can be a productive worker. It provides fidelity bond insurance for up to six months for any job seeker with risk factors and applies to any job except self-employment. Bonding coverage is provided at no cost to the job seeker.

Qualifications for Bonding

Individuals who are not commercially bondable due to past questionable behavior which casts doubt upon their credibility or honesty, or who have committed fraudulent or dishonest acts are eligible. This includes:

  • Individuals with a criminal history, including anyone with a record of arrest, conviction or imprisonment
  • Individuals with a poor financial credit history or who have declared bankruptcy
  • Individuals recovering from substance use disorders
  • Individuals who have been dishonorably discharged from the U.S. Armed Forces
  • Low income family members who lack a work history
  • At-risk youth

Job Requirements

  • The employer must have a specific date set when the applicant will begin work.
  • The applicant must be of legal working age.
  • Federal taxes must be automatically deducted from the paycheck.
  • Ensure that the job is suitable for the applicant.
    Example: An individual convicted of drug abuse, should not be placed where drugs are readily accessible like a pharmacy or hospital.
  • Self-employed and/or franchised individuals are not eligible.

Coverage Amounts

Bonds are issued in increments of $5,000.00 for a period of six months and the maximum amount is $25,000.00. $5,000.00 is generally sufficient to cover most circumstances.

  • Coverage is based on the potential or estimated risk to the employer for financial loss, which could result from dishonest acts by the individual while on the job (excluding vehicles).
  • Bonds in excess of $5,000.00 should be limited to positions where the employer may lose more than $5,000.00 in money or property at one time (the requester should base a bond request in excess of $5,000.00 upon reasonable justification).

Bond Information

  • Bonds can be issued to any employer regardless of whether the company has or has not commercially purchased a Fidelity Bond.
  • Specific bond coverage includes theft, forgery, larceny or embezzlement.
  • Bonds do not provide coverage for situations due to poor workmanship, job injuries or work accidents.
  • It is not a bail bond, court bond, contract bond, performance bond, name bond, blanket bond or license bond.
  • Bonds are not transferable from one employer to another.

The application process is simple and quick. Complete the Fidelity Bonding Certification form below and submit it to Iowa Workforce Development. A letter will be sent to the employer confirming the bond. The letter includes the name of the job seeker for whom the bond is being issued, bond effective date, amount and period of coverage, etc. This letter confirms the bond in advance of receipt of the actual Fidelity Bond, which is mailed to the employer.

Federal Government Bonding Home Page
Federal Bonding Brochure
Federal Bond Program Presentation

If you have additional questions, please contact:
Federal Bond Coordinator
Iowa Workforce Development
1000 E Grand Avenue
Des Moines, IA 50319
Phone: 515-725-3891
Email: federalbond@iwd.iowa.gov