7 min read · Last updated September 7, 2026
- The Federal Bonding Program (FBP) has issued 70,000 fidelity bonds since 1966, free to both the employer and the worker.
- Standard coverage is $5,000, with amounts available up to $25,000 and a $0 deductible, for the first six months of a new job.
- Eligible applicants include justice-involved individuals, people in recovery from substance use, welfare recipients, those with poor credit histories, workers without a job history, and people with a dishonorable military discharge.
- Either the employer or the job seeker can request a bond through their state’s bonding coordinator, with no application and no paperwork to sign.
In this article
- What the Federal Bonding Program Actually Covers
- Who Qualifies as an At-Risk Job Seeker
- The Bond Itself: Amount, Deductible, and Duration
- How to Request a Bond
- Why This Bond Often Goes Unused
- Frequently asked questions
Marcus walked out of his fifth interview in two months certain the felony conviction on his background check had ended it again, the same way it ended the four interviews before it. The job was a stockroom opening at a regional distribution warehouse, paying $17 an hour. What neither Marcus nor the hiring manager knew: the company could have requested a $5,000 fidelity bond that same morning, at no cost, and had Marcus covered before his first shift started.
What the Federal Bonding Program Actually Covers
The Federal Bonding Program (FBP) is a fidelity bond, a type of business insurance that reimburses an employer for money or property lost to an employee’s dishonest acts. The U.S. Department of Labor (DOL) created the program in 1966 and has issued 70,000 bonds since then through its Employment and Training Administration (ETA).
The bond covers intentional dishonesty: theft, forgery, larceny, and embezzlement, where the employee means to cause the employer a loss and personally profit from it. It does not cover job injuries, work accidents, or a liability claim over poor workmanship. This is a narrow, specific kind of coverage, not a general safety net for anything that goes wrong on the job.
Here is the part that matters for the reader: a bond is not something you buy. It is issued free of charge to the employer, and it costs the worker nothing either. The government absorbs the underwriting risk that a commercial insurer would otherwise decline to take on.
Who Qualifies as an At-Risk Job Seeker
The program’s own definition of “at-risk” is narrower and more specific than the word suggests. It is not a judgment about character. It is a label insurance companies apply to anyone who might be denied standard commercial fidelity coverage, which in turn gets that person labeled “not bondable” and quietly passed over for jobs that require it.
According to the Federal Bonding Program’s background page, eligible categories include:
- Justice-involved individuals, meaning anyone with a criminal record or a history of incarceration
- Individuals in recovery from substance use disorders, whether alcohol or drugs
- Welfare recipients
- People with poor credit records
- Economically disadvantaged youth and adults who lack a work history
- Individuals dishonorably discharged from the military
If you have ever assumed a criminal record or a five-year gap in your résumé automatically disqualifies you from a job that requires bonding, that assumption is the barrier, not the record itself. The Federal Bonding Program exists specifically to remove it.
Younger applicants without any employment history often face the same “not bondable” wall for a different reason: there is nothing yet to underwrite against. A program like Job Corps can build the work history and training record that makes a first job offer easier to land, with the bond covering the employer’s risk once that offer comes.
The Bond Itself: Amount, Deductible, and Duration
A standard Federal Bonding Program bond covers $5,000, according to the New York State Department of Labor’s program summary. That is enough to replace a stolen cash drawer or cover a single fraudulent vendor payment, the kind of loss a small employer would otherwise absorb out of pocket. Larger amounts, up to $25,000, are available in $5,000 increments when a state bonding coordinator approves the higher limit.
Every bond carries a $0 deductible, meaning the employer pays nothing out of pocket even if a claim is filed. Coverage runs for six months from the worker’s start date, then self-terminates. No renewal notice, no cancellation form, nothing for the employer to track.
| What the bond covers | What the bond does not cover |
|---|---|
| Theft of money or property | Job injuries or workplace accidents |
| Forgery | Poor workmanship or performance issues |
| Larceny | Liability claims of any kind |
| Embezzlement | Self-employment or contract work |
If the worker completes the six months without an incident, the employer can then purchase continued commercial coverage on that same employee, since the bond period effectively served as a proving ground.
How to Request a Bond
Either the employer or the job seeker can start the request. It goes through the nearest state bonding coordinator, typically reached through a local American Job Center under the Workforce Innovation and Opportunity Act (WIOA) system that funds the nation’s public workforce centers.
There is no application for the job seeker to fill out and no paperwork for the employer to sign. Once a start date is confirmed, the bond becomes effective that day. The program describes this step as issued instantly, since the only requirement is a confirmed hire.
A person can also call the toll-free line before an interview to get the nearest coordinator’s contact information. That way, the employer hears about the option before making a hiring decision, not after rejecting the application. Some job seekers print a brochure explaining the program and bring it directly to the interview.
Why This Bond Often Goes Unused
Most rejections tied to a background check do not happen because a company has a strict policy against hiring people with records. They happen because nobody in the hiring process knew a free bond was available to cover the exact risk that made them hesitate.
If you are a job seeker with a record, a credit problem, or a long employment gap, do not assume the hiring manager already knows about this program. Most do not. Mentioning it yourself, or handing over a brochure with your application, puts the decision back in your hands instead of leaving it to a guess about what the employer already understands.
If you are the employer, the same logic runs the other way. A candidate’s background check flagged something that concerns you, but a $5,000 to $25,000 bond, issued the same day at no cost, may already cover the exact loss you are worried about. Calling your state bonding coordinator before declining an otherwise strong candidate costs a phone call. Declining costs a hire.
Frequently asked questions
Does the Federal Bonding Program cost the employer or the worker anything? No. The bond is issued free of charge to the employer, and the worker pays nothing either. The government absorbs the cost through a contract with the U.S. Department of Labor’s (DOL) Employment and Training Administration (ETA), which is why no premium or deductible applies to either party.
Can I request a bond before I have a job offer? Not exactly. A bond becomes active once a start date is confirmed, not while you are still interviewing. You can still contact your state bonding coordinator before an interview, understand the coverage in advance, and mention it to a hiring manager the moment your background check becomes part of the conversation.
What happens after the six-month bond period ends? The bond self-terminates automatically once six months pass, and the employer does nothing to cancel it. If the employee proved trustworthy during that window, the employer then has the option to purchase continued commercial fidelity coverage on that same worker, using the bond period as a track record.
Does the bond protect against workplace injuries or bad performance reviews? No. Fidelity bonds cover only intentional dishonest acts, such as theft, forgery, larceny, or embezzlement, where the employee sets out to cause a loss and personally profit from it. Job injuries, workplace accidents, and poor job performance all fall outside what the bond protects against.
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