Labor Organization Bonds
One of the purposes of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA) is to protect union funds and assets from losses caused by improper uses. Section 502(a) requires union officers and employees to be bonded to ensure that unions will be protected against losses caused by an act of fraud or dishonesty by a union officer or employee.
The minimum bonding amount for each covered officer or employee is 10 percent of the funds handled by the official and his or her predecessor, if any, during the preceding fiscal year. For a new union, the bond must be at least $1,000 for a local union and not less than $10,000 for other unions or for a trust.
The maximum bond required for any one person in any one union or trust is $500,000. However, a person who handles funds for more than one union or trust may be required to be bonded for up to $500,000 for each union or trust.
Product & Program Highlights
- Policy limits available up to $1 million
- No retention for employee theft
- Additional coverage available beyond the typical fidelity bond for:
- Forgery or Alteration
- Inside and Outside the Premises
- Money, Securities and Other Property
- Computer and Funds Transfer Fraud
- Money Orders and Counterfeit Currency
- Coverage for Fraudulent Transfer Instructions. Policy responds to fraudulent electronic instructions purportedly authorized by an Insured by have been fraudulently transmitted by someone else.
- Policy reimburses the Insured for Investigatory Expenses incurred in establishing the existence of any direct loss up to $5,000
- Our Carrier: Policy offered on admitted basis, 50 state availability, through Hudson Insurance Company, one of the most dedicated carriers for employee benefit plans. Hudson has an A.M. Best rating of “A” (Excellent), financial size category XV ($2.0 billion or greater).
- Hudson Insurance Company is a Department of Treasury approved surety
- Eligible accounts include International, National and Local Unions, Regional and District Councils and other labor related entities/officials requiring a bond.