Payment Bonds (Labor & Materials)
Payment bond — also called a labor and materials bond — for agents. Guarantee subcontractors and suppliers get paid on a construction project. Start a bond quote.
A payment bond — also called a labor and materials bond — guarantees that a contractor will pay its subcontractors, laborers, and material suppliers on a construction project. It protects those parties, and the project owner, from liens when a contractor fails to pay. On public work it is almost always required alongside the performance bond.
What a payment bond does
- →Guarantees subcontractors, laborers, and suppliers are paid
- →Protects the owner from mechanic's liens tied to non-payment
- →Usually paired with a performance bond as a "performance and payment bond"
- →Sized to the contract amount
Who needs one
- ✓General contractors on public construction contracts
- ✓Contractors on private jobs where the owner requires payment protection
How to place it through Baker
- →Send the contract amount, the project scope, and the contractor's experience
- →We place it standalone or together with the performance bond
- →Start a bond quote, or send the application link to your client
** Terms used here are a summary only. Always refer to the bond form and the obligee's requirements.