A Massachusetts employment agency bond is required by statute before a placement agency can be licensed or registered with the Department of Labor. Pursuant to Section 46A of the Massachusetts General Laws (MGLs), “employment agency” means any person who conducts in whole or in part an agency for the purpose of procuring or attempting to procure permanent or temporary help or employment or engagements, or for the registration of persons seeking such help, employment or engagement, or for giving information as to where and of whom such help, employment or engagement may be procured, where a fee is exacted or attempted to be collected for such service. The Massachusetts employment agency bond must be deposited with the Commissioner in the amount of three thousand dollars $3,000) issued by a surety company licensed to do business in Massachusetts. The surety bond must run to the people of the Commonwealth and be conditioned that the licensee will comply with the provisions of sections 46B to 46R, and shall pay all damages caused any person by reason of any misstatement, misrepresentation, fraud or deceit, or any unlawful act or omission of said licensee, his agents or employees, while acting within the scope of their employment, and made, committed or omitted in the business conducted under such license. The Massachusetts employment agency bond is not cumulative, being limited in the aggregate to the face amount of $3,000 regardless of the number of claimants or the number of years that the bond is in effect. The surety bond obligation is continuous, expiring only at such time as the agency surrenders or non-renews his or her license, unless revoked by the Department of Labor. The bond is cancelable upon sixty (60) days written notice by registered mail to both the licensee and the Massachusetts Department of Labor Standards. The surety bond is considered cancelled upon the expiration of sixty (60) said days period except as to liability for acts or omissions which occur prior to the date of cancellation. Notice of cancellation of the Massachusetts employment agency bond is deemed effective upon receipt of written notice along with sufficient proof of notice to the licensee. The surety bond does allow direct third party claims. Any person having a claim under the conditions of the obligation may initiate suit in any court of competent jurisdiction against the Principal and/or the surety, however such suit must be brought within three (3) years of the act that caused the loss or damages.
The Massachusetts Department of Labor provides an excellent “Frequently Asked Questions” section on its website. You may access the Massachusetts employment agency bond, license and registration materials by clicking here. Each licensed or registered employment agency must also post a copy of the law. You can download an approved copy for posting by clicking here. The Labor Commissioner contacts information is:
19 Staniford Street, 2nd Floor
Boston, MA 02114
Massachusetts surety leader, Surety One, Inc. is the ‘No. 1′ underwriter of surety bonds for the financial services sector. We offer private employment agency bonds to ALL applicants in every state that requires them. We also offer broad third party fidelity bond coverages designed for employment agencies to mitigate the risk of employee dishonesty losses. Visit us at SuretyOne.com, call (787) 333-0222 or (800) 373-2804, or email Underwriting@SuretyOne.com for a Massachusetts employment agency bond application or for information about any surety or fidelity product.