In the State of Alabama, non-profit organizations are given the option by the Secretary of the Alabama Department of Labor (ALDOL) to directly pay for unemployment compensation instead of making unemployment tax contributions. If non-profit organizations opt to do so, they must post a surety bond with the Secretary as a financial guarantee that all unemployment compensation claims due to the public will be paid, regardless of the financial condition of the non-profit organization.
Jet Insurance Company offers the Alabama Blanket Unemployment Compensation Tax Bond to satisfy the requirements of the ALDOL and enable qualified non-profit organizations to elect for this option and reduce their total tax burden.
When you go with Jet, you are buying your bond directly from the surety carrier, which means you cut out all of the middlemen (like brokers and agents) who slow down the bond process and cost you more with their commissions and fees.
With Jet, the price for the Unemployment Compensation Tax Bond is always a small percentage of the total bond amount required by the Secretary of the ALDOL, considering some factors about your business like years of experience, credit score, and potentially financial health.
With Jet, the bonding process is streamlined and simple. We get you the bond you need at a competitive rate with no unnecessary administrative red-tape.
Under the Code of Alabama Section 25-4-51, the Secretary of the ALDOL determines the required bond amount, as a percentage of the non-profit organization’s covered payroll for the four calendar quarters previous to their election. When renewing the bond, the Secretary will again reference the covered payroll for the previous four quarters to set the required bond amount.
When a non-profit organization elects to its unemployment compensation directly rather than contribute through unemployment tax, they are assuming a significant responsibility for the welfare of the Alabama public. The Secretary of the ALDOL requires the Unemployment Compensation Tax Bond, pursuant to the Code of Alabama Section 25-4-51, as a financial guarantee that unemployment compensation claims will be paid, even if the subject non-profit organization encounters financial difficulty or becomes insolvent.
The Alabama Department of Labor exists to protect the workforce of the State, and ensure critical services are rendered such as unemployment compensation, workers’ compensation, labor market regulation, and others. The bond serves that mission by protecting the former employees of participating non-profit organizations, guaranteeing that they will receive unemployment benefits once separated.
Applying for the Unemployment Compensation Tax Bond is easy with Jet! The initial application takes minutes and can be done completely online. The Jet team may ask for some amplifying business information about your non-profit to help get you the best rate available.
Once you have provided that information, Jet will conduct a short review and get back to you quickly with an approved rate and an option to purchase. Once you have provided payment, Jet will immediately send you a receipt and an electronic copy of the bond for your records.
Yes, Jet can! Once your purchase is complete, Jet will immediately send the original signed and sealed bond to the ALDOL for filing.
If you prefer to send the original bond to the ALDOL yourself, that option will be available for you at checkout, and we will ship the bond to you instead. Remember, your bond must be filed within 30 days of electing to assume unemployment compensation payments, and all paperwork must be filed with the ALDOL at the following address:
State of Alabama Department of Labor
649 Monroe Street
Montgomery, AL 36131
Unfortunately, no. The Unemployment Compensation Tax Bond, once posted, must remain active for two years. At the completion of the two year period from the date of election, you may opt to either renew your bond (the Secretary of the ALDOL will reassess your bond amount in this case) or return to contributing unemployment tax.
The Unemployment Compensation Tax Bond is continuous for two years at a time, and at each biannual anniversary can be renewed, to the Secretary’s approved bond amount.
The Jet team will notify you well in advance of the anniversary date of your bond, and provide you an option to purchase.
First and most importantly, non-profit organizations can avoid bond claims by dutifully paying the unemployment compensation claims filed by their former employees. If unemployment claims are left unpaid, the Secretary of the ALDOL will make the payments utilizing the surety bond. If you are unable due to financial hardship to pay unemployment claims, you should attempt to communicate with the ALDOL to arrive at a solution.
Notify Jet immediately if you are notified of a potential bond claim. Jet will come to your defense to the maximum extent possible, but we will need your cooperation to do so. Your transparency with the details of the claim and your financial status will help Jet give you the best possible defense.
If the claim is judged valid however, Jet Insurance Company will be obligated to pay the claim on your behalf. If this occurs, Jet is acting as your financial guarantor. You remain responsible for the actions that resulted in the claim, and must reimburse Jet for the amount paid on your behalf. Failure to do so would return your non-profit organization to paying unemployment taxes to the State of Alabama, and could jeopardize your ability to secure a surety bond in the future.