Delivering exceptional service across California since 2000, Call us: 310-714-5616
Delivering exceptional service across California since 2000, Call us: 310-714-5616
California Labor Commissioner Appeal Bond Requirements
Understanding the Bond for Appealing Labor Commissioner Orders
§13644. Bonds for Filing an Appeal from an Order, Decision or Award.
(A) The bond that is required pursuant to Labor Code Section 2673.1(g), as a condition precedent to filing an appeal from an order, decision or award of the Labor Commissioner, shall be issued by a surety licensed to do business in the State of California, in an amount equal to one and one-half times the award, and shall be made payable to and posted with the Labor Commissioner. An undertaking in the form of a cashier’s check or money order made payable to the Labor Commissioner may be provided to the Labor Commissioner in lieu of posting this surety bond.
The surety bond or undertaking shall be delivered to the office of the Labor Commissioner where the hearing that resulted in the order, decision or award was held. The bond or undertaking shall be conditioned that if any judgment is entered in favor of the employee, the contractor or guarantor shall pay the amount owed pursuant to the judgment, and if the appeal is withdrawn or dismissed without entry of judgment, the contractor or guarantor shall pay the amount owed pursuant to the order, decision or award of the Labor Commissioner unless the parties have executed a settlement agreement for payment of some other amount, in which case the contractor or guarantor shall pay the amount that it is obligated to pay under the terms of the settlement agreement.
If the contractor or guarantor fails to pay the amount owed within 10 days of the entry of judgment, dismissal or withdrawal of the appeal, or the execution of a settlement agreement, a portion of the bond or undertaking equal to the amount owed, or the entire bond or undertaking if the amount owed exceeds the bond or undertaking, shall be forfeited to the employee.
Upon receipt of this appeal bond or undertaking, the Labor Commissioner shall provide the contractor or guarantor posting the bond or undertaking with a notice of posting of the bond with the Labor Commissioner pursuant to Labor Code Section 2673.1,
(B) stating the name and case number of the order, decision or award, the amount posted with the Labor Commissioner, the date this amount was posted, and that no additional appeal bond need be posted with the court because this case involves minimum wages or overtime compensation owed to garment workers, and thus, the appeal bond provisions of Labor Code Section 2673.1(g), rather than the appeal bond provisions of Labor Code Section 98.2(b), apply to the filing of a de novo appeal from the Labor Commissioner’s order, decision or award.
The contractor or guarantor filing an appeal from the order, decision or award shall advise the court with which it is filing this appeal that it has posted the required bond with the Labor Commissioner by attaching to its notice of appeal a copy of the notice of posting of the bond with the Labor Commissioner.
An appeal bond (also called a supersedeas bond) in California is a type of surety bond required when a party appeals a court decision and wants to delay paying a judgment until the appeal is resolved. This bond guarantees that if the appeal fails, the appellant will satisfy the judgment, court costs, and any related damages.
1. Purpose:
- o Ensures that the appellee (winning party in trial court) is protected from financial loss if the appeal is unsuccessful.
- o Prevents frivolous appeals by requiring financial backing.
2. Parties Involved:
- Appellant (Principal): The party appealing the court decision and required to obtain the bond.
- Obligee: The court or the winning party (appellee) that benefits from the bond.
- Surety: The company that issues the bond guarantees payment if the appellant loses and fails to pay.
3. Cost of an Appeal Bond in California:
- Typically, the bond amount must be 1.5 to 2 times the judgment amount (California Code of Civil Procedure § 917.1).
- The premium (cost to obtain the bond) generally ranges from 3% to 5% of the bond amount annually, depending on risk factors such as creditworthiness and collateral.
- Example: If the judgment is $500,000 , the bond amount may be $750,000 to $1 million , and the premium might range from $7,500 to $50,000 per year.
4. Best Collateral for an Appeal Bond:
- Cash (held in escrow)
- Irrevocable letter of credit (ILOC) from a bank
- Real estate with sufficient equity
- Marketable securities (stocks, bonds, etc.)
- Personal or business assets (depending on the surety’s requirements)
5. How to Obtain an Appeal Bond:
- Contact a surety bond provider or bonding agency specializing in appeal bonds.
- Provide financial documents, including credit reports, financial statements, and details of the judgment.
- Pay the premium and provide acceptable collateral.
- o The bond is then filed with the court to stay the enforcement of the judgment.
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Commercial surety bonds can generally be divided into five types of bonds:
1. License and Permit Bonds
- Required by federal, state, or local governments as a condition for obtaining a license or permit for various occupations and professions. License and permit bonds include auto dealer bonds, mortgage broker bonds, contractor license bonds, and surplus lines broker bonds.
2. Court Bonds (also called judicial bonds)
- Required of a plaintiff or defendant in judicial proceedings to reserve the rights of the opposing litigant or other interested parties. Court bonds include appeal bonds, supersedeas bonds, attachment bonds, and injunction bonds.
3. Fiduciary Bond (also called probate bonds)
- Required of those who administer trust under court supervision. Typical bonds are executor and administrator bonds, trustee bonds, guardian bonds, and conservator bonds.
4. Public Official Bonds
- Required by statute for certain holders of public office, to protect the public from malfeasance by an official or from an official’s failure to faithfully perform duties. Public official bonds included county clerk bonds, tax collector bonds, notary bonds, and treasure bonds.
Miscellaneous Bonds
- These are commercial surety bonds that do not fit into any of the types above. Included are a wide variety of bonds, such as warehouse bonds, title bonds, utility bonds, and fuel tax bonds.
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