OAR 839-015-0230: Procedure for Obtaining Reduction in the Amount of Bond or Deposit Required

(1) In addition to the application for aggregate bond reduction provided in OAR 839-015-0157, labor contractors who have been licensed for at least two consecutive years may apply for a reduction in the bond or deposit required by ORS 658.415(3). Applications shall be in writing and on forms provided by the bureau. All completed applications should be mailed or delivered to the Bureau of Labor and Industries, Wage and Hour Division, License Unit, 3865 Wolverine Street, NE, Bldg. E-1, Salem, OR 97305. (2) Labor contractors may apply for a reduction in the bond or deposit required any time after the contractor has been licensed for no less than two consecutive years at the time a labor contractor license renewal application is made, pursuant to ORS 658.435(2). (3) The contractor must have prior approval from the Bureau of Labor and Industries before submitting a reduced bond or deposit. (4) No application for a reduction in the bond or deposit will be considered by the commissioner in the case of a con labor contractor license renewal application unless such completed application is received with a completed license renewal application at least 30 days prior to the expiration of the license. (5) Applicants for a reduction in the bond or deposit will be notified in writing of the commissioner's disposition of the application by the License Unit of the bureau within 15 days of receipt of a completed application for a reduction. (6) If application for a reduction in the bond or deposit is made less than 30 days prior to the expiration date of the labor contractor's license, the contractor must submit the bond or deposit required pursuant to ORS 658.415(3) without reduction along with the contractor's completed application for a bond or deposit reduction. (7) If an application for a reduction in the bond or deposit is approved by the commissioner after the contractor has submitted an unreduced bond, an amended bond for the reduced amount approved will be accepted by the commissioner after approval of the reduced bond. (8) If an application for a reduction in the bond or deposit is approved by the commissioner after the contractor has submitted an unreduced cash deposit, the commissioner will initiate a refund of the appropriate amount to the contractor within five working days after approval of the reduced deposit. (9) If an application for a reduction in the bond or deposit is approved by the commissioner after the contractor has submitted an instrument the equivalent of cash, the contractor will be allowed to replace such instrument with an instrument in the approved lesser amount. (10) No application for reduction in the required bond or deposit shall be approved unless the commissioner determines that: (a) The applicant has operated as an Oregon licensed labor contractor without an employee indorsement for at least two years in compliance with ORS 658.405 to 658.503 and with any other laws pertaining to the conduct of labor contractors; and (b) The applicant employs 21 or more employees; and (c) No valid claims for unpaid wages have been made against the applicant during the qualifying period of time for a bond or deposit reduction. (11) If the commissioner rejects the application, every reason for the rejection will be specified. (12) The commissioner may, for good cause shown, revoke the licensee's authorization to post a reduced bond or deposit. "Good cause" includes, but is not limited to, the following situations: (a) A valid claim is filed against the bond or deposit of the licensee; (b) Failure to pay wages to employees when due; (c) Failure to pay advances made to or on behalf of the licensee by construction property owners, owners or property managers of property where janitorial services are or were to be performed, growers or producers of agricultural products, or owners of lessees of land intended to be used for the production of timber; (d) The licensee or its agents cause damage to any person by reason of willful misrepresentation, fraud, deceit or other unlawful act or omission; (e) The licensee or its agents engage in labor contracting activities on behalf of anyone other than the business entity. (f) Actions of the licensee demonstrate the licensee's character, reliability or competence make the licensee unfit to act as a contractor pursuant to OAR 839-015-0520(3). (13) If the commissioner determines that the criteria in section (2) have been met by the applicant, the commissioner may reduce the amount of the bond or deposit that would otherwise be required pursuant to ORS 658.415(3) to an amount determined by the commissioner, but not less than the following: (a) If the commissioner finds that the contractor has so operated for a period of at least five years, $20,000; or (b) If the commissioner finds that the contractor has so operated for a period of at least four years, $22,500; or (c) If the commissioner finds that the contractor has so operated for at least three years, $25,000; or (d) If the commissioner finds that the contractor has so operated for at least two years, $27,500. (14) If the applicant provided one or more corporate surety bonds as proof of financial responsibility during any of the qualifying period of time for which application for reduction is being made, the applicant must submit with the application a statement from the licensee's bonding agent or agents certifying the length of time the licensee has been bonded by the agent and that there have been no valid claims filed against the licensee's bond(s) during the qualifying period of time covered by the application. If the licensee utilized more than one bonding agent, a statement is required from each agent for the period of time covered by the application.