What do you call a bond that is in place to protect against claims from unpaid suppliers and subcontractors?

A bond that protects against claims from unpaid suppliers and subcontractors is known as a payment bond. This type of bond ensures that contractors fulfill their payment obligations to those providing labor or materials for a project. If a contractor fails to pay these parties, the bond provides a financial remedy, allowing suppliers and subcontractors to receive compensation without having to pursue the contractor directly.

Payment bonds are typically required in construction projects, especially public works, to provide security to those who might be at risk of not being paid due to the contractor's financial issues. This form of protection is vital in maintaining trust and financial stability within the construction industry, as it helps ensure that all subcontractors and suppliers are compensated for their contributions.

Other types of bonds mentioned, such as performance bonds, specifically guarantee the completion of the project according to the contract terms, while surety bonds encompass various types of bonds, including both performance and payment bonds. Common law bonds are not a standard industry term used in relation to protecting against unpaid claims in construction.