payment bond
[/ˈpeɪmənt bɑːnd/]
nounpl: payment bonds
caução de pagamento
1. A surety bond that guarantees a contractor or subcontractor will pay all laborers, material suppliers, and other creditors involved in a construction project
The general contractor was required to obtain a payment bond before starting work on the federal highway project.
O empreiteiro geral foi obrigado a obter uma caução de pagamento antes de iniciar o trabalho no projeto de rodovia federal.
2. A type of performance security that protects project owners from financial loss if the contractor fails to pay suppliers and workers
The payment bond ensured that all subcontractors would receive compensation for their services.
A caução de pagamento garantiu que todos os subempreiteiros recebessem compensação pelos seus serviços.
In the United States, payment bonds are typically required by federal law (Miller Act) for federal construction projects over $150,000 and are commonly mandated for most state and public construction projects. In Brazil, payment bonds (cauções de pagamento) are increasingly required in construction contracts to protect workers and suppliers, reflecting similar concerns about contractor payment reliability. The requirement reflects construction industry standards to ensure financial protection for all parties involved in large projects.
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