Short answer. The bond answers for the wages the contractor left unpaid. Article 108 lets an employer or indirect employer require the contractor or subcontractor to post a bond equal to the cost of labor under the contract, on the express condition that it covers the workers' wages if the contractor fails to pay them.
What the law says
An employer or indirect employer may require the contractor or subcontractor to furnish a bond equal to the cost of labor under contract, on condition that the bond will answer for the wages due the employees should the contractor or subcontractor, as the case may be, fail to pay the same.
Labor Code, Article 108 — Posting Of Bond. Read the full provision →
The bond exists to be used, not just held
Article 108 states the bond's purpose directly: it is posted on condition that the bond will answer for the wages due the employees should the contractor or subcontractor, as the case may be, fail to pay the same. That condition is what the bond is for. It is not simply a deposit sitting with the employer or indirect employer — its function is specifically to cover unpaid wages the moment the contractor or subcontractor fails to pay them.
The bond is sized to the labor cost
The article ties the amount of the bond to a specific figure: it must be equal to the cost of labor under contract. That framing matters, because it means the bond is meant to be capable of covering the wages the arrangement was expected to generate, rather than an arbitrary or token sum. Sizing it this way is what allows the bond to actually answer for the wages due when the contractor defaults, instead of covering only part of what the workers were owed.
Requiring the bond is an option, not automatic
Article 108 uses the word may: an employer or indirect employer may require the contractor or subcontractor to furnish a bond. The article does not make posting a bond a mandatory feature of every contracting arrangement — it gives the employer or indirect employer the option to demand one as a form of protection against the contractor's possible default. Whether a bond exists in a given case therefore depends on whether that option was exercised when the contracting arrangement was set up.
What this means for an unpaid worker
For a worker whose contractor failed to pay wages, Article 108 explains what a bond, where one was required, is meant to do: it answers for the very wages left unpaid. The article does not itself describe the process for drawing on the bond or say what happens where no bond was ever required — it establishes only the condition the bond serves once posted. Whether one exists, and its terms, would depend on the specific arrangement between the employer or indirect employer and the contractor.