YOUR SECURITY COMPANY COULD BE BREAKING THE LAW

South Africa is facing a challenging economic climate, businesses are under consistent pressure to reduce operating costs, and security services often become one of the first expenses to be scrutinised. Resulting in procurement departments, property managers and business owners often choosing providers based purely on price. But when it comes to security, the cheapest quote can sometimes conceal the biggest risk.

Across Durban and the broader South African security industry, there’s a proliferation of guarding companies operating outside legal and regulatory requirements. Some entirely unregistered with the Private Security Industry Regulatory Authority (PSIRA), while others, even large companies seem legitimate on paper, but are non-compliant in critical operational and labour related areas. It’s concerning that clients don’t realise that they may also be exposed to operational, legal and financial risks and consequences by appointing non-compliant service providers.

Labour Exploitation

One of the biggest compliance issues in the guarding sector is labour exploitation. Security companies driving their security officers to work excessive hours, often beyond legally permitted limits. In many cases, guards work 12 hour shifts continuously, seven days a week, with little or no proper rest periods. Overtime is often unpaid or purposely wrongly calculated, despite overtime pay being a legal requirement under applicable labour regulations and bargaining council agreements. This creates more than a labour problem. It creates a serious security risk. Fatigue greatly reduces operational performance.

Overworked security personnel are less capable of maintaining vigilance, recognising potential threats, and responding appropriately to incidents. In high-risk environments, reduced alertness can significantly increase vulnerability and exposure to loss. Another major issue involves statutory employee benefits. Non-compliant security companies often fail to register employees for mandatory industry related benefits such as provident fund contributions, medical insurance benefits, unemployment insurance, compensation cover for workplace injuries, and other required employee protections. In most cases, these so-called savings come directly at the expense of the guards, and in so doing, exposing both the security company and its clients to significant legal and financial risk.

When security companies cut corners on compliance, those savings do not come from nowhere, they come from underpaying guards, avoiding statutory contributions, neglecting training, reducing supervision, or bypassing operational controls. This creates a dangerous cycle where underpaid and overworked officers become more vulnerable to corruption, coercion, absenteeism, poor morale, and criminal infiltration. In practical terms, the weakest point in your security strategy may not be your fences, alarms, or CCTV systems, it may be the person standing at your gate.

Illegal Outsourcing

Another concerning trend is the illegal outsourcing of guarding contracts. Many clients appoint a security company believing they are contracting with a properly established provider, only to later discover the guarding services are being subcontracted to labour brokers, agents, co-operatives, or informal third parties. In the private security industry, this practice presents serious legal and compliance concerns and is contrary to regulatory requirements. This arrangement creates a dangerous lack of accountability.

Who is vetting the guards? Who ensures PSIRA compliance? Who carries liability if an incident occurs? Who ensures wages and statutory contributions are paid correctly? When multiple layers of subcontracting are introduced, accountability becomes diluted, oversight weakens, and risk increases dramatically. Appointing a security provider is not simple appointment decision, it’s a risk management decision.

Compliance Declaration

Before appointing any guarding company, businesses should go beyond simply asking questions during the sales process. Instruct the security provider to complete and sign a formal compliance declaration, signed by a director, owner, or duly authorised senior representative of the company. This declaration should confirm, in writing, that the security company is fully compliant in key operational and regulatory areas, including:

■ The company is fully PSIRA registered and in good standing.

■ All deployed security officers are individually PSIRA registered.

■ The company is fully compliant with bargaining council requirements and applicable labour legislation.

■ All overtime, wages, statutory contributions, and employee benefits are paid correctly and timeously.

■ Security officers are employed directly and legally, and not unlawfully outsourced through labour brokers, agents, co-operatives, or other third parties.

■ The company maintains adequate public liability insurance and all other required cover.

■ Supervisors and operational managers are appropriately trained, competent, and properly certified where required.

The declaration should also include a signed undertaking that any false, misleading, or omitted information may constitute a material breach of contract and could result in immediate termination of services. This declaration creates accountability and places responsibility squarely on the security provider to stand behind their compliance claims, rather than relying on just their word.

Ask Why

If a security quote seems significantly cheaper than the market average, businesses should ask why. Security is a labour-intensive service with real fixed costs: salaries, overtime, statutory benefits, uniforms, vehicles, supervision, training, compliance, and insurance all form part of legitimate operational expenses.

If a quote appears unrealistically low, there is a strong possibility that compliance is being compromised and ultimately service to the client too. Businesses must also remember an important legal principle, outsourcing a service does not outsource responsibility. If your contracted security provider is operating unlawfully or non-compliantly, regulators and authorities may not only scrutinise the service provider, but also the client who appointed them. Security Partner Don’t treat security as a commodity based solely on price. The true value of a security partner lies in compliance, professionalism, accountability, and operational capability. In a country facing persistent crime challenges, businesses cannot afford to gamble with security.

If you appoint a non-compliant guarding company, do not be surprised when a regulator comes knocking on your door. All it takes is one disgruntled employee reporting their employer, triggering a chain reaction that could ultimately land on your doorstep. There is no fixed fine for appointing a non-compliant security provider, penalties depend on the nature of the contravention. However, businesses may face regulatory penalties, labour claims, civil liability, and potentially losses running into millions of rand.

The regulator’s fine may hurt, but the civil claim after a serious incident on site is what can cripple a business. Because in the world of security, what looks cheap today may become extremely expensive tomorrow.

T: +27 (0)31 109 1888

E: care@mobiventures.co.za

W: www.mobiventures.co.za

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