Secure jobs with security guards

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Published — October 12, 2017

The following post does not create a lawyer-client relationship between Alburo Alburo and Associates Law Offices (or any of its lawyers) and the reader. It is still best for you to engage the services of your own lawyer to address your legal concerns, if any.

Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.

Related Topic: How to Ensure Legitimacy of Job Contracting Arrangements

Though securing one’s business premises is not an essential part of one’s business operations, the demand for security services is still a constant for many enterprises. Though this involves job contracting by farming out security concerns to the security agencies, compliance with DOLE Department Order (D.O.) No. 174 on legitimate job contracting is not enough for security agencies, because the employment of security guards and other private security personnel are also governed by a set of rules embodied under D.O. No. 150-16. This holds true not only for engaging the services of private security agencies, but also that of detective and investigative agencies or operators.

The purpose of the Labor Department in promulgating D.O. No. 150-16 is to ensure compliance with mandated benefits and working conditions for security guards and other personnel in the private security industry, pursuant to the mandate of R.A. No. 5487 regulating the organization and operations of private detective, watchmen, and security guard agencies.

Right to control

It must be noted that in availing the services of security service contractors, said contractors reserve the right to determine not only the end to be achieved as required by the principal, but also the manner and means to be used in reaching that end [See: Sec. 2(g)]. This is consistent with the existence of an employer-employee relationship between the agency and the security guards in its employ.

Mandatory registration of security service contractors

Business owners have to be aware that, for good measure, they have to ensure that the security agency they are engaging is registered as a job contractor under D.O. No. 174. Without such registration, the agency might be considered by DOLE as a labor-only contractor, for which the principal will be treated as the direct employer of the security guards [See: Sec. 9.2]. This will render the principal liable not as an independent party to a contract, but as an employer to the security guards.

Service agreements

In engaging the services of security contractors, every business owner must be aware that they are required by law to stipulate certain terms and conditions, which must appear in their Service Agreements with the security service contractor [See: Sec. 4]. Some of which are as follows:

1. The specific description of the kind or nature of security job or service being contracted, as well as the place of assignment, have to be agreed upon.
2. The amount of security services to be rendered also has to be agreed upon, including the standard administrative fee of 20% of the total contract cost.
3. The principal should not be the ones to provide the basic equipment of the security guards. This is consistent with the principle that legitimate job contractors must be invested with the equipment needed to perform the services contracted. Such basic equipment are (a) at least one handgun for every two security guards, but in no case shall a security guard be posted without a firearm, unless otherwise required by the principal itself, and (b) at least one handheld radio. It must be noted, however, that if the principal will require more than the basic equipment mentioned above, the same shall be shouldered by the principal, and not by the agency anymore.

Requirements of the guards’ continued service

Considering that the security of the business is at stake, and deployment of armed persons within the principal’s premises is necessary, it is advisable for business owners to make sure that the security guards and other security personnel are duly licensed as such, and must have passed the physical and neuro-psychiatric examination and drug test required by the Philippine National Police. At any rate, all said requirements are necessary conditions for the guards’ hiring and continued employment [See: Sec. 7.1.].

Solidary liability of agency and principal

The security agency and the principal shall be jointly and solidarily liable with each other when the agency fails to pay the wages of its security guards and other private security personnel. In such case, the principal shall be considered as the “indirect employer” of the guards, and shall be severally liable with the security agency to the extent of the work performed by the security guards [See: Sec. 9.1(a)].

Principals, however, must beware that D.O. No. 150-16 likewise provides that if there are wage increases or adjustments after the execution of the Service Agreement, the prescribed increases in the wage rates of security guards and other private security personnel shall be borne not by the agency, but by the principal. In case the principal fails to pay the prescribed increases, however, the agency shall be jointly and solidarily liable with the principal [See: Sec. 9.1(b)].

Since the Labor Department is mandated to conduct inspections of establishments, compliance with labor standards is necessary for business owners. Principals must be aware of the guidelines in availing the services of security agencies under D.O. No. 150-16, so that potential liability as an employer may be prevented from materializing. Always remember that security guards are supposed to make your mind more secured, and not to add nor create more insecurities in your business.

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Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries regarding job contracting and subcontracting, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/0917-5772207.

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