Private Security Industry-Compliance with Labor Laws and PSARA v. Profitability?

India is persistently exposed to formidable security challenges and there is an increasing threat from the rising crime rate and escalating terrorism. On the other hand, police-public ratio in India is 136.42 police personnel to protect every 1 lakh citizens1 which is a huge gap generally bridged by Private Security Guards (PSGs) being our first line of defense. 

According to the FICCI-Grant Thornton report, the security services industry is becoming employment generating machinery, currently employing 7 million people and growing at a rate of 20%. Its value is expected to increase from INR 40,000 crore in 2014 to INR 80,000 crore by the end of the year 2020. It is also estimated that the Indian private security industry will generate about 5 million additional jobs by 2020.2

The governing mechanism for PSGs is provided under Central Act-The Private Security Agencies (Regulation) Act, 2005 (the “Act”), also called as PSARA. The act allows every state to formulate different rules for implementation of PSARA. Some states have formulated their own set of rules including Delhi Private Security Agencies (Regulation) Rules, 2007; Haryana Private Security Agencies (Regulation) Rules, 2007; Uttar Pradesh Private Security Agencies (Regulation) Rules, 2007; etc.

The Ministry of Labour and Employment issued a notification defining “Skilled Work” as “Work which involves skill or competence acquired through experience on the job or through training as an apprentice in a technical or vocational institute and the performance of which calls for initiative and judgment.”3The Act clearly stipulates a minimum of 160 hours of training to describe someone as trained workers in multiple sections of the Act.

The PSGs are involved in performing various skilled functions like access control using baggage x-ray machine and metal detection equipment. Therefore, necessary changes should be made in the Central and State Minimum Wages Acts.

In case of armed PSGs and supervisors, it is being proposed that they should be classified as highly-skilled workers. The Ministry of Labour and Employment issued a notification defining “Highly-Skilled Work”as “Work calling for a high degree of perfection &full competence acquired through intensive technical or professional training or work experience for long years and requires a worker to assume full responsibility for his judgment ordecision.”4The definition has qualified training with the word “intensive” which means that there must exist a difference in the training to be received by a skilled worker and a highly-skilled worker.

Considering the growth prospects and hence projected demand of employable human resource in this industry it is important that the job as a PSG becomes a respectable vocation with secured job prospects. Need of the hour is to make the necessary amendment and classify them as skilled workers so that the PSGs stop suffering from lower wages and lack of self-respect. At the same time the government will have to ensure that this amendment does not end up affecting the viability of this high employment sector.

By:

Ravi Singhania

www.singhania.in