Are We Legally Responsible for Security Guards at Our Company-Owned Apartments?

Dear Amit, We are a private limited company located in Maharashtra where the shares held in the company allow the shareholders the right to occupy the apartments owned by the company. We have been employing watchmen to provide security to our premises.

Legal Obligations and Labor Statute

What are our legal obligations as far as terms and conditions of work are concerned, and under what labor statute would these fall? Would the Maharashtra Private Security Guards Act 1981 be applicable? I ask this as the provisions of Sub-section (4) of Section 1 of the Act state that it does not apply to security guards directly employed by the principal employer. Can we be deemed the principal employer as we have never issued appointment letters to the guards and have treated them as daily wagers?

I would be grateful if you could provide some clarity on what our legal obligations and liability are in such circumstances.

With thanks in advance for any guidance.

Regards, The Woods

Exclusion of Direct Employees from the Maharashtra Private Security Guards Act

The definition clause of the term "security guard" under Section 2(10) of the Maharashtra Private Security Guards (Regulation of Employment and Welfare) Act, 1981, specifically excludes members of the Principal Employer's family or any person who is the direct employee of the Principal Employer. Therefore, the watchmen employed directly by the Private Limited Company to provide security to the apartments owned by it are certainly out of the purview of the Maharashtra Act, 1981, as rightly inferred by the poster.

Since the apartments are owned by the Company and the watchmen are engaged for the purpose of security of the apartments, they become employees of the Company notwithstanding the absence of proper appointing orders or the mode of payments for the services rendered. So, they have to be treated as the Company's employees only, and as such, they have to be extended all benefits available to other employees of the Company.

Thank you for the clarification and confirmation.

In view of the fact that these watchmen are directly employed by the company as its employees, I assume that the statute for payment would be the Minimum Wages Act. The company is legally bound to pay wages as specified for this category under the notifications issued from time to time by the competent authorities.

Your post does not give a clear picture to me. It would have been better if deployed security personnel could go through the proper mechanism. I mean to say here that if your company has not hired any Security Agency (Licensed Contractor) as a service provider, the engagement of personnel by the "company" of "guards" means that all such personnel, even in the absence of any Appointment Letter, shall be treated as employees of the company, entitled to all benefits applicable to other employees.

Furthermore, I suggest switching over to a contract management system very strategically or employing other such services suitably in order to avoid permanent liabilities if the situation as perceived is correct.

Regards,
RDS Yadav
Labour Law Adviser
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