Security Agency Compliance: Should We Register Under CLRA or Shop & Establishment Act?

Will a security agency fall under the CLRA Act or the Shop & Establishment Act? We have 40+ security guards deployed by us to different locations such as shops, factories, companies, cinema theaters, and hospitals. Will we have to register under the Contract Labour Act?

Security Agency Compliance

A security agency, as a business by itself, will fall under the state's Shops and Commercial Establishment Act. As such, you should take the registration required as per that Act. When your employees (security guards) are deployed in various sites, the operation connected with it will be covered by the CLRA Act. If you engage 20 or more of such employees (guards) in any plant, hospital, etc., for that engagement, you should take a license. That means a license is to be obtained separately for each site of deployment wherever the number of such engagements exceeds 19. In case you have deployed only less than 20 in any particular site, there is no need to get a license for that site. But that does not mean that the CLRA is absolutely absent in respect of that engagement. You are still under the cover of the CLRA Act.

You will also be governed by the provisions of the Private Security Agency (Regulation) Act.

Security agencies fall under the purview of the Private Security Agencies Act 2005. They are also governed by state regulatory authorities, such as the Maharashtra Private Security Guards Employment and Welfare Act, where the state defines rules and schemes for the same.

In Maharashtra, the security services business mentions that CLRA is not applicable. Rather, it is governed by guards boards of various districts for compliance matters, where Section 23 defines clauses of exemptions. However, the Shops and Establishments Act is universally applicable to all businesses.

Please check with your state labor department about the applicability of CLRA to security services. Nevertheless, it is observed that compliances need to be followed more or less like CLRA and all other applicable acts.