Running a security business is an operations and compliance undertaking before it is a sales one. The businesses that fail do so on staffing, wage compliance and equipment rather than on winning work.
This page covers what a security business needs in place to operate, beyond the registration itself.
Business Requirements at a Glance
What operating a security business generally requires.
- PSIRA registration of the business and of every person rendering security services
- A registered entity with a business bank account and SARS registration
- UIF and COIDA registration, with a current letter of good standing
- Compliance with the private security sectoral determination on wages and conditions
- Accredited training for every officer at the applicable grade
- Uniforms, equipment and, where applicable, vehicles and communication systems
- Firearm licences and competency certificates, where armed services are provided
- Public liability insurance, and cover appropriate to the services provided
- A B-BBEE certificate or sworn affidavit and CSD registration, for tenders
Registration and Legal Requirements
Price the compliance before pricing the contract. The sectoral minimum wage, UIF, COIDA, PSIRA levies, training, uniforms and equipment are the real cost of putting an officer on a site. A contract priced below that cannot be delivered lawfully, and the shortfall always comes out of the officers’ wages.
Underpayment is the sector’s enforcement problem and it is inspected. The Department of Employment and Labour enforces the sectoral determination and the Basic Conditions of Employment Act 75 of 1997, and arrears orders are made.
Staffing is the operational challenge. Twenty-four hour sites require multiple shifts, relief cover, leave cover and absence cover, and a business that has not planned that is either breaching working-time rules or leaving sites unmanned.
Working time limits apply. Excessive shifts are a legal issue and a safety one — a fatigued officer is not securing anything.
Every officer must hold a current PSIRA registration at the grade the role requires, and deploying one whose registration has lapsed is an offence.
Verify training providers with PSIRA before paying, since unaccredited training is a persistent problem and a certificate PSIRA does not recognise buys nothing.
Documents and Ownership Information Required
What the business needs on file.
- CIPC registration documents, company profile and memorandum of incorporation
- Certified ID copies for every director, member or partner
- Beneficial ownership information as filed with the CIPC
- Proof of the business physical address
- A SARS tax compliance status PIN
- A business bank account in the entity’s name
- Annual financial statements or management accounts
- A valid B-BBEE certificate or sworn affidavit
- Sector licences and permits, where applicable
- PSIRA business registration and every employee’s individual registration
- A current COIDA letter of good standing
- Employment contracts complying with the sectoral determination
- Payroll records evidencing compliance with minimum wages and conditions
- Training certificates for every officer, from accredited providers
- Firearm licences and competency certificates, where armed services are provided
- Insurance schedules for public liability and other cover
- Site instructions and incident records for every contract
Tax, Licence and Compliance Requirements
Insurance matters more than in most businesses. Public liability where a third party is injured, and cover appropriate to the services — cash handling, armed response and events each carry their own exposure. Confirm what a policy covers and what it excludes before relying on it.
Client contracts should be written and should set out the scope, the number of officers, the hours, the equipment, what happens on an incident, and the payment terms. Verbal arrangements in this sector produce disputes and unpaid invoices.
Site instructions in writing for every contract — what officers do, what they do not do, who to call, and how incidents are recorded. That document protects the officers, the client and the business.
Incident recording is not optional. Every incident recorded, reported to the client, and where a crime is involved reported to the police with a case number. A business without incident records cannot defend a claim.
Officers face real risk. Assaults on security officers are a genuine occupational hazard, and an employer that does not provide proper equipment, communication, backup and trauma support after an incident is failing its staff.
Cash-in-transit and armed response carry the highest risk and the highest compliance burden. Do not enter those services without the training, equipment, vehicles and insurance they require.
Report corruption approaches. Security environments attract them, and both offering and accepting are criminal offences under the Prevention and Combating of Corrupt Activities Act 12 of 2004.
Process, Deadlines and Ongoing Obligations
Register the business and the individuals with PSIRA, register for UIF and COIDA, arrange insurance, and price the first contract with full compliance costs built in.
Start small and within your capability. A business that takes a contract it cannot staff lawfully damages its registration, its clients and its officers. Growth follows demonstrated delivery.
Keep every registration current — PSIRA for the business and every officer, COIDA good standing, tax compliance and the B-BBEE document. Clients verify all of them.
Free support is available through the Small Enterprise Development Agency for the business side, and the Department of Employment and Labour publishes the sectoral determination free.
- Price compliance costs into every contract before quoting
- Comply with the sectoral determination on wages and conditions
- Plan shift, relief, leave and absence cover before taking a site
- Respect working time limits — fatigue is a safety issue
- Keep every officer’s PSIRA registration current
- Verify training providers with PSIRA before paying
- Carry public liability and service-appropriate insurance
- Put every client contract and every site instruction in writing
- Record every incident and report crimes to the police
- Do not enter cash-in-transit or armed response without full capability
Frequently Asked Questions
Why do security businesses fail?
On staffing and wage compliance rather than on sales. A contract priced without the full cost of an officer on site cannot be delivered lawfully, and the shortfall comes out of wages.
What does an officer on site actually cost?
The sectoral minimum wage plus UIF, COIDA, PSIRA levies, training, uniform and equipment, and the cover for shifts, leave and absence. Price all of it before quoting.
Can I deploy an officer whose registration lapsed?
No. It is an offence, it voids your position with the client, and it is exactly what PSIRA inspections find.
What protects the business in a dispute?
Written client contracts, written site instructions, complete incident records with police case numbers where relevant, and appropriate insurance.
Registration, wage and conditions requirements, training accreditation and firearm rules are set by PSIRA, the Department of Employment and Labour and SAPS, and are revised. Confirm current requirements with each before operating.