Siddharth Dahiya
CEO, Peregrine Guarding
The private security industry is one of India’s most people-intensive sectors, employing millions of guards across commercial, industrial, and residential establishments. As the regulatory landscape evolves, the introduction of the New Wage Code has emerged as a significant turning point for guarding operations. The Code aims to streamline wage definitions, strengthen employee rights, health & safety and ensure fair remuneration – all critical objectives for a sector built entirely on human capital.
Yet, implementation of the Code presents both operational challenges and long-term opportunities for the industry. Understanding these nuances is essential for stakeholders, employers, and clients who depend heavily on uninterrupted, reliable security services.
A shift in wage structure and its immediate effects
The New Wage Code introduces a standardized definition of ‘wages,’ ensuring transparency and reducing the variability that previously existed across states and organizations. For guarding operations, where salaries form the largest portion of operating costs, this change has immediate implications.
Under the new framework, components like basic pay and dearness allowance must constitute at least 50% of total wages. This increases the base on which social security contributions are calculated. While this enhances long-term benefits for guards – such as provident fund, gratuity, and leave encashment – it also increases total cost-to-company for employers.
For a sector operating on already thin margins, the increase in statutory payouts requires recalibration of budgets, pricing structures, and contract terms. Many clients, accustomed to previous cost models, may initially resist the upward revision in service fees, creating short-term friction.
Key considerations for guarding operations under the new wage code
Beyond wage adjustments, guarding operations face several practical challenges:
- Contract Realignments: Long-term contracts signed under earlier wage structures now require renegotiation to reflect statutory changes. This involves detailed discussions with clients to ensure compliance without compromising service quality.
- Increased Administrative Load: Revising payroll systems, restructuring salary components, and ensuring multi-state compliance demand significant administrative bandwidth, especially for organizations operating nationwide.
- Workforce Planning Under the New Wage Framework: The revised wage structure requires organisations to reassess their budgeting and manpower deployment models. This includes ensuring that guards receive timely, compliant wages while maintaining operational efficiency across different sites. Balancing these elements becomes essential as companies align their processes with the new regulatory expectations.
- Guard Expectations & Communication: Guards, often coming from socio-economically vulnerable backgrounds, need clarity on how the new Code benefits them. Effective communication and training are crucial to build trust and reduce attrition.
The private security industry is one of India’s most people-intensive sectors, employing millions of guards across commercial, industrial, and residential establishments. As the regulatory landscape evolves, the introduction of the New Wage Code has emerged as a significant turning point for guarding operations. The Code aims to streamline wage definitions, strengthen employee rights, health & safety and ensure fair remuneration – all critical objectives for a sector built entirely on human capital
A pathway to professionalization and industry growth
Despite the challenges, the New Wage Code opens the door to several positive shifts in the industry. The most significant opportunity lies in the professionalization of the guarding workforce. With clearer wage structures and enhanced social security coverage, the sector becomes more attractive for long-term careers. Guards who feel secure, protected, and fairly compensated are more motivated, reliable, and committed – directly improving service outcomes for clients.
Another benefit is the level playing field the Code creates. Historically, wage disparities allowed non-compliant agencies to offer artificially low prices, undermining quality and ethics. The new Code standardizes compliance requirements, discouraging unfair competition and encouraging clients to choose partners on the basis of capability rather than cost alone.
Finally, the change incentivizes the industry to explore technology integration and process efficiencies. As wage-linked costs rise, organizations will increasingly look to deploy automation, digital reporting, remote monitoring, and smart tools to optimize manpower deployment. This creates a future-ready model of guarding that blends human vigilance with technological enhancement.
Conclusion
The New Wage Code is a transformative development for guarding operations in India. While it brings undeniable challenges – increased financial pressure, administrative restructuring, and contractual realignments – its long-term impact is largely positive.
By strengthening wage transparency, improving guard welfare, and promoting fair competition, the Code lays the foundation for a more mature, structured, and respected security industry. Stakeholders who adapt early, embrace transparency, and engage clients proactively will be best positioned to thrive in this new landscape.
Summary of the New Labour Code 2025:
- Unified Regulatory Framework.
- Expanded Coverage.
- Standardized Compliance.
- Enhanced Workers Welfare.
As India moves toward the New Labour Code 2025, the guarding sector stands at an important juncture. The Code brings together a unified regulatory framework that simplifies obligations for employers while reducing ambiguity across states. Its expanded coverage ensures that a wider segment of the workforce receives formal protections. With standardized compliance norms, organisations gain clarity and consistency in implementation. Most importantly, the focus on enhanced workers’ welfare underscores the need to safeguard the dignity, financial security, and long-term well-being of guards. Collectively, these reforms promote a more empowered and resilient workforce and a more accountable operational landscape.
