Direct Hire vs. Outsourced Security

Many potential clients want to know why they should consider outsourcing security when they could simply hire a security guard directly. While in-house security does have some advantages to outsourced security, it also has several significant drawbacks that make outsourced security a more attractive choice for most businesses.


Advantages of Direct Hire Security

Directly hiring security guards for your company can be advantageous for several reasons. For one, as the direct employer of your security team, you have direct control over who you hire. You can “hand pick” individual candidates based on whatever criteria you choose (e.g. only hiring former police officers). You can also design their uniforms, create your own reports and reporting system, and structure your security team in whatever manner you see fit. Direct hire of security guards allows for maximum customization of your security team to match both your brand image as well as your internal business processes and operational standards.


Direct hire security guards also tend to identify more with your business than outsourced security, creating a greater since of loyalty to your company. As they are direct employees, they likely see themselves as coworkers of personnel in other departments, from sales to accounting. This sense of loyalty can boost morale among your security guards and reduce turnover.


Speaking of turnover, a direct hire security guard will likely be with your business for longer than an outsourced security guard. Contracts with outsourced security ensure you will receive the number of guards per shift that the contract specifies, but does not require that the same guards be sent to your business every time. Indeed, you will often work with different guards covering the same shifts over the length of the contract. Consequently, direct hire security typically offers more consistency in staffing if that’s something that’s important to you.


Disadvantages of Direct Hire Security

While direct hire security can be an attractive option for the reasons mentioned above, there are a number of disadvantages that many clients fail to consider. The primary drawback of direct hire security is cost. As direct hires of your business, direct hire security must be processed as W2 employees. This entails payroll, Social Security, Medicaid and other taxes as well as additional payroll processing fees. As the employer of your security team, you also bear the burden of uniform and equipment costs, which can be significant (uniforms must be periodically replaced, equipment will break, etc.). Finally, if you offer employee benefits (e.g. 401(k), health insurance) your security guards will be entitled to those benefits as well. In general, the cost of direct hire security is 15 to 25% more expensive than outsourced security when all these factors are taken into account.


Another major drawback of direct hire security is liability. Unlike an outsourced security company, which bears 100% of the legal liability of the actions or inactions of its guards, the liability of direct hire security falls squarely on the employer. If you hire a guard that ends up getting too aggressive with a customer and inadvertently breaks their arm in attempting to arrest them for shoplifting, you will almost certainly be met with a civil and possibly even criminal lawsuit. With outsourced security, any legal complaints against a guard are directed to the security company, not the client for which the guard works.


Additionally, while loyalty was mentioned as a benefit to direct hire security, it can also be a double edged sword. Indeed, direct hire security guards can become lax in their duties as they begin to themselves as “just another part of the company.” They can easily become a bit too familiar with the very employees they are hired to monitor and neglect to follow proper procedure for things such as employee badge scanning, equipment check-out and return, inventory audits, etc. This can lead to major security breaches and result in thousands of dollars of losses to your company.


Finally, the hiring and firing of your own security staff can become yet one more burden for your business. Most companies do not understand the security industry well enough to properly screen and interview a potential security guard. They are also rightfully focused on their business and typically too busy to learn. Additionally, if a client is unhappy with an outsourced security guard, they need only contact the security company and the guard can be replaced within a matter of days. In contrast, dismissing one’s own security guard will leave a gap that can take weeks or even months to fill, all the while compromising the business’s security operations due to inadequate staffing.


Conclusion

As you can see, there is no “one-size-fits-all” approach to hiring security. And, while we encourage all of our potential clients to consider the various drawbacks of direct hire security, we always offer objective guidance that is in the client’s best interest, whether that means security should be kept in-house or outsourced to a company like us.