Daily Black Immigrant News
Financial analyst Dennis Chung is suggesting that the latest ruling by the Revenue Court, which effectively means security guards are now entitled to the benefits offered to people categorized as employees, could work against them as companies seek to cover the increased cost of providing the service.
Rising costs could cause security firms to cut staff as their clients adopt technology solutions to satisfy their security needs instead of manpower, Chung said.
“I think it will, effectively, work more against the security guards themselves than the actual companies, because they will find something else that has a greater return on capital,” Chung reasoned.
The Jamaica Society for Industrial Security (JSIS) has signaled that the cost of private security services could rise by at least 50 percent following the recent landmark ruling by the high court that security guards should be treated as employees rather than contract workers. .
“People will be faced with a decision about their companies. If their customers are not willing to take on the added cost, then there will be no reason to hire anyone,” suggested the financial analyst.
The court ruled that the security guards engaged by Marksman Limited are employees and not contract workers and that the company must immediately start paying its share of the National Housing Trust (NHT) statutory contributions.
NHT challenged the private security firms in court after their refusal to accept the Trust’s declaration that the security guards they hired are employees and not contract workers.
“I’m not surprised about the decision because the labor laws say that if someone is continuously under contract, then effectively you treat them as an employee. So all legal payments must be made,” Chung said.
Employee benefits such as paid vacation and sick leave, which companies are now expected to adhere to, are likely to see some companies cut jobs, he said.
“Depending on how much the costs go up, you may find that they may reduce the number of people they hire,” he said.
“It’s the same argument with the minimum wage when people say it should go up. But how many people will lose their jobs? This is the balancing act that the government has to do … because it is based on affordability,” Chung added.
“Remember that money always follows capital and people will always find ways to organize themselves and make money. It could be as simple as saying: ‘this is no longer a profitable industry, let me sell and go elsewhere,’ he reasoned.
By Tameka Gordon
NewsAmericasNow.com
