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Eddy Stam
Apr 2 2024

With more than 30 year of experience working to defend the rights of workers around the world, Eddy Stam, the former head of the sector dealing with the private security industry at UNI GLOBAL UNION addresses a critical question for millions of security guards: how to subsist with some of the lowest salaries in the job market, often below minimum standards. Arguably, decent salaries and working conditions would not improve the dignity of guards but it would also go a long way in improving the performance of the private security sector and, ultimately, the provision of responsible security services.

 


 

Around the world people in low-paid jobs struggle to make ends meet. Although many countries do have a legal minimum wage, too often we hear about people working extra hours or having two jobs to pay the bills. There is an old joke where the president of a big country brags at the dinner table about how many jobs he created. “Yes, I know, I have three of them,” the waiter commented. Unfortunately, this joke is close to reality for many. I was in several discussions with employers and governments about reducing 72  hours working weeks to a more decent 40 hours. But for workers, this is not a discussion about hours, but about income. If a 40-hour week does not foot the bill, they work more hours. We might conceive the concept of a living wage, something that popped up in campaigns in New Zealand and the UK. But in fact: Aristotle already saw self-sufficiency as as a requirement for happiness, which he defined as: ‘that which on its own makes life worthy of choice and lacking in nothing.”

A living wage

Crafting a living wage demands thoughtful effort and decision-making. Nevertheless, the entitlement to a job that supports one’s livelihood is an undeniable human right. According to Article 23 of the United Nations Universal Declaration of Human Rights, “every individual who works has the right to just and favourable remuneration to ensure such a person and his or her family an existence in dignity.” It is distinct from a minimum wage, embodying the fundamental human right to afford housing, sustenance, education, healthcare, childcare, and savings.

Defining a living wage involves a nuanced assessment of basic needs, which become broader as cultures develop. Once established, this definition serves as the foundation for quantifying the wage. National statistics like the Consumer Price Index (CPI) offer reference points, yet the variations in calculation methods and consumer baskets necessitate careful consideration. Additionally, evolving needs and tax structures, alongside regional disparities in prices, add complexity to this endeavour.

The law of supply and demand

Regrettably, the private security sector, driven by market competition, places a strong emphasis on pricing. Clients ultimately dictate the value of services, sometimes driving prices to unsustainable lows. Consequently, there’s a perpetual downward pressure on wages, which forms the bedrock of service costs.

The law of supply and demand undeniably shapes the pricing of services provided. In the realm of private security, the industry’s relatively low barriers to entry have led to an abundance of service providers, resulting in a surplus of supply compared to demand. In most countries, some basic professional qualifications and a clean criminal record are enough to obtain a licence. It is a type of business that does not require big investments.  Yet, this economic principle extends to the labour market as well. 

In the current landscape, labour shortages are becoming increasingly prevalent and are expected to persist due to demographic shifts and an ageing workforce. This poses a significant challenge for private security firms in their quest to recruit and retain skilled professionals. While some speculate that ongoing technological advancements and the integration of AI may alleviate staffing concerns, I hold the belief that technical solutions have their limitations. Camera’s sensors and AI might detect and deter, but at the end of the day, it is human intervention that reunites a crying child with his mother or apprehends a culprit that was detected but was not deterred.  Human expertise and presence will remain indispensable, not to mention the scarcity of skilled developers in this rapidly evolving field. So, providing a living wage is not only a moral obligation but a necessity to attract adequate staff.

The minimum- living wage gap

In many economies, a statutory minimum wage serves as the lower threshold. While instances of undercutting this limit exist, the prevailing model generally entails minimum wage plus costs and profit as the minimum invoice amount.

However, a minimum wage often falls short of a living wage. Consider, for instance, South Africa, where the minimum wage is R25.42 (USD 1.34) per hour, equating to R4406.13 (USD 232.27) monthly on a 40-hour workweek. In contrast, estimated living wages stand at R6,700 for an individual and R10,630 for a family. Similarly, the United States presents a range of minimum hourly wages, from USD 7.25 to USD 15.20, with the calculated living wage at USD 25.02.

Where the ILO already set a standard in 1970 by Minimum Wage Fixing Convention 131 recently the EU launched DIRECTIVE (EU) 2022/2041 on adequate minimum wages in the European Union building on that convention and emphasizing the importance of collective bargaining to reach the level of adequacy. This directive is based on the European Social Charter, which “recognises the right of all workers to a fair remuneration sufficient for a decent standard of living for themselves and their families. It also recognises the role of freely concluded collective agreements, as well as of statutory minimum wage-setting mechanisms, to ensure the effective exercise of this right, the right of all workers and employers to organise in local, national and international organisations for the protection of their economic and social interests and the right to bargain collectively”. This basically acknowledges the existence of a gap between statutory minimums and a living wage.

A race to the bottom: Wages in private security

Given that a significant portion of private security personnel earn close to the statutory minimum wage, their payslips may infringe on their fundamental human rights. To make ends meet, these workers often resort to extended work hours or pooling incomes. As part of ICoCA’s recent research on working conditions in private security, surveys on working conditions were conducted in East Africa. They indicated that 22% of personnel in Tanzania take on a second income-generating activity, 45% work 7 days a week and 85% work 12-hour shifts. Conversations with stakeholders suggest that the practice of taking on additional jobs to make ends meet might be even more widespread in other places. In Uganda, 73% of those surveyed reported working 7 days a week and 78% reported working 12-hour shifts. In Kenya, half of the guards surveyed work 7 days a week while an astonishing 96% report working 12-hour shifts. In ICoCA’s global survey conducted on working conditions, over half of the guards surveyed reported working 12-hour shifts

In light of this, private security firms must reflect on their identity. Are they willing to prioritize profit at the expense of their workforce, or will they shoulder responsibility and refrain from engaging in a race to the bottom? While it’s true that raising service prices may lead to tender losses to less scrupulous competitors, collective bargaining provides a legal avenue to elevate the lower threshold. A sector-wide agreement sets a fair competitive baseline, while a company-specific agreement could and should align with industry peers through coordinated bargaining.

For a deeper dive into the nuances of gender diversity within the private security industry, it is recommended to view the full report. It offers comprehensive insights and data that shed light on current trends and challenges. Read the full report here: ARP Final Report – Ensuring Responsible Security Through Gender Diversity

In practice

In 2004, I spearheaded a campaign aimed at bridging the gap between real wages and a living wage for 140,000 cleaners in the Netherlands. At the time, the established hourly wage stood at €8.33, and we advocated for an increase to €10—an ambitious 20% raise. Despite dire predictions of impending economic woes, including concerns about clients refusing to comply, companies facing bankruptcy, and potential job losses, we pressed forward.

To gauge sentiment, we conducted a survey among 200 major clients, revealing a surprising level of support for our cause. Armed with this knowledge, and recognizing the need for synchronization between tender contracts and wage adjustments, we meticulously prepared the market for this transformative shift. Alongside high-profile public demonstrations, we engaged in intensive lobbying efforts targeting politicians, policymakers, institutional clients, and the broader public.

Over the course of four years, through a series of strategic steps, employers eventually acceded to the €10 hourly minimum. Remarkably, none of the doomsday scenarios materialised. The overall contract volume remained stable, while revenue experienced a notable uptick.

Collective bargaining is key.

As I approach retirement, I emphasize the significance of collective bargaining in counteracting the pressures exerted by clients and competitors. Over my career, I concluded many collective agreements in different sectors. And in my experience, decent wages never lead to a collapse of business. It leads to higher revenues, less turnover, and relatively lower overhead and transaction costs.  

 

 

 

 

The views and opinions presented in this article belong solely to the author(s) and do not necessarily represent the stance of the International Code of Conduct Association (ICoCA).