1099 Independent Contractor Security Guards
The question as to whether independent contractor security guards aka 1099 security guards is acceptable is raised by uninformed individuals looking to make a quick buck rather than educate themselves, engage in business properly, and minimize their exposure to both criminal prosecution (imprisonment), civil actions, and administrative penalties.
Q: May a licensed security guard take on “private clients,” contract for security services or “run” team of staff for clients directly?
A: No. Only a person with a BSIS-issued private patrol operator’s license (PPO) may contract to provide security services. A PPO license is required to provide security services on contract to any person or business. A security guard may not act as an independent contractor to provide security services. A security guard must be employed as an employee of either a PPO, or the person, or business for whom the guard is providing security services. PPOs and employers of security officers must also maintain a general liability insurance policy and a workers compensation insurance policy (if they have employees). PPOs and employers of security officers may not 1099 their employees however (see below).
Q: I am a BSIS licensed security guard (Guard Card). Am I supposed to be issued a 1099 or a W2 from my employer?
A: 1099s are forms issued by companies to independent contractors for services rendered. Guard carded security guards are not allowed to work as an independent contractor. Therefore, security guards must be issued a W2 after completing a W4. The benefit of being classified properly as a W2 is the employee will not be responsible for 6.2% as opposed to the full 12.4% (as of May, 2014) social security taxes, in addition to other state and federal taxes. The major consequence would be the guard is guilty of engaging in the work as if they were a PPO and subject to a misdemeanor charge, $5,000 fine, and up to one year in jail.
In addition, 1099s are not entitled to overtime or double time based on California’s wage laws that employees are. There are also IRS ramifications regarding willful misclassification of employees as 1099.
Q: May a person with a BSIS guard card and exposed firearm permit contract directly with a VIP or celebrity to provide bodyguard services in civilian clothes while carrying a firearm?
A: No. Only a BSIS licensed private patrol operator (PPO) may contract to perform security guard or bodyguard services to any person or business. An licensed individual with a guard card and an exposed firearm permit issued by BSIS may perform armed security guard (bodyguard) duties only as a security guard employee. A BSIS Guard Card holder must be directly employed (W2/W4) by a PPO and assigned to work as a bodyguard for a PPO’s client under contract. In addition, applicable general liability and workers compensation insurance is required.
Q: May a licensed security guard work as an employee (W2/W4) for an employer directly?
A: No. Only a person with a BSIS-issued Proprietary Security Officer may work as an employee for an employer directly. A PSO is defined a proprietary private security officer is a uniformed, unarmed individual who is employed exclusively by any one employer whose primary duty is to provide security services for his or her employer, whose services are not contracted to any other entity or person, and likely to interact to interact with the public while performing their duties.
Q: May an active duty peace officer contract to provide armed bodyguard services?
A: No. Only a person with a BSIS-issued private patrol operator’s license (PPO) may contract to provide security services. A PPO license is required to provide security guard (bodyguard) services on contract to any person or business. A security guard may not act as an independent contractor to provide security services. A security guard must be employed as an employee of either a PPO, or the person, or business for whom the guard is providing security services.
Q: May a licensed PI contract to provide a bodyguard service?
A: No. A bodyguard is a security guard. Therefore, only a PPO may contract to specifically provide a bodyguard service. However, a PI who has a contract with a client, may provide a bodyguard service to the client if that service is peripheral to an on-going PI contract.
An individual must possess a guard card and an exposed firearm permit to be employed as a bodyguard and work in civilian clothes with a concealed weapon.
The laws, rules, and regulations that make up the framework of this information are as follows:
California Business & Professions Code:
7582. No person shall engage in a business regulated by this chapter; act or assume to act as, or represent himself or herself to be, a licensee unless he or she is licensed under this chapter; and no person shall falsely represent that he or she is employed by a licensee.
(c) Notwithstanding any other provision of law, a violation of Section 7582, which is an infraction, is punishable by a fine of one thousand dollars ($1,000).
(a) Unless specifically exempted by Section 7582.2, no person shall engage in the business of private patrol operator, as defined in Section 7582.1, unless that person has applied for and received a license to engage in that business pursuant to this chapter.
(b) Any person who violates any provision of this chapter or who conspires with another person to violate any provision of this chapter relating to private patrol operator licensure, or who knowingly engages a nonexempt unlicensed person is guilty of a misdemeanor punishable by a fine of five thousand dollars ($5,000) or by imprisonment in the county jail not to exceed one year, or by both that fine and imprisonment.
(d) Any person who: (1) acts as or represents himself or herself to be a private patrol operator under this chapter when that person is not a licensee under this chapter; (2) falsely represents that he nor she is employed by a licensee under this chapter when that person is not employed by a licensee under this chapter; (3) carries a badge, identification card, or business card, indicating that he or she is a licensee under this chapter when that person is not a licensee under this chapter; (4) uses a letterhead or other written or electronically generated materials indicating that he or she is a licensee under this chapter when that person is not a licensee under this chapter; or (5) advertises that he or she is a licensee under this chapter when that person is not a licensee, is guilty of a misdemeanor that is punishable by a fine of ten thousand dollars ($10,000) or by imprisonment in a county jail for not more than one year, or by both that fine and imprisonment.
Internal Revenue Service:
Q: How do you determine if a worker is an employee or an independent contractor?
A: The determination can be complex and depends on the facts and circumstances of each case. The determination is based on whether the person for whom the services are performed has the right to control how the worker performs the services. It is not based merely on how the worker is paid, how often the worker is paid, or whether the work is part-time or full-time.
There are three basic categories of factors that are relevant to determining a worker’s classification:
-Behavioral control (whether there is a right to direct or control how the worker does the work);
-Financial control (whether there is a right to direct or control the business part of the work); and
-Relationship of the parties (how the business and worker perceive the relationship).
Based on the definition of a security guard, security guards are 100% defined as employees.
Licensed security guards can work as employees of private companies. In fact when an in-house guard is armed, they are required to have a guard card and firearm permit. Same goes for in-house armed bodyguards. This relationship must be employee/employer rather than independent contractor.
A security guard or security officer, within the meaning of this chapter, is an employee of a private patrol operator, or an employee of a lawful business or public agency who is not exempted pursuant to Section 7582.2, who performs the functions as described in subdivision (a) on or about the premises owned or controlled by the customer of the private patrol operator or by the guard’s employer or in the company of persons being protected.