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Normally this possible exposure would be present when over half the contract service's business is with one client company. It is highly recommended that if this possibility exists, the client company consult with a competent labor attorney, whose input can be beneficial in evaluating this potential risk.
Litigation alleging negligent security, failure to provide adequate security, loss control negligence, premises liability and related matters have been on the rise for some time. It is not enough for the client company to simply contract the security out to the low bid without taking logical and reasonable steps to insure that the provider is capable of providing a level of security which is adequate for the risk. While some naïve business managers may believe that by contracting the security to an outside service, they are immunized from such litigation, this is not the case regardless of assurances in the contract. It has often been held that the client company is responsible for insuring that a reasonable level of security at the facility exists and can be held negligent if it fails in its duty use reasonable and applicable selection procedures when contracting with an outside service.. This vicarious liability could be compared to income tax situations where, the taxpayer is held responsible for errors made by a tax preparation service.
Regardless of the risk of litigation, it just makes good business sense to handle the selection process in a manner that will result in obtaining good professional security service. There have been many cases where contract service officers have been credited with saving lives and preventing disasters which would have had devastating effects on their clients' businesses. On the other hand, in some cases where the client was negligent in this area, hazards have been created by the contractor.
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