A security services tender that awards the contract to the lowest financial bid is, in practice, a tender that rewards the bidder who omits the most statutory cost. Manpower contracts have an unusual cost structure: the greater part of every bid is wages and mandatory levies that are fixed by notification and common to all bidders, so a quotation materially below the statutory floor can only be achieved by not paying, not remitting or not deploying something the contract requires. This guide sets out a tender format in which compliance is priced and evidenced before price is compared, so that a bid cannot win by being incomplete.
The document is written for facility, procurement and administration heads in Mumbai, Pune, Thane, Navi Mumbai, Nashik and Nagpur who issue or review security tenders for offices, residential societies, campuses, logistics sites and industrial premises. It covers the structure of the tender, a three-stage evaluation, a scoring matrix, the cost-floor test, the clauses that make compliance verifiable during the contract, and a submission checklist for bidders.
Why price-only evaluation fails for manpower contracts
In a supply tender, two bids for the same item differ mainly in margin and efficiency. In a manpower tender, the deliverable is a deployed person for a stated number of hours, and the principal cost components are set outside the bidder’s control.
- Wages. The minimum wage for the category and zone is fixed by notification, and the Maharashtra Security Guards Boards publish a consolidated monthly rate order for guards in each board area, revised in January and July. The order in force for the contract period governs; a prior-period order is not a valid reference.
- Employer contributions. Provident fund (employer share 12 per cent of the applicable wage) and employees’ state insurance (employer share 3.25 per cent, on wages up to the Rs 21,000 monthly ceiling) are statutory. Neither is negotiable.
- Board levy and licence-linked costs. A licensed agency in Maharashtra carries levies and compliance costs specific to the guard board framework, which are included in the Board’s rate order.
- Relief and leave. Weekly off, public holidays and absence cover require additional headcount that exists only if it is costed.
When these components are summed, the remaining variable portion is the bidder’s service charge and supervision cost. A bid that undercuts the sum of the fixed components is therefore not more efficient than its other bidders; it is silent on one or more of them. The usual silent items are the Board levy, relief headcount, uniform and equipment, supervisor time, and the employer’s share of provident fund and insurance contributions on the full wage rather than on a reduced base. The financial outcome is predictable: the client pays the contractor’s quoted price and remains the principal employer, with residual liability for unpaid statutory dues in respect of workers on its premises.
The sections below explain how to prevent this at the tender stage. For the underlying arithmetic of a guard post, see the guide to security guard cost in Maharashtra, and to model a specific deployment use the security cost calculator.
Structure of the tender document
A security services tender is easier to evaluate fairly when the document separates what the client requires from how bidders are judged. The following sections are recommended, in this order.
Section A: scope and deployment schedule
Define the post list rather than a headcount. Each post is stated with its location, hours, days, number of persons, grade (guard, head guard, supervisor, security officer) and principal duties. Duties should be written as operational tasks: access control at the gate, visitor registration, vehicle and material gate-pass checks, patrol rounds with recorded checkpoints, key control, incident logging and escalation. Stating the duties allows the bidder to price supervision and relief against a defined task list, and it allows the client to audit performance against the same list.
State the shift pattern, weekly-off arrangement and the relief expectation explicitly, including whether relief personnel are to be additional to the post strength. A tender that leaves relief unstated obtains bids that price it differently, which makes them non-comparable.
Section B: eligibility and mandatory documents
Eligibility conditions are pass or fail and are assessed before any scoring. Recommended conditions are listed in the table below, together with the evidence a compliant bidder should be able to produce. Statements of compliance without evidence are not accepted at this stage.
| Eligibility condition | Evidence required with the bid | What the check confirms |
|---|---|---|
| Valid licence under the Private Security Agencies (Regulation) Act, 2005, covering the state or district of deployment | Copy of licence showing validity and territorial scope; confirmation of verification on the issuing authority’s records where available | The bidder may lawfully supply guards at the site |
| Registration under the provident fund and employees’ state insurance schemes | Registration codes; challans and returns for the last twelve months | Contributions are being remitted, not only registered |
| Registration with the applicable security guard board for the area of deployment | Board registration and the most recent levy payment receipts | The Board levy is being paid on current deployments |
| Contract labour licence, where the engagement requires it | Licence copy and registers format | Statutory registers are maintained |
| Tax registrations | GST registration and the last three filed returns | The bidder is an active, filing entity |
| Experience of comparable sites | Work orders or completion certificates for a stated minimum number of similar sites, with client contact details | The bidder has operated at comparable scale |
| Affidavit of wage and statutory compliance | Notarised undertaking to pay not less than the notified minimum wage and to remit all statutory contributions on time | Gives the client a contractual basis for recovery |
The licence and its scope deserve particular attention; the compliance and licences page lists what a licensed agency should be able to show on request. Where a document is stated as pending, the bid should be treated as non-responsive and not conditionally accepted, because conditional acceptance converts a pass or fail test into a negotiation.
Section C: technical submission
The technical submission describes how the bidder will perform the scope. It should require named content rather than general statements: the recruitment and background verification process, the training schedule and who delivers it, the supervision model (frequency of supervisory visits, supervisor to post ratio), the reporting format and frequency, the escalation matrix, the arrangement for emergency replacement and the time within which a vacant post is filled. Each item is scored against the matrix below.
Section D: financial submission
The financial bid should be submitted on a prescribed breakdown, not a single monthly figure. The breakdown separates wages by grade, relief provision, employer provident fund and insurance contributions, Board levy, uniform and equipment, supervision, management fee and tax. A bid that is not submitted on the format is returned. The format is what allows the cost-floor test described below to be applied mechanically.
Three-stage evaluation
Stage one is eligibility, pass or fail. Stage two is the technical evaluation, scored, with a minimum qualifying score. Stage three is the financial evaluation, applied only to bids that qualified at stage two, and only after the cost-floor test. Keeping the stages sequential prevents price from influencing the assessment of quality and prevents a low price from being considered before the bid has shown it can be delivered.
The scoring matrix
The weights below are an illustrative starting allocation for a mid-sized commercial or residential contract, not a statutory prescription. A client with higher operational risk may move weight from price to technical; the principle is that price carries a minority of the total score and is applied only to compliant bids.
| Stage | Criterion | Maximum score | How it is scored |
|---|---|---|---|
| Technical (60) | Experience at comparable sites | 15 | Number and scale of verified comparable deployments; reference calls made by the client |
| Recruitment, verification and training plan | 15 | Documented process, background verification steps, induction hours, refresher schedule | |
| Supervision and reporting model | 15 | Supervisor ratio, visit frequency, sample report, escalation matrix | |
| Continuity and replacement | 10 | Time to fill a vacant post, relief pool, attrition figures for current contracts | |
| Site understanding | 5 | Evidence of a site visit; risk observations specific to the premises | |
| Financial (40) | Price of the compliant bid | 30 | Formula-based: lowest compliant price divided by the bid price, multiplied by 30 |
| Completeness and transparency of the cost breakdown | 10 | Every statutory line present, correctly computed and reconcilable to the notified rates |
The formula in the price row uses the lowest compliant price, that is, the lowest price among bids that passed the cost-floor test. Using the lowest price among all bids would allow a non-compliant bid to set the benchmark and depress every other bidder’s price score.
The cost-floor test
Before the price formula is applied, the evaluator computes a statutory floor for each bid. The floor is not a market estimate. It is the sum of the items that are fixed by notification for the contract period, applied to the post list in the tender.
- Take the monthly rate for each grade from the Board’s order in force for the period of the contract. The order on file must be the one covering the dates in question; where the tender spans a January or July revision, both orders apply to their respective periods.
- Multiply by the number of posts and the relief factor implied by the shift pattern and weekly-off arrangement stated in Section A.
- Add employer provident fund and insurance contributions at the statutory rates on the applicable wage.
- Add the Board levy as stated in the order.
- Add tax on the sum as applicable.
A bid whose breakdown totals less than this floor is non-responsive unless the bidder reconciles every difference line by line in writing. The reconciliation should be examined, not assumed. A reduced relief factor, a wage base below the notified rate and contributions computed on a reduced base are each a failure to meet the specification, not a discount.
A related safeguard is a requirement to explain abnormally low bids. Where a bid falls below the median of the compliant bids by a stated margin set in the tender, the bidder is asked to justify the price with the cost breakdown and the evidence supporting each line. The margin should be written into the tender in advance so that the test is applied uniformly to all bidders.
Clauses that keep compliance verifiable during the contract
A tender that is evaluated correctly can still be undermined if the contract does not require continuing evidence. The following clauses make compliance observable on a monthly cycle.
Payment against statutory evidence
The monthly invoice is accompanied by the previous month’s provident fund and insurance challans and returns for the personnel deployed at the site, the wage register or bank transfer statement showing payment of at least the notified wage to each deployed person, and the Board levy receipt. Payment is released against this evidence. Government manpower tenders commonly adopt this approach, requiring contractors to furnish remittance challans with the next bill, and the practice transfers readily to private clients.
Wage payment by bank transfer
Wages are paid to each worker’s bank account, and a statement is provided monthly. Cash wage payment prevents verification and is the usual mechanism through which a notified wage is reduced in practice.
Revision pass-through
The contract states how a revision of the Board’s order will be applied. A clear clause is that the contract price is revised from the effective date of the new order by the documented change in the statutory components only, with the service charge unchanged. This removes the incentive to under-price at the outset in expectation of renegotiation.
Right to audit and retain
The client has the right to inspect registers, attendance, wage records and contributions for personnel at its site, and to withhold an amount equal to any unremitted statutory liability until evidence is produced.
Service-level measures
Specify measurable service levels: vacant post filled within a stated number of hours, supervisory visit frequency, patrol round completion against checkpoints, report submission deadlines, and the incident reporting time. Each is stated with a consequence, such as a deduction proportional to the post-hours not covered. Deductions for unfilled post-hours align the contractor’s cost with the delivered service.
Role boundaries
Define the guard’s role as observation, access control, reporting and escalation to the site manager and to the relevant public authorities. The scope should describe the guard as an observer and reporter and should not attribute enforcement powers to contract personnel, since those rest with public authorities and sit outside the licensing framework; writing them into a scope creates liability for the client.
Common drafting errors
The errors below recur in security tenders and each allows non-comparable bids.
- Headcount stated without hours. A tender for “ten guards” does not state whether those are post-hours or persons, or whether relief is additional.
- No rate reference date. If the tender does not name the Board order that applies, bidders use different orders.
- Single-figure financial bid. Without a breakdown, the floor test cannot be applied.
- Lowest price among all bids as the benchmark. This lets an incomplete bid set the price score for everyone.
- Evidence deferred to after award. Documents requested only from the winner cannot disqualify anyone.
- Unweighted technical submission. Where technical content is read but not scored, it has no effect on the result.
Evaluation checklist for the client
- The post list, hours, grades and relief requirement are stated in Section A.
- The Board order that applies, by date, is named in the tender.
- Eligibility conditions are pass or fail and each has a named document.
- Bids that state a document is pending are treated as non-responsive.
- Technical scores are recorded by criterion before envelopes with prices are opened.
- A minimum technical score is set for entry to the financial stage.
- The financial format separates wages, relief, contributions, levy, supervision, equipment, fee and tax.
- The cost-floor test is applied to every bid and recorded.
- The price formula uses the lowest compliant price.
- The abnormally low bid threshold and the explanation procedure are written in the tender.
- References are contacted for at least the leading bidders.
- The contract carries payment against statutory evidence, bank-transfer wages, revision pass-through, audit rights and service-level deductions.
Submission checklist for bidders
A bidder preparing to respond to a tender of this format should assemble the following before the submission date: licence copy with territorial scope; provident fund and insurance registration and twelve months of challans; Board registration and levy receipts; contract labour licence where applicable; tax registrations and returns; experience certificates with contactable references; the signed wage and compliance affidavit; a technical note answering each criterion in the matrix; a site visit record; and the financial breakdown, reconciled to the notified rates for the contract period. Preparing these in advance shortens the response time and avoids rejection on form. Guidance on assessing a prospective agency against the same criteria is set out in the guide to choosing a security agency in Maharashtra.
Applying the format to a smaller engagement
Not every engagement warrants a formal tender. For a single-post or two-post requirement, the same logic can be applied in a request for proposal of one or two pages: state the post list and hours, name the rate order, ask for the cost breakdown and the licence and contribution evidence, and compare compliant proposals on supervision and continuity before price. The cost-floor test remains the central control and can be applied with a spreadsheet or the security cost calculator.
Requesting a compliant proposal
Bryte Guard Force responds to tenders and requests for proposal with a cost breakdown reconciled to the rate order in force, a written proposal within 48 hours of a site risk assessment, and the licence and contribution evidence described above. To obtain a proposal against your own specification, use the quote request form.