5 Exit Clauses in Guarding Contracts That Could Cost You

Fahrenheit Security
1 hour ago
4 min read

Who should read this?

If you manage contracts for a commercial property, office site or facilities team, this guide is for you. It helps you spot guarding contract clauses that can quietly lock you in and cost your business more than expected.

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What is an automatic renewal clause and why is it risky?

An automatic contract renewal clause means your guarding agreement continues unless you cancel it within a short, specific window, often thirty to ninety days before expiry. Many businesses miss this deadline, especially when staff change roles or contracts aren't actively tracked.

These clauses, often called evergreen terms, rolling renewals or silent extensions, typically benefit the provider. If not disclosed clearly, they may be challenged, but it's far easier to avoid the issue entirely. Set calendar alerts, assign someone to monitor contract timelines and make sure renewal windows are well known across your team.

To reduce risk, consider a contract review or speak with the Small Business Commissioner. If you're unsure about your renewal terms, ask for them in writing and negotiate a shorter notice period if needed.

Why long notice periods in guarding contracts are more dangerous than you think

A ninety day notice clause sounds straightforward until you realise it only applies once a year, just before the contract anniversary or term end. Miss it, and you're locked in again, even if the service no longer meets your needs.

Ask whether your cancellation period is rolling or restricted to a specific date. Understanding this prevents confusion and gives you freedom to switch providers when needed.

Even a short delay in giving notice can cost thousands. Add key dates to your operations calendar and ask your supplier to confirm them in writing. That small step protects your ability to exit cleanly.

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How termination fees in security contracts can cost more than the service

Termination fees often include up to twenty five percent of your remaining contract. Some providers also charge for:

Predicted profit loss
Hiring or training costs
Admin time to restructure staffing

Without clear terms, these charges come as a surprise. Before you sign, ask to see the termination clause. Run a scenario: if you cancel at the halfway mark, how much will it cost? If the fee outweighs the service, that’s a warning sign. Unfair or hidden fees may breach UK contract law. Reach out to Trading Standards or the Federation of Small Businesses for advice. Avoiding cancellation penalty traps can save thousands.

From the provider's view: Some suppliers say these fees cover upfront staffing or onboarding costs. That may be true but the details should always be clearly laid out and fair.

What happens when you want to cancel due to poor service but can’t prove it?

Poor performance doesn’t always mean you can cancel. If your guarding contract lacks a detailed SLA, proving a breach becomes difficult.

To protect your position, build a clear record. Track and keep copies of:

Missed patrols
Written complaints
Incident logs
Delayed or missed follow ups

Most contracts have a remedy clause, giving the provider time to improve before you can exit. If you can't show that they've failed, the clause may be enforced.

Build a paper trail early. It strengthens your case if you decide to leave.

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How no break clauses lock you in even if the service goes wrong

Some contracts prevent cancellation during the first year. This no break clause is often buried in the mobilisation or commitment period.

You may be unable to leave, even if the service fails to deliver. For example:

The guard misses multiple patrols
SLAs are repeatedly breached
Response times fall short of agreement

These clauses are justified by providers as covering recruitment and training costs. But you can push back. Ask for a six month checkpoint or a shorter commitment before signing.

If a no break clause wasn't explained clearly, you might be able to challenge it with legal support or mediation. Hidden first year no exit clauses create unnecessary financial risk.

Before You Sign: Key Contract Traps to Check

Use this checklist to scan for hidden risks before signing any guarding agreement:

Is there an automatic contract renewal or rolling extension clause?
When does the notice period open, and how long is it?
Is there an early exit charge, and how is it calculated?
Does the SLA outline response times and service expectations?
Is there a right to remedy clause that delays cancellation?
Does the contract have a no break clause in the first year?
Are SIA licensing and performance requirements mentioned?

Ask your supplier to explain these in plain English. If the answers are vague, consider getting a legal or compliance review.

How to spot these clauses before you sign a guarding contract

Before you commit, check the agreement for:

Automatic renewal terms
Fixed term notice periods
Early exit charges
Service remedy conditions
Year one lock in or mobilisation limits

Ask questions until you're confident. If the answers are unclear or feel rushed, step back. You can also get a third party contract review from the Small Business Commissioner or a legal advisor.

Create a contract calendar with renewal dates and notice deadlines. Assign someone on your team to keep it updated. Use supplier exit tracking tools or shared checklists.

Guarding contracts often include terms like security contract rollover or cancellation window. These can be buried in the small print and limit your flexibility.