Dallas’s Law Taking Effect in Tennessee: Avoid a Mandatory 30 -Day Suspension of Your Liquor License

Adams and Reese LLP

Adams and Reese LLP

With Dallas’s Law taking effect January 1, 2023, folks in the alcohol industry are asking: what do I need to do to comply with the new Tennessee security laws?

The draconian penalty for failing to comply – a mandatory 30-day suspension of both your liquor license and beer permit – has injected fear and an element of panic into the industry.

If you have someone stationed at your front door to card for the drinking age, you most likely need to either:

  1. Engage front door personnel from a licensed security guard company, or
  2. Obtain a security company license for your restaurant, bar or club and train and license your staff.

Who Needs to be Licensed?

The law broadly defines the types of duties that require being licensed as security. Here are two that require licensing:

  • Prevention, observation or detection of any unauthorized activity on private property
  • Enforcement of rules, regulations or local or state laws on private property

The law uses the misleading terms “security guard” and “security officer.” It does not matter what you call your staff.

If a staff member is performing functions that are defined by state law as security, the staff member must be licensed as a security guard and your company must be licensed as a security guard company.

The only alternative is to pay a licensed security guard company to provide security guards for your restaurant, bar or club.

What is Security?

There has been no formal or informal guidance issued about what duties qualify as security. The following is our best guess about a couple of common roles of staff in the hospitality industry:

  1. If door personnel or other staff check IDs at the door and prevent underage patrons from entering, they are acting as security guards and need to be licensed. By preventing entry, the door personnel are performing security guard duties.

A bartender or server carding at the point of sale does not require licensing as a security guard.

  1. An usher that is showing a patron where to be seated is not acting as a security guard.
    An usher that is removing an unruly patron from their seat is acting as a security guard.
    An usher that tells a patron to be quiet or they will call for the police (or security) is not acting as a security guard.

You can read the full text of the Dallas’s Law bill, as well as the entire law in Title 62, Chapter 35 of Tennessee Code Annotated, which includes definitions and details.

Cue Etta James’ 1967 classic song “Security”

Security, yeah yeah
I want some security
I want security, yeah
Without it I'm at a great loss
Yes I am, now
Security, yeah, yeah
And I want it any cost, yes I do now

Staff Training

The new law requires unarmed and armed security personnel to complete four (4) hours of training administered by a certified trainer and pass an examination. At a minimum, the training must dedicate an hour to each of the following subjects: (1) orientation, (2) legal powers and limitations of a security guard/officer, (3) emergency procedures, and (4) general duties.

Within 15 days of employment, the security guard must complete de-escalation and safe restraint training, and a first aid and CPR course. A security guard is also required to complete two hours of refresher training for orientation, legal powers and limitations of a security guard/officer, emergency procedures, and general duties to renew their registration cards. Refresher training for de-escalation and safe restraint is a prerequisite for renewal as well but the law does not specify a time requirement.

The Penalty

Knowingly employing a security guard that is not trained and licensed is a Class A misdemeanor punishable by fine and a one-month suspension for your restaurant, bar, or club’s liquor license or beer permit. The suspension is per violation – per employee.

In criminal law, “knowingly” is a high standard of proof, particularly because the state bears the burden of proof beyond a reasonable doubt.

Who knows how a beer board or the ABC will apply the new law? Do not be the test case and face a 30-day suspension.

Company Licensing

If your business employs staff that act in security roles, as defined by the law, your company must apply for and obtain a security company license, called a proprietary security organization. You must identify and provide information for a manager – the person that will supervise staff performing security.

Additionally, you must provide documentation of insurance coverage in the amounts of $300,000 for personal injury and $100,000 for property damage as required by T.C.A. § 62-35-114, electronic fingerprints of the manager, and a $100 registration fee. There is also a $100 fee paid twice yearly to maintain status as a propriety security organization.

If you have any doubt about your ability to comply with Dallas’ Law, we strongly encourage you to consider hiring a licensed security company.

The new law takes effect January 1, 2023.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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