What is the Modern Slavery Act?
The Modern Slavery Act 2015 aims to combat two of the biggest human rights challenges of our time, the crimes of slavery and human trafficking. Under the Act, certain businesses have a legal duty to ensure that slavery and human trafficking are not taking place anywhere within their organisation or in their wider supply chains.
Is my business affected?
The Act introduced a new obligation for certain organisations to report on the steps they are taking to combat slavery and human trafficking. Any organisation that carries on a business (or part of a business) in any part of the United Kingdom and has an annual turnover of £36 million or more has a legal obligation to comply with this requirement.
What action does my business need to take to comply?
All affected businesses with a financial year ending on or after 31 March 2016 are required to publish a slavery and human trafficking statement for each financial year of the business. Government Guidance encourages businesses to do so within six months of the end of the relevant financial year. The statement, designed to achieve supply chain transparency, should disclose either: (1) the steps your organisation has taken during the financial year to ensure that slavery and human trafficking are not taking place in any part of your business or your supply chain, or (2) that your business has not taken such steps. Whilst your business would, in theory, fulfil this requirement by publishing a statement to the effect that it had not taken any steps, it is unlikely that many organisations will pursue this option given the reputational damage that may arise from doing so.
What should be included in my business's statement?
Whilst there are no hard and fast rules with regard to what should be included in a business's slavery and human trafficking statement, the statement should clearly set out what steps your organisation has taken to ensure that slavery and human trafficking is not taking place in your own business or within your supply chains. It may be appropriate to include details of:
- your organisation's business, structure and supply chains;
- any policies relevant to slavery and human trafficking that have been implemented to combat such practices;
- any due diligence your business has undertaken in relation to slavery and human trafficking in your business and supply chains;
- the parts, if any, of your business and supply chains where there is a risk of slavery and human trafficking taking place, and the steps your business has taken to assess and manage that risk;
- your business's effectiveness in ensuring that slavery and human trafficking is not taking place in your business or supply chains measured against performance indicators; and
- relevant staff training.
Is there a process for publishing the statement?
The statement must be approved by the board of directors and signed by a director before it is published. Once approved and signed, the slavery and human trafficking statement should be published on the company's website, with a prominent link to it on the website's homepage so that it is easily accessible to the public.
What are the penalties for failing to comply?
The Secretary of State can bring proceedings for a High Court injunction against organisations that do not comply with the slavery and human trafficking statement requirements. Failure to comply with an injunction would result in contempt of a court order and is punishable by an unlimited fine. In addition, businesses that fail to publish a slavery and human trafficking statement risk adverse publicity and reputational damage.
What should staffing companies do?
The recruitment industry's reputation is already tarnished by reports of recruiters who offer workers promising jobs that turn out to be exploitative. Reputable staffing companies must dispel this image.
Obviously staffing companies that meet the minimum turnover requirement should take the action outlined above if they have not already done so. Staffing companies with an annual turnover of less than £36 million are recommended to take steps to ensure that slavery and human trafficking are not taking place within their business or supply chains. This will provide reassurance when pitching for contracts with clients and to join preferred supplier lists, particularly in relation to public sector tenders.