Breaking the chain - government steps up fight against modern slavery

As home secretary, Theresa May was a strong advocate of the UK increasing its efforts to counter modern slavery. While it's clear that May will continue that passion as prime minister, Amber Rudd has now taken up the mantle of responsibility on the issue as current home secretary. 

Writing in the Sunday Telegraph on the drive to end modern slavery, May called it "the great human rights issue of our time". As prime minister she said she was determined that the UK would "make it a national and international mission to rid our world of this barbaric evil. Just as it was Britain that took an historic stand to ban slavery two centuries ago, so Britain will once again lead the way in defeating modern slavery and preserving the freedoms and values that have defined our country for generations,” May pledged.

With such a strong political ally on their side, the new home secretary Amber Rudd and the UK’s independent anti-slavery commissioner Kevin Hyland will continue efforts in support of the Modern Slavery Act 2015, which extends the required compliance to the supply chain. On 1 August, Rudd and Hyland joined charities leading on the issue to ensure that the act does lead to the end of slavery in modern times, establishing a taskforce, reviewing police response, and establishing £33.5m in development assistance to counter slavery in countries where victims are from. Clear emphasis was placed on continuing to enforce and continue progress made through the act.

The act applied to at least 12,000 companies from 1 October 2015, with a staged implementation for other companies. Transparency in supply chain provision in the act is seen by government as a ground-breaking measure as it recognises the important role business can play in tackling the scourge of modern slavery and encourages them to do more. By requiring businesses to disclose what they are doing to eliminate slavery in their supply chains, the government is providing a strong incentive for businesses to take the issue seriously.

The International Labour Organization estimates that worldwide there are approximately 21 million victims of forced labour, defined as the non-voluntary work or services of an individual that are extracted under potential penalty risk. Of these victims, an estimated 10.7 million are in private enterprises covering agriculture manufacturing, construction, mining and utilities. A portion of these individuals are likely to be within or connected to a UK supply chain.

While supplying companies may be contractually obligated by those they supply to abide by ethical trading policies, without a full understanding of the complete supply chain, it is quite easy to be in a situation where the act is violated. For instance, in the first prosecuted case of company violations, Kozee Sleep, the violations occurred despite the supplier being used by the UK’s largest high street stores, who themselves carry out regular ethical audits, and maintain ethical trading policies, which were in the defendant’s contract to supply the product. Kozee Sleep’s violations were proven to be unknown to retailers.

For industries with a number of supply chains, infrastructure and construction among them, the Modern Slavery Act is a potential risk if not handled appropriately. This is not only risky due to supply chains that differ from project to project, but also due to misunderstanding about what measures must be taken to ensure a supply chain is not in violation.

Many companies already opt to include ethical considerations, of varying degrees, within their procurement processes, and this will add to the momentum behind social responsibility being a necessary business consideration, with there being a clear business as well as legal case for compliance.

With the implementation timeline of the Modern Slavery Act 2015 kicking into full gear in April 2016, it is vital that businesses are in the know. Likely changes for business processes include developing relevant corporate policies, processes to investigate or verify information about supply chains, a process for addressing risks or issues within the supply chain, and appointing individuals responsible for compliance.

Section 54 of the Modern Slavery Act 2015 stipulates that all commercially driven organisations, with annual turnover exceeding £36m, are required to make available a ‘slavery and human trafficking statement for each financial year’, with the alternative being a direct statement from the corporation that there have been no steps taken in this regard. 

The annual statement a company is required to produce must address a full list of organisational details that are available in Section 54(5). These are: 

(a) the organisation’s structure, its business and its supply chains;

(b) its policies in relation to slavery and human trafficking;

(c) its due diligence processes in relation to slavery and human trafficking in its business and supply chains;

(d) the parts of its business and supply chains where there is a rick of slavery and human trafficking taking place, and the steps it has taken to assess and manage that risk;

(e) its effectiveness in ensuring that slavery and human trafficking is not taking place in its business or supply chains, measured against such performance indicators as it considers appropriate;

(f) the training about slavery and human trafficking available to its staff.

Organisations with a financial year ending between 29 October 2015 and 30 March 2016 will not be required to produce a statement for the financial year 2015/16. Organisations with the end of financial year occurring 31 March 2016 or after will be legally required to produce a statement for the financial year of 2015/16, published within six months of the organisation’s financial year end.

To help with compliance, a practical guide has been published to take businesses through the process to ensure that not only are requirements met, but that the organisation understands the importance, as well as suggested action if modern slavery is encountered. The current home secretary has power to bring civil proceedings against violators in the high court and business leaders, if found in violation of sections 1 or 2, will also be entangled in criminal proceedings. 

Now more than ever, corporate responsibility is being enforced formally under the law, as well as informally through business pressures from supply chains and consumers, pushing businesses to consider all business impacts. It is through such a multifaceted approach that the act will strive to bring an end to modern day slavery.