You may be aware that the Modern Slavery Act 2015 comes into force later this year; this is likely to happen in October. The Act increases the maximum jail sentence for the most serious offences in relation to slavery and human trafficking from 14 years to life. Amongst other things, it also makes provision for the compensation of victims out of the confiscated assets of offenders, gives victims a defence where they are compelled to commit a crime, and gives courts power to make orders to prevent slavery and human trafficking. So far, this should all (hopefully) be irrelevant to your business.
What the Act also does, however, is oblige any commercial organisation which supplies goods or services and has a global turnover of at least £36million to prepare a slavery and human trafficking statement for every financial year.
The statement needs to explain the steps the organisation has taken during that financial year to ensure that slavery and human trafficking is not taking place in any of its supply chains and in any part of its own business. Alternatively, it may state that no such steps have been taken.
The statement may include information about:
- The organisation’s structure, its business and its supply chains;
- Its slavery and human trafficking policies;
- Its due diligence processes in relation to slavery and human trafficking in its business and supply chains;
- The parts of its business and supply chains where there is a risk of slavery and human trafficking taking place, and the steps it has taken to assess and manage that risk;
- 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;
- The training about slavery and human trafficking available to its staff.
A statement must be approved by the board of directors and signed by a director. It must be published on the organisation’s website and a prominent link placed on the homepage. If an organisation does not publish a statement, the Secretary of State may apply for an injunction requiring it to do so.
Guidance will be published in October on how to comply, including the kind of information that may be included in the statement. For organisations with financial years ending close to the law coming into force, there will be transitional provisions. However, a more complex business that intends to audit its supply chain fully should start the process and consider what policies and training it requires.
There is no requirement for an organisation to take any steps to ensure its business and supply chains are free from slavery and human trafficking. The risk of reputational damage is assumed to provide sufficient incentive for large companies to take these issues seriously and integrate measures into their wider CSR strategy.