A slave to new law
Does your organisation have a turnover of £36million or more? Are you a supplier to an organisation which has a turnover of at least £36m? Do you provide goods or services to an organisation who is, in turn, a supplier to a business which has such a turnover? If you answer “yes” to any of these questions, read on as you probably need to produce a Modern Slavery and Human Trafficking Statement.
Why should I bother?
If you are a large organisation (being one that has a minimum annual turnover of £36m), there is a new legal obligation to publish a public statement on your website about the actions that your business has taken to ensure that the business and your supply chains are free of slavery and human trafficking.
If you are part of the supply chain to a large organisation, it is highly likely that you will be asked to confirm the steps that you take to ensure your business operations are slavery and trafficking free.
Surely slavery and trafficking is not problematic?
In 2014, the Global Slavery Index by the Walk Free Foundation estimated there were 35.8 million victims of slavery across the world.
Slavery and human trafficking can take many forms, from compulsory or forced labour to exploitation or servitude. It was estimated by the Home Office in 2013 that there were between 10,000 and 13,000 victims of modern slavery in the UK.
What should a Modern Slavery and Human Trafficking Statement include?
The statement should include details of all the actions that your organisation has taken during the financial year to ensure that slavery and human trafficking is not taking place in any part of its own business and in any of its supply chains. There is no set format that the statement must take but you will probably want to include the following:
- details about your corporate structure and supply chains and in particular the risk areas specific to your business;
- your due diligence process and the measures you have taken to ensure that slavery and trafficking is not taking place (for example, you may have insisted on appropriate warranties being included in your commercial supplier contracts, you perhaps have conducted site visits of your suppliers premises to check the conditions of their workforce and/or provided training to your staff so that they are vigilant as to the signs); and
- the ways in which you will continue to monitor the situation going forward.
If your organisation does not take any anti-slavery or trafficking actions, you are required to publish a statement to that effect. Such an admission could result in embarrassment so think hard before doing so.
What should I do with the statement?
The statement should be formally approved (for example, approved by the Board of Directors and signed by a director) and then published on your organisation’s website, with a prominent link to the statement on your home page.
When should I do this?
As soon as possible as the new obligation is already in force, with organisations whose financial years end on or after 31 March 2016 being required to publish a statement as soon as practicable after their financial year end. You will then need to update your statement each financial year thereafter.
What happens if I don’t produce a statement?
If you do not have a statement it is likely to result in potential reputation and brand damage issues which could lead to loss of business (as it is probable that others will not wish to conduct business with organisations who are not publically committed to ensuring their business and supply chains are free from slavery and trafficking). The Home Office may also commence proceedings to compel your organisation to produce such a statement.
So, what should I do in practice?
- Assess your own business to ensure that it is slavery and trafficking free;
- Map out your supply chain and carry out the necessary due diligence on each of them – which is likely to involve asking them to provide you with a copy of their statement;
- Produce your Modern Slavery and Human Trafficking Statement, get it approved and publish it on your website, adding a link to it on your home page; and
- Continue to review and update your statement periodically and certainly at your financial year end.
Where can I find out more?
The Home Office has published some guidance which can be found at www.gov.uk/government/collections/modern-slavery.
This guide is for general information and interest only and should not be relied upon as providing specific legal advice. If you require any further information about the issues raised in this article please contact the author or call 0207 404 0606 and ask to speak to your usual Goodman Derrick contact.