Slavery and human trafficking in the UK — overview

LexisNexis Legal & Professional, LexisNexis UK, LexisPSL, Risk and Compliance, 8 June 2017

In the UK, the Modern Slavery Act 2015 (MSA 2015) received Royal Assent on 26 March 2015. Section 54 requires some organisations to produce and publish an annual slavery and human trafficking statement.

References: Modern Slavery Act 2015, s 54

What is slavery?

MSA 2015 covers four activities which are defined by reference to article 4 of the European Convention on Human Rights:

Slavery

Exercising powers of ownership over a person

Servitude

An obligation to provide services is imposed by the use of coercion

Forced or compulsory labour

Work or services are exacted from a person under the menace of any penalty and for which the person has not offered themselves voluntarily

Human trafficking

Arranging or facilitating the travel of another person with a view to their exploitation

All four activities should be covered in a slavery and human trafficking statement.

Managing modern slavery risk

MSA 2015 has pushed modern slavery issues up the corporate agenda. Even if you conclude your supply chain does not pose a risk, your customers may still require assurances from you about your policies and procedures to ensure modern slavery does not take place.

This subtopic:

• contains guidance on conducting assessments of the risk of your organisation, or any of your supply chain, being involved in modern slavery

describes what a good modern slavery and human trafficking supplier audit process looks like and provides guidance on who should conduct audits, how to prepare for and carry out an audit, and how audits should be followed up

• contains a Checklist to help you consider what policies, practices and procedures you might implement to combat slavery and human trafficking which will then feed into your slavery and human trafficking statement, and

• contains various precedents, including:

anti-slavery policy

supplier questionnaire

recruitment agent approved list

contract clauses, and

• training resources

Who is required to publish a slavery and human trafficking statement?

The requirement to publish a statement applies to organisations meeting all of the following criteria:

References: MSA 2015, s 54

• commercial organisation—the definition appears to catch companies, limited liability partnerships (LLPs) and standard partnerships, but not sole traders

• supplying goods or services

• carrying on business in the UK

• with a total turnover of £36m or more

There is no need for an organisation to be registered in the UK to be caught by the disclosure obligation. For multinational organisations, however, a parent may not necessarily need to report merely because a subsidiary meets the criteria. The key will be whether a non-UK parent has a demonstrable UK business presence. Practice Note: The Modern Slavery Act 2015 and multinational organisations sets out some illustrative examples of how this might work in practice.

Even if your business does not meet the £36m turnover threshold, you may wish to publish a statement in any event, eg because:

• the government encourages all businesses to develop an appropriate and effective response to modern slavery

References: Home Office: Transparency in Supply Chains etc: A practical guide, para 2.5

• it could be a requirement of competitive tendering

• it can address issues of corporate social responsibility

• as an employer you have a responsibility to ensure your employees and colleagues are safeguarded

• it's a good way to demonstrate that you are protecting your workers

• it can help protect and enhance your reputation and brand

• it could help protect and grow your customer/client base, as more customers/clients seek out businesses with higher ethical standards

• it can improve investor confidence

• it can result in greater staff retention and loyalty based on values and respect, and

• it can help develop more responsive, stable and innovative supply chains

Format of the statement

The government has not been prescriptive about the layout of the statement, so it's up to you how you present yours, though you should remember it's a public-facing document.

References: Home Office: Transparency in Supply Chains etc: A practical guide, paras 4.1–4.4

It should:

• be written in simple language that is easily understood

• be succinct, but cover all the relevant points

• provide appropriate links to relevant publications, documents or policies (eg to your Corporate Social Responsibility policy)

• be in English, but also available in other languages relevant to your business and supply chains

Contents of the statement

Again, the government has not been prescriptive here.

The information presented in your statement is likely to be determined by the complexity of your structure and supply chains and the particular sectors and jurisdictions in which your suppliers are involved.

The statement must set out:

References: MSA 2015, s 54

• the steps you have taken during the financial year to ensure slavery and human trafficking are not taking place in any part of your supply chains or your own business, or

• that you have taken no such steps

It's up to how much detail you provide, but you must include in the statement all the steps you've taken. This doesn't mean you must guarantee your entire supply chain is slavery free: it means you should capture all the actions you've taken to this end.

References: Home Office: Transparency in Supply Chains etc: A practical guide, para 2.3

You will be able to comply with MSA 2015 by simply publishing a statement that you have taken no steps to ensure slavery and human trafficking is not taking place. Such an approach is unlikely to be perceived as best practice and may place you at a disadvantage on some tenders.

MSA 2015 provides provide a non-exhaustive list of information you could include:

• a brief description of your business model and supply chain relationships

• your policies relating to modern slavery and human-trafficking

• your due diligence and auditing processes

• the principal risks related to slavery and human trafficking, including how you evaluate and manage the risks in your organisation and your supply chain

• relevant key performance indicators, ie measures that will assist the reader of a slavery and human trafficking statement to assess the effectiveness of the activities described in the statement

• training available and provided to those in supply chain management and the rest of the organisation

You don't have to include all these areas (unless they in fact reflect the actual steps you've taken); they're examples only.

Precedent: Anti-slavery and human trafficking statement provides a starting point for preparing your statement.

The table at Slavery and human trafficking statement—Contents of the statement contains suggested details/information you may wish to include in your statement.

References: Home Office: Transparency in Supply Chains etc: A practical guide, Annex E

Approval and signature of the statement

MSA 2015 requires that the statement is approved and signed by an appropriate senior person in the business. This ensures senior-level accountability, leadership and responsibility for modern slavery, and gives it the serious attention it deserves.

References: Home Office: Transparency in Supply Chains etc: A practical guide, para 7.3

The person required to sign the statement depends on the type of organisation:

company

approved by the board of directors (or equivalent management body) and signed by a director (or equivalent)

limited liability partnership

approved by the members and signed by a designated member

traditional partnership

signed by a partner

Publishing the statement

Assuming you have a website, you must:

References: MSA 2015, s 54

• publish the slavery and human trafficking statement on that website, and

• include a link to the slavery and human trafficking statement in a prominent place on the website homepage

In the highly unlikely scenario that you meet the qualifying criteria of the Act but you do not have a website, you must provide a copy of the slavery and human trafficking statement to anyone who makes a written request for one within 30 days of receiving the request.

Where you have more than one website the government recommends placing the statement on the most appropriate website relating to your business in the UK. Where there is more than one relevant website, you should place a copy or a link on each relevant website.

References: Home Office: Transparency in Supply Chains etc: A practical guide, para 8.2

A prominent place may mean a modern slavery link that is directly visible on the home page or part of an obvious drop-down menu on that page. The link should be clearly marked so that the contents are apparent. The government recommends a link title such as ‘Modern Slavery Act Transparency Statement’.

References: Home Office: Transparency in Supply Chains etc: A practical guide, para 8.3

Timing and frequency of the statement

To ensure the information contained is relevant and up to date, the government expects statements to be published as soon as reasonably practicable after the end of each financial year. It encourages organisations to report within six months of financial year end.

References: Home Office: Transparency in Supply Chains etc: A practical guide, para 6.4

The statement must be prepared and published each financial year.

References: MSA 2015, s 54