Modern Slavery – How Secure is your Supply Chain?

At a recent client meeting, I was asked about the impact of the Modern Slavery Act 2015 (“the Act”) and what disclosure requirements the company would need to adhere to. I must confess that I wasn’t aware that there was such an Act, let alone what disclosures would be needed!

Following some research into The Act, which came into force for years ending 31 March 2016 and onwards, it is essentially a combination of previous laws, with some new areas covered as well, and is aimed at further protecting the rights of individuals who work for businesses in the UK, or as part of their supply chains.

The Act requires companies to publish a “slavery and human trafficking statement” on their website for each financial year which details:

  • The steps the organisation has taken during the financial year to ensure that slavery through human trafficking is not taking place in any of its supply chains, and in any part of its own business; or
  • That no such steps have been taken.

At first glance, it would appear that the Act only applies to larger companies, being those with a Turnover of £36m and above, and therefore will not affect a large number of businesses in the UK; however, the Act covers not only the operations of the business, but also its supply chain.

A large number of companies may therefore be indirectly affected by the Act and although they won’t have to publish a statement on their own website, may be asked by their larger customers to provide details on their policies, as part of a larger supply chain.

The government has not issued a definitive list of what the statement should include, however the Act does recommend that the following areas are covered:

  • The organisation structure, its business and its supply chains;
  • Its policies in relation to slavery and human trafficking;
  • 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 that it has taken to access and manage that risk;
  • Its effectiveness in ensuring that slavery and human trafficking has not taken place in its business or supply chains, measuring such performance indicators as it considers appropriate;
  • The training and capacity building about slavery and human trafficking available to its staff.

It is therefore important for all companies in the UK to consider this legislation, even if they do not have to directly comply with it.

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