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What is the Modern Slavery Act?
Written on 6 February 2024
The Modern Slavery Act 2015 requires certain large organisations to produce a ‘slavery and human trafficking statement’ on an annual basis. Qualifying organisations whose financial year runs from April to March, who haven’t yet published their statements, have until 31 March 2024 to do so.
With the deadline looming, here’s a timely reminder of the relevant provisions within the Act, as well as some potential developments for 2024 and beyond.
First, what is modern slavery?
Modern slavery refers to the contemporary forms of exploitation and abuse that involve individuals being subjected to forced labour, human trafficking, debt bondage, and other forms of coercion. It is characterised by the denial of basic human rights, freedom, and dignity.
For employers, addressing modern slavery is crucial as they play a pivotal role in preventing and combating these abuses. Employers are connected to complex global supply chains, and ensuring ethical labour practices is not only a legal obligation under laws like the Modern Slavery Act but also essential for maintaining a responsible and sustainable business.
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What is the Modern Slavery Act?
The Modern Slavery Act was introduced to consolidate existing laws concerning human trafficking and slavery. This essentially creates three types of criminal offence, namely slavery and servitude, forced or compulsory labour, and human trafficking and committing an offence with intent to commit human trafficking (including aiding, abetting, counselling or procuring a human trafficking offence).
Additionally, the Act imposed a new requirement on larger commercial entities to prepare a slavery and human trafficking statement each year. This statement outlines the actions an organisation has taken to ensure that slavery and human trafficking are not taking place in their operations or supply chains.
Who is required under the Act to provide a statement?
The obligation to prepare a slavery and human trafficking statement only applies to organisations with a turnover of more than £36 million per annum.
Businesses which meet the threshold must either:
- Set out the steps which they have taken to ensure that slavery and human trafficking are not taking place within their supply chain or within their own organisation; or
- Make a statement that they have taken no such steps.
Organisations which meet the threshold, if not already doing so, should start giving serious consideration to how they intend to comply with their obligations as, from a reputational perspective, taking the approach of publicly stating that they have taken no steps to prevent slavery or human trafficking is likely to be highly damaging.
What should a slavery and human trafficking statement contain?
A slavery and human trafficking statement sets out the company’s commitment to preventing slavery and human trafficking in its business activities. The government has not prepared a prescribed form for the statement, but they have issued guidance. The guidance sets out some detail of what the statement should contain:
- Details in relation to the organisation’s structure, businesses and supply chains;
- Its policies in relation to slavery and human trafficking;
- Its due diligence process in relation to slavery and human trafficking in its business and supply chains;
- The parts of its business and supply chains where there is risk of slavery and human trafficking taking place and the steps 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; and
- The training about slavery and human trafficking available to staff.
The statement must be published on the organisation’s website, with a link to the statement in a prominent place on their homepage. There is also government guidance on publishing the statement.
A failure to publish a statement could result in the Secretary of State obtaining an injunction for one to be published – an organisation will be in contempt of court if they fail to comply with such an injunction. Alongside this, there are the risks to reputation referred to above.
The statement must be published on the organisation’s website, with a link to the statement in a prominent place on their homepage.
A failure to publish a statement could result in the Secretary of State obtaining an injunction for one to be published – an organisation will be in contempt of court if they fail to comply with such an injunction. Alongside this, there are the risks to reputation referred to above.
Should organisations not caught by the Act still provide a statement?
While organisations who do not meet the annual turnover threshold are not required by law to produce a statement, it may still be helpful to make a voluntary statement. This may be where, for example, they are responding to supply chain due diligence, or when tendering for business where other bidders have produced a statement.
What should organisations be doing now?
Organisations that fall under the Act should make sure they have taken the following steps, if they have not done so already:
- Undertaken a risk analysis exercise to identify potential risks of slavery or human trafficking within their supply chains. Organisations that have overseas suppliers will be at an increased risk, particularly those suppliers who are in the developing world, as will certain sectors such as food production and clothing retail.
- Undertaken audits of their supply chains and commercial documentation.
- Reviewed and amended their commercial documentation to include specific warranties and indemnities from suppliers confirming adherence to the Modern Slavery Act and associated legislation.
- Introduced auditing processes for suppliers moving forward.
- Reviewed internal HR systems to ensure that right to work documentation is in place in relation to all their employees.
- Audited labour providers (agencies) who provide agency workers to them.
- Reviewed policies and procedures relating to equal opportunities and dignity at work to ensure they make specific reference to obligations to prevent slavery and human trafficking.
- Considered specific training for managers in relation to identifying potential signs of slavery / human trafficking, dependent upon levels of risk identified. For example, employees working particularly long hours, not interacting with colleagues, not being in possession of documents such as their passport, and living in inadequate or overcrowded accommodation may all be ‘red flags’.
Looking ahead
In 2021, the government proposed a number of amendments to the obligation to produce a modern slavery statement. These included introducing fines for failures to comply with obligations to publish a statement and establishing a single enforcement body. However, these have not yet materialised at the time of writing.
In 2023, a Private Members Bill was introduced to the House of Lords which would require commercial organisations and public authorities to prevent human rights and environmental harms in their operations, and carry out due diligence assessments of their operations. Again, at the time of writing, this remains only a proposal.
Further guidance
The government has issued some practical guidance on the obligations imposed by the Act, in particular regarding what should be included in the slavery and human trafficking statement. It can be found here.
