Business Law & Compliance

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What does introduction of section 54 of the Modern Slavery Act mean for your business?

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For many, the idea of modern slavery happening will seem completely implausible – can slavery in business really be a problem in the UK in 2016? Unfortunately, it is. Estimates of adults and children trapped globally in various forms of modern slavery varies from a conservative figure of 21m to an upper figure of 36m.

Despite the rise of public awareness – even Coronation Street has been running a storyline on it – modern slavery can be difficult to detect. There is no accepted definition of modern slavery but it includes: slavery – the assertion of ownership over a person; servitude – an obligation to provide services by coercion; forced and compulsory labour – being made to work under the threat of penalty; and human trafficking – arranging or facilitating the travel of another person with a view to being exploited. So it may not be as obvious as we would think.

Read more about the Modern Slavery Act:

Section 54 of the Modern Slavery Act aims to bring transparency to the supply chain and demands each boss takes responsibility for not only operations, but also the operations of companies who they choose to conduct business with. At first glance, it may appear that little is required to comply with the Act. Indeed, for some organisations, a minimalist approach may be justifiable. However, for most organisations there are clear requirements.

If a business has a turnover of £36m globally and carry out any operations in the UK, it will be required to publish an annual statement. However, as the requirements of publishing a statement require consideration of the whole supply chain, much smaller companies are likely to be brought into scope of the Act, with bosses likely to be required by the businesses they supply to consider their processes for ensuring that modern slavery is not taking place within their business.

The Act states that relevant businesses must publish an annual statement within a reasonable period after the financial year end on their website. The statement must be available to view by the public via a link from the site’s homepage. If the company does not have a website, the statement must exist as a document that can be sent, upon request, to anyone who asks within 30 days.

The statement doesn’t have to guarantee that there is no modern slavery in the supply chain but must detail the steps the organisation has taken to ensure that modern slavery is not taking place in any of its supply chain or its businesses – or, as may be the case, state that it has not taken any steps. There is no penalty for not publishing a statement but the government can apply to court for an undertaking requiring your compliance. It is expected that unions and the media will ensure compliance and drive a change in attitude.

Read on for a checklist of how to not fall foul of the law.

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