The Modern Slavery Act 2015 Regulations came into force this week, requiring certain businesses to report annually on the steps they have taken to guard against slavery and human trafficking in their company or supply chain.
The requirement applies to companies with a turnover of £36m per year or more, which are incorporated in the UK or carry on a business here. They must publish a link to the report in a prominent place on their website.
Zee Hussain, employment partner at Simpson Millar, says: “Businesses likely to be affected need to start thinking about what they need to do to ensure they can make the required statement.
“They need to, first, take steps to investigate and to ensure slavery and human trafficking is not taking place; second, investigate and gain an understanding of how the business engages with suppliers and partner organisations to ensure the same; and third, investigate and identify any gaps in processes across the business, then design and implement measures to strengthen these. Businesses will also need to be prepared to engage with interested stakeholders following the publication of their statement.”
Claire Pardo, corporate associate at Withers, highlighted the key points for companies to consider:
- the reports are meant to be an evolving disclosure not a one-off exercise;
- organisations that primarily pursue charitable or educational aims are still required to produce the reports;
- the guidance to assist parent companies to determine which subsidiaries need to be taken into account in the report “is unclear and raises more questions than it answers”; and
- organisations should review their performance indicators and incentives to ensure they do not create risks, for example, on shipment "turn-around" time.
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