In updated guidance (46 page / 1.73MB PDF) published this month the Home Office set out to encourage companies to comply with the requirement in the Modern Slavery Act 2015 to produce a statement setting out their efforts to make sure they are compliant with the 'Transparency in Supply Chains' provision of the legislation.
While not changing the law, the new guidance introduces a definition of child labour and encourages organisations with turnover of less than £36 million to produce a statement. The government has also amended the language in the guidance to encourage compliance; for example, instead of saying statements “may” include certain information the guidance now suggests organisations “should aim to include” that information.
It has also removed the passage that stressed that certain categories of information were "not compulsory", instead suggesting these are types of information to include.
Regulatory expert Tom Stocker of Pinsent Masons, the law firm behind Out-Law.com, said the issuance of amended guidance was an important move by the government.
“This is significant because the government is telling companies that they should conduct modern slavery risk assessments, carry out due diligence on suppliers, produce policies and procedures, deliver awareness training, and monitor compliance,” Stocker said.
“That sends a clear signal that eliminating modern slavery and promoting good corporate practice in this area is a Home Office priority. It is unusual for guidance such as this to be updated and re-issued,” Stocker said.
Currently all organisations with a turnover of £36m or more which are incorporated in the UK or do business in the UK are required to produce a statement. Last month analysis by the Chartered Institute of Procurement & Supply (CIPS) found that 37% of supply chain managers subject to the act’s remit admitted to not even having read the government guidance and 34% of organisations required to produce a statement had not done so.
“Such a finding will be of concern to the Home Office. As matters currently stand, the penalties for non-compliance with the requirement to publish a modern slavery transparency statement are civil in nature,” said Stocker.
“The Home Office may adopt a tougher line if more businesses do not meet the minimum statutory requirements and then move towards good practice as the Home Office’s guidance recommends,” Stocker said.
The government includes offences such as slavery, forced or compulsory labour, human trafficking, and some forms of child labour, in its definition of modern slavery.
The CIPS survey revealed that a minority (45%) of businesses had mapped their suppliers to understand the risks of exposure to modern slavery, while just 40% had ensured all workers in the UK were receiving the minimum wage and had been subject to immigration checks.
The CIPS said only 6% of managers were “absolutely certain” there was no modern slavery in their supply chains. However more than half of the respondents to the survey said they felt there should be legal consequences such as fines for those who fail to comply with legislation, and more than two-thirds wanted it to be extended to businesses with turnover of less than £36m.
In August the National Crime Agency said the extent to which modern slavery and human trafficking were taking place in the UK was far wider than originally thought.