By Tomas Varga from Faegre Baker Daniels LLP
The Modern Slavery Act 2015 attempts to eradicate the problem of human trafficking and slavery by requiring businesses to be transparent about the actions they have taken to ensure that their business and supply chains do not allow slavery and human trafficking to take place.
Although not yet in force, complying with this legislation will soon require any business with a turnover of £36 million which carries on any part of its business activities in the UK (regardless of where it was incorporated) and which supplies goods or services, to prepare a slavery and human trafficking statement for each financial year. The statement must describe the steps the organisation has taken to ensure that slavery and human trafficking are not taking place in any of its supply chains and in any part of its own business.
In order to be ready to comply with the new legislation, businesses likely to be affected need to start considering now how best to prepare. Such preparations should include:
- Carrying out a summary assessment of the business’s ability to gather relevant information across its operations which may involve companies and individuals in different countries. Although some businesses may already evaluate and report on slavery issues through voluntary disclosures, and therefore have relevant reporting and auditing mechanisms in place, many do not and will have to consider for the first time how best to implement such mechanisms.
- For those businesses that have a large number of suppliers, carrying out a risk assessment to flag those supply chains that are most at risk of slavery and human trafficking so that efforts can be focused especially on those areas. Relevant individuals in the supply chains identified should be provided with adequate training and support. Early thoughts should also be given to how and by whom this training will be structured and delivered.