Modern slavery currently affects more than 50 million people worldwide and whether you’re a contractor, business owner or employee of a company, it is an issue that needs to be tackled head-on.
What is modern slavery?
Modern slavery involves various forms of exploitation, including forced labour, human trafficking and bonded labour, and is a global issue violating millions of people’s human rights. Modern slavery is a crime under the Modern Slavery Act 2015 and is widespread across diverse sectors, spanning agriculture, manufacturing, and the service industry. Particularly alarming is its prevalence within the construction sector, where a staggering 18% of individuals have been identified as victims of modern slavery (Construction Line).
What is the Modern Slavery Act 2015?
The Modern Slavery Act aims to combat this crime by requiring businesses with a turnover above £36 million to take action to prevent and address modern slavery within their operations and supply chains. These actions may involve conducting risk assessments, establishing rigorous due diligence protocols to identify and mitigate modern slavery risks, and scrutinising suppliers, contractors, and business partners to ensure strict adherence to ethical labour practices and human rights standards.
If your business meets the required Modern Slavery Act threshold, you must produce an annual slavery and human trafficking statement explaining the steps that you are taking to ensure your supply chain is non-complicit to modern slavery in your operations.
Although currently there is no financial or criminal offences for businesses that fail to comply, the government are within their rights to take businesses to the high court in order to request compliance. If a case were to be brought to the attention of the media, such bad press could of course negatively affect a business’s reputation and brand value.
Examples of modern slavery
Forced labour – forced work or services carried out by an individual against their will, and/or under a threat of harm or punishment. Victims may work for low wages or nothing at all and work is involuntary or forced due to threats. Generally speaking, working and/or living conditions are poor.
Trafficking – human traffickers coerce, threaten and use violence to recruit and force individuals into prostitution, forced labour, marriage, sexual gratification and other criminal offences
Bonded labour – the most common and widespread of modern slavery whereby money is borrowed, and people are then ‘forced to work’ to pay off debt, often their employment conditions and/or debt are then out of their control
Domestic servitude – victims are working for little or extremely low pay, poor conditions and and/or violent treatment (cleaning, cooking, childcare living with their ‘employer’)
Marriage – marriage can be forced against peoples will, with child marriages included.
Slavery of children – illegal work and exploitation of children for; marriage, work, soldiers, trafficking and domestic slavery
And how does modern slavery affect me?
Though you might perceive modern slavery risks as low for UK businesses and workforces, slavery risks persist in today's working world and pose significant threats to your business.
Let’s take the above example of ‘forced labour’ in relation to a UK based employer:
1.
You (the end client) currently engage with a contractor via their own limited company. They bring onto site their friend - a ‘recommended labourer’ with no documents or bank account details, but who has emailed to say he is happy to subcontract via his friend’s Limited Company and have his wages paid directly into his friend’s bank account.
Sounds kosher right? Well, what can often be the case is that the main contractor is actually keeping a % of the workers money, who is now being paid below national minimum wage.
Have you exercised enough due diligence to establish modern slavery is not taking place with this supplier (as well as NMW/RTW breaches)?
2.
You (the end client) require 5 new labourers to begin on a new site and a current contractor has found all 5 subcontractors ready to start on Monday. They have provided the contractor with all their documents, they are legal to work in the UK and as usual, you pay the money directly to the current contractor’s Limited Company. Again, this all sounds okay right?
Although the men are paid the full amount into their own UK personal bank accounts, behind closed doors, the 5 men are living in squalor conditions in 1 room with only 2 beds for all 5 of them. They have also had their passports confiscated until accommodation debts have been paid off.
Have you exercised enough due diligence to establish modern slavery is not taking place with this supplier?
With HMRC shifting their focus onto monitoring supply chains as they continue to find non-compliance, illegal working practices and fraud across multiple business sectors, your supply chain must be fully compliant in UK tax and employment law.
You can visit our blog based around supply chain due diligence for further information on demonstrating full compliance.
3 tips to prevent modern slavery in your supply chain
1. Conduct thorough supply chain due diligence: Scrutinise suppliers, subcontractors, and business partners to ensure compliance with labour practices and human rights standards.
How? A good starting point would be to conduct a risk assessment to identify any potential modern slavery risks within your supply chain.
HMRC’s check, act and review principles provide a great foundation for minimising risks in your supply chain.
2. Conduct regular audits and monitoring: Regularly audit and monitor your supply chain to ensure compliance with anti-slavery policies and procedures.
Important: ensure ongoing monitoring and assessment of suppliers and subcontractors to identify and address any instances of modern slavery or unethical labour practices.
3. Establish clear policies and procedures: Develop and implement policies and procedures that explicitly prohibit modern slavery and human trafficking within your organisation and supply chain. Ensure these policies are communicated effectively to all employees, suppliers, and stakeholders.
Top tip: Provide training to employees on the signs of modern slavery and ethical practices to help them understand the importance of supply chain due diligence.
How can we support you?
We offer free compliance health checks including a full audit of your labour supply chain to ensure that your business remains fully compliant.
We explore modern slavery and employment categorisation for your sub-contractors, worker claims, immigration, right to work, Kittel and VAT fraud - just to name a few!