LEGISLATION REMINDER: Modern Slavery & business obligations

23rd January 2025

Employment law, Newbury, Berkshire.

Under the Modern Slavery Act 2015, UK businesses have specific legal responsibilities to help combat modern slavery. This legislation applies primarily to businesses with a turnover of £36 million or more annually, who are also legally required to publish an annual statement detailing the steps taken to ensure that modern slavery and human trafficking are not in their operations or supply chains.

This statement, often referred to as a “Modern Slavery Statement”, must be approved at the highest levels of the organisation (such as the board of directors) and must be made publicly available on the business’s website. 

The Modern Slavery Act itself recommends that the following six areas are covered in any statement:

  1. Organisation structure and supply chains: Companies must outline their structure, business and supply chains, describing how they function and where potential vulnerabilities to modern slavery might exist.
  2. Policies in relation to slavery and human trafficking: The statement should highlight the policies in place to prevent and address modern slavery, such as supplier codes of conduct, ethical trading policies, and whistleblowing mechanisms.
  3. Due diligence processes: used to vet suppliers and job applicants.
  4. Risk assessment and management: Businesses need to assess where risks of modern slavery are highest, both in their direct operations and in their supply chains.
  5. Effectiveness:  Key performance indicators should be used to measure effectiveness of steps being taken. 
  6. Training on modern slavery and trafficking: Employers are expected to explain the training provided to staff on modern slavery.

The House of Lords Modern Slavery Act 2015 Committee recently published a report which proposed the introduction of financial penalties for non-compliance and a suggestion that the category of businesses obliged to produce a statement is extended. 

Currently the Secretary of State is able to enforce the duty to prepare a slavery and human trafficking statement in civil proceedings through an injunction and failure to comply is contempt of a court order and will be liable to an unlimited fine.

Aside from the statutory sanctions, a failure to produce and publish a statement could lead to a damage in reputation and brand. A good example of the reputational impact of modern slavery issues can be found in the recent case of a branch of McDonald’s in Cambridgeshire, which was found to have employed 16 victims of modern slavery. 

While the financial thresholds for the application of the legislation remain high, it is important for all businesses to be aware of this legislation and consider the risks. If you need help with this, please contact us on hello@fentonelliott.co.uk or 01635 896336.

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