It is estimated that 21 million people worldwide are victims of modern slavery or enforced labour. The majority are exploited in manufacturing, construction and agriculture, with illegal profits estimated at 150 billion US dollars per annum.
If your corporate year end is on or after 31 March 2016, read on.
The Modern Slavery Act 2015 obligations relating to annual slavery and human trafficking statements are now in force. Commercial organisations with a total annual turnover of £36 million or more, carrying on a business in the UK, and whose financial year end is on or after 31 March 2016, will be the first businesses required to produce an annual slavery and human trafficking statement for their financial year.
That statement needs to be approved by the board of directors, signed by a director and must be displayed in a prominent place on the organisation's website.
The statement requires to set out the steps the organisation has taken in the financial year to ensure that slavery and human trafficking is not taking place in any of its supply chains or its own business. It can include information about:
- the organisation's structure, business and supply chains
- its policies in relation to slavery and human trafficking
- its due diligence processes in relation to its business and supply chains
- the parts of the business and supply chains where there is a risk of slavery and human trafficking taking place and the steps it has taken to assess and manage that risk
- its effectiveness in ensuring that slavery and human trafficking is not taking place, measured against performance indicators
- the training on slavery and human trafficking available to its staff
If an organisation fails to produce the statement, civil court action can be taken to enforce compliance and unlimited fines can be issued. Government guidance states that organisations should publish their statement as soon as reasonably practicable after the end of the financial year, and ideally with six months of it.
Organisations below the £36 million threshold should be aware that they may be required to assist those preparing these statements where they are part of the larger organisation's supply chain.
Disclaimer
The material contained in this article is of the nature of general comment only and does not give advice on any particular matter. Recipients should not act on the basis of the information in this e-update without taking appropriate professional advice upon their own particular circumstances.
