When your client asks you about your business’ stance on modern slavery, what will you say? Do you know what it is? Do you know what you need to be doing about it? This month in our monthly legal update Flora Mewies of Ward Hadaway makes sure you are prepared when your clients ask.
What exactly is ‘Modern Slavery’?
Modern slavery is the illegal trade of humans for the purpose of slavery, servitude, forced/compulsory labour, commercial sexual exploitation or human trafficking.
How is this relevant to me?
All commercial organisations supplying goods or services which carry on a business or part of a business in the UK and which have a total turnover of £36 million per annum or more are required by law to produce a slavery and human trafficking statement each financial year.
Even if your business falls below the £36m threshold, you still need to read on. If you provide services to clients who meet this threshold, as part of their report, they need to demonstrate the steps taken to seek to identify and eradicate any slavery in their business and supply chain. If they have not already, they will be coming to you to ask for evidence of the checks and procedures that you have in place to recognise modern slavery and stamp it out. If you’ve never made any checks and have no procedures in place, this needs rectifying now.
Ground-breaking rulings on Modern Slavery
In the last few weeks there have been two landmark cases on modern slavery. Firstly, Cardiff Crown Court has jailed four men for varying periods between two and a half years and 14 years for modern slavery offences. This resulted from the four men keeping two victims prisoner in appalling living conditions at the farm where they worked. The victims received little or no pay for the jobs they carried out and were threatened with violence if they tried to escape.
In another case, the High Court found the British company DJ Houghton Chicken Catching Services liable to pay compensation to six Lithuanian men who were victims of human trafficking and modern slavery. The amount of compensation is not yet known but is likely to be in the hundreds of thousands of pounds. The victims were employed to catch chickens on farms across the UK and regularly worked on farms which produced eggs for the leading supplier to major supermarkets. As well as having their pay withheld, the Court heard that the workers were forced to live and work in inhuman and undignified conditions and were mistreated and beaten. This is the first time that a civil penalty has been imposed on a company for victims of trafficking and supports the emphasis being placed on combatting modern slavery.
What do I need to do?
If your business or group of companies needs to prepare a statement, following the end of your financial year (which may have just passed) you need to produce a statement that covers activity undertaken since 29 October 2015 (this is when the requirement to produce a statement was introduced).
If you don’t need to produce the statement but your clients do, you should still be taking the necessary steps to produce a statement to demonstrate your commitment to tackling modern slavery to clients.
In order to have something to put in your statement, the type of steps you should be taking are:
- appoint senior individual(s) to be responsible for compliance, investigating and managing the risk of modern slavery;
- carry out an audit of your business, relationships and supply chains to identify any exposure to slavery or human trafficking;
- where high-risk areas are identified, such as links with developing countries or those known to have poorer standards of labour protection, develop strategies to minimise your risk;
- update policies and practices e.g. whistleblowing and grievance policies and introduce a modern slavery policy; and
- train your board and staff to help them identify and report potential issues.
Ward Hadaway can help you with this process and has devised a modern slavery toolkit comprising of the document and policies needed by you to publish your statement and keep clients’ compliance teams happy.
