Modern Slavery Act: A practical plan for purchasers

Shaun McCarthy
13 October 2015

Suddenly everybody is talking about modern slavery. This is because the UK government has passed some new legislation that nobody really understands.

This has resulted in the usual small flurry of companies running round like headless chickens, most companies being unaware of the changes, academics frantically applying for research funding to work out the answer in four years time and consultants scenting blood and circling said headless chickens in the hope they may be able to sell them an instant solution to their problems.

I find it is usually best to ask a lawyer about new legislation. I am grateful to my friend and long standing colleague Carol Hill for her guidance in putting this blog together. So what does it mean?

The legislation simply requires transparency and leaves the court of public opinion to do the rest. It makes it an offence to hold a person in slavery or servitude or to require a person to perform forced or compulsory labour.

It requires businesses with a global group turnover of £36 million a year or more to prepare a slavery and human trafficking statement per financial year. Failure to do so can result in unlimited fines. The purpose is to set out what an organisation has done to prevent modern slavery in their own business and supply chain.

It is an option to put up a statement to say “I am doing nothing to prevent modern slavery in my business or supply chain” but what would your customers, investors, employees think if you said that? I would not advise you do this.

The statement must include:

• Details about the company’s structure, business operations and supply chains (including sectors and countries)
• Policies in relation to slavery and treatment of workers and human rights due diligence processes
• Parts of the business and supply chains where there is a risk of slavery and human trafficking taking place including risk assessments and management procedures to mange those risks
• KPI for effectiveness of the company's commitments and training
• Information about the company’s values, remediation and grievance procedures for workers that are victims or at risk of modern slavery
• Capacity building of staff to manage and mitigate risks of modern slavery, forced labour or human trafficking

But what does it mean to procurement professionals? Here is my advice, for what it is worth:

• Firstly don't panic
• Get some proper advice from your legal department or a decent lawyer
• Don’t rush into the arms of providers who sell you blanket audits or online platforms that add cost to you and your suppliers. You may need them but think about it first. In most cases you probably won’t
• Prioritise your supply chain. You are looking for products and services with a high content of low skilled or semi-skilled workers
• Don’t assume this is a developing world problem. We all know that workers are illegally trafficked to all parts of the world. You can’t assume that you are free from the problem in the so-called developed world
• Make a plan. This needs to include a policy statement, training for your staff, changes to your procurement processes and contract documents and measuring performance and engagement with your supply chain

Shaun McCarthy is director of Action Sustainability

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