Hundreds of slaves on building sites due to poor supply chain visibility

10 May 2022

Over 30 construction companies “unwittingly” paid a criminal gang that was enabling slave labour in the UK due to a “problematic lack of visibility” in supply chains. 

Between 300 and 500 Romanian workers were victims of slave labour on commercial, residential, and demolition projects from 2009-18 across London and the southeast after being exploited by a criminal gang, according to a report by Dame Sara Thornton, the independent anti-slavery commissioner. 

Payments to the gang ranged from £100s to £100,000s from “at least” 33 companies. However, investigators believe the identified businesses are only a “fraction” of the total.

Dame Sara said: “There is a problematic lack of visibility of how temporary workers are being treated in the lower tiers of supply chains. 

“The ongoing skills shortage, which has historically been offset by migrant workers, has been exacerbated by the pandemic and changing immigration rules. The sector’s labyrinthine network of subcontractors obscures visibility of lower levels of supply chains. Financial penalties for delays, shortages of labour and materials, and the rapid churn of the workers, place numerous pressures on contractors on a daily basis. 

“The difficulties experienced in providing effective support to workers, and battling noncompliance in supply chains, underlines the pressing need for government to provide more guidance and leadership across the spectrum of issues.”

The report cited data from Achilles which found 26% of companies do not request or verify appropriate right-to-work documentation for construction workers and 21% of workers were found to be using non-standard documentation to access sites.

One in 20 (5%) workers were not required to present any identification or right-to-work documents at all.

The report found 31% of companies were unable to prove they had checked for payments made to workers through agencies or umbrella companies. 

A quarter (27%) of companies did not verify workers employed by subcontractors, agencies or umbrella companies were paid in line with minimum wages, and 20% were found to be applying non-standard charges to workers resulting in a loss of 25% of weekly wages through commission, agency, payroll or administration fees.

The report said visibility over the lower tiers of supply chains is “often poor or non-existent”.

Caroline Gumble, CEO of Chartered Institute Of Building, said: “There is absolutely no room for complacency when it comes to measures to avoid modern slavery in construction. Modern slavery has been an issue in our industry for too long. 

“Given the skills shortage and the current trading environment and pressures on the industry, it is right that this remains a priority. Modern slavery should have no place in our industry or in our society.” 

Duncan Brock, group director of CIPS, said the report shows modern slavery has a "vice-like grip" over supply chains, "blighting the UK’s economy and many businesses."

 
In a competitive environment construction firms work with small margins so may be more susceptible to slave gangs in the supply chain, without proper checks and balances in place. Supply chain managers in the sector have a huge role to play in raising awareness of those checks whether through close relationships with suppliers, adding modern slavery compliance clauses in contracts or supporting and educating suppliers on how to spot the signs.
 
As the report shows however, criminality will always exist. Underhand behaviour is often one step ahead of best practice and businesses must arm themselves with the best insight and guidance possible to ensure it doesn’t happen to them.
 
With the strengthening of the Modern Slavery Act, there is a clear commitment from government that these criminal gangs must not take hold. Qualifying businesses will now be given fines for not filing their modern slavery statements which will help construction and other companies focus on what matters most in our society.

Brock said: "In a competitive environment construction firms work with small margins so may be more susceptible to slave gangs in the supply chain, without proper checks and balances in place."

He said supply chain managers in the sector have a "huge" role to play in erradicating slavery, through raising awareness of checks, building close relationships with suppliers, adding modern slavery compliance clauses into contracts or supporting and educating suppliers on how to spot the signs.
 
He continued: "As the report shows however, criminality will always exist. Underhand behaviour is often one step ahead of best practice and businesses must arm themselves with the best insight and guidance possible to ensure it doesn’t happen to them.
 
"With the strengthening of the Modern Slavery Act, there is a clear commitment from government that these criminal gangs must not take hold. Qualifying businesses will now be given fines for not filing their modern slavery statements which will help construction and other companies focus on what matters most in our society."

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