All businesses that have a turnover of £36m or more will have to report on what steps they have taken to eliminate modern slavery from their supply chains and their own business. So the Government says in its response to a consultation on the Modern Slavery Act, which will now come in from October. However the Government has not said when it will print guidance on how a business can show it doesn’t contain modern slavery.
A consultation on the Act ran from February to May, as featured in our April issue. The Home Office says that it decided to set the turnover threshold at £36m per year as that’sthe officially defined size of a large company. The Modern Slavery Act covers organisations carrying out any part of their business in the UK so there is no requirement for a business to meet a certain level of ‘footprint’ in the UK. While it may apply most to retailers with long and global supply chains – Asda, John Lewis and Tesco were among firms that replied to the consultation – the Home Office stresses that the law will cover all sectors, and goods and services. A similar law in California covers only goods.
The two questions the Government was consulting about were: what threshold to set? and what guidance should the Government give so that businesses do proper governance of their supply chains to meet the Act? The Government said that it wants to balance the benefits of transparency with avoiding placing undue burdens on business.
It’s likely then that a firm that falls within the Act will have to give a brief description of its business model and supply chain relationships; its policies relating to modern slavery, including due diligence and auditing processes; the training available and provided to supply chain managers and the rest of the organisation; the principal risks related to slavery and human trafficking including how the organisation evaluates and manages those risks in their organisation and their supply chain; and key performance indicators.
As the Home Office put it, it wants ‘businesses to take the issue of modern slavery seriously at the highest levels and for businesses to be able to determine, demonstrate and explain their policies and practices relevant and specific to their own circumstances’.
For the Government response to the consultation in full visit – https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/448200/Consultation_Government_Response__final__2_pdf.pdf.
