UK Government threatens to ‘name and shame’ companies falling foul of Modern Slavery Act
07 January 2019
The Home Office has recently issued letters to approximately 17,000 companies who they have determined are obligated entities under the the UK Modern Slavery Act 2015 (the Act). Obligated entities are required to publish a modern slavery statement outlining the steps they have already taken and those they intend to take in the future regarding modern slavery and human trafficking in their businesses and supply chains (the Statement). While the requirements are by no means onerous many companies are failing to meet the minimum standards. In the letter, the Home Office outline a four step plan for companies to follow. These are to be addressed at the earliest opportunity and specifically state that the obligated entity should:
- nominate an employee of sufficient seniority to take the lead in either drafting the Statement or updating it from last year;
- register the Statement on the Government’s Modern Slavery Contact Database;
- ensure that the Statement meets at least the three minimum criteria (below) and also details the actions a company is taking to tackle risk in its business and supply chain; and
- publish the Statement before 31 March 2019.
Those companies who fail to follow the step plan will be “named and shamed” following the conclusion of the Home Office’s audit process. The audit is set to conclude on 31 March 2019 and as such we recommend that businesses engage with the four step plan sooner rather than later. Failure by an organisation to follow good practice and publish an accurate and robust Statement may attract unwanted and negative publicity that could impact brand value and share price.
As a reminder, the Act requires commercial organisations who; a) have an annual [global] turnover of £36 million+; b) carry out all or part of its business in the UK; and c) sell goods and / or services to publish a Statement every financial year. The Statement must meet three minimum requirements:
- publication on the company’s website with a prominent link on the homepage;
- approval from the board of directors; and
- signed by a director.
To support in the creation and publishing of the Statement, guidance has been provided which outlines six principle areas which should be covered to meet best practice standards. However, given that these are guidelines rather than enforceable requirements some companies have, to date, not followed the Home Office’s guidance, a decision which is likely to be a strong impetus behind the UK Government’s renewed efforts to encourage companies to improve and to refocus the agenda on people rather than profit.
How we can help
Our multidisciplinary team can help businesses to not only draft or improve their Statement but also support with the implementation of improves policies and processes, supply chain due diligence and risk profiling and staff training. All of which are included in the Home Office’s six principles of best practice.