Implications of the Modern Slavery Act for Companies Operating in the U.K.

The U.K. Modern Slavery Act became law on March 26th, 2015. This new law has the potential to set a new European precedent in the eradication of slavery, and could have far-reaching implications for how businesses operating in the U.K. must evaluate and manage what is happening in their supply chains.

 In response to growing public concern, the U.K. enacted the Modern Slavery Act in March  2015, which contains a dedicated section on Transparency  in  Supply  Chains   for  ‘commercial   organizations’  (Part  6  Clause  54) requiring them to report on their due diligence efforts to prevent slavery and trafficking. Background Voluntary initiatives have been influential in provoking stakeholder dialogue and increasing supply chain transparency. The Modern Slavery Act requires companies to explain, and publish, efforts to:

• Identify  and  analyze  and  risks  of  human  trafficking  and  slavery  in  the  supply  chain.
• Create  and  Maintain  internal  accountability  standards  and  procedures  for  employees  and   contractors  and  taking  action  on  those  who  fail  to  meet  company  standards  regarding   slavery  and  trafficking.
• Conduct  audits  of  suppliers  to  evaluate  supplier  compliance  with  company  standards  for   human  trafficking  and  slavery  in  supply  chains.
• Require  direct  suppliers  to  certify  that  materials  incorporated  into  the  product  comply  with   the  laws  regarding  slavery  and  human  trafficking  of  the  country  or  countries  in  which  they   are  doing  business.
• Provide  company  employees  and  managers,  with  direct  responsibility  for  supply  chain   management,   training   on  human  trafficking  and  slavery,  particularly  with  respect  to   mitigating  risks  within  the  supply  chains  of  products.