What duties do employers have under the "transparency in supply chains" provisions of the Modern Slavery Act 2015?

Section 54 of the Modern Slavery Act 2015 requires commercial organisations to prepare a slavery and human trafficking statement for each financial year. This is a statement that either:

  • sets out the steps that the organisation has taken during the financial year to ensure that slavery and human trafficking is not taking place in any of its supply chains, and in any part of its own business; or
  • states that the organisation has taken no such steps.

While an organisation does not have to show that it has taken steps to prevent slavery or human trafficking in its business or supply chain, making a statement that it has taken no such steps may have damaging consequences for its reputation and commercial success.

Section 54 states that the organisation's statement may include information on:

  • its structure, business and supply chains;
  • its policies in relation to slavery and human trafficking;
  • its due diligence processes in relation to slavery and human trafficking in its business and supply chains;
  • the parts of its business and supply chains where there is a risk of slavery and human trafficking taking place, and the steps that it has taken to assess and manage that risk;
  • its effectiveness in ensuring that slavery and human trafficking is not taking place in its business or supply chains, measured against such performance indicators as it considers appropriate; and
  • the training about slavery and human trafficking available to its staff.

The Government has published Transparency in supply chains etc: A practical guide, which gives advice on what employers can include in a statement.

The duty applies to commercial organisations with a total turnover of at least £36 million per year. "Commercial organisations" that are covered by the duty are body corporates and partnerships that carry on a business, or part of a business, in the UK, supplying goods and services.

The slavery and human trafficking statement must be approved at the highest level of an organisation, for example approved by the board of directors and signed by a director, or approved by the members and signed by a designated member if the organisation is a limited liability partnership.

The organisation must publish the slavery and human trafficking statement on its website and include a link to the statement in a prominent place on the homepage. If it does not have a website, it must provide a copy of the slavery and human trafficking statement within 30 days of any written request for one.

Section 54 of the Modern Slavery Act 2015 is in force from 29 October 2015 and applies to financial years ending on or after 31 March 2016.