REWARD
Tackling modern slavery
Danny Done, managing director of Portfolio Payroll, explains why modern slavery is an issue that organisations of all sizes should be aware of and take action on
W hile legal obligations relating to modern slavery statements only apply to large organisations, modern slavery itself is something that businesses of any size can, and should be, acting on. Here, we look at what the legal obligations on modern slavery are and what all employers can do to tackle it. What is modern slavery? In 2015, the Modern Slavery Act became law. This set out the definition of modern slavery as a term that includes any form of human trafficking, slavery, servitude or forced labour. Under this Act, an organisation must publish an annual modern slavery statement if it is: ● a “body corporate” or a partnership ● carries on a business, or part of a business, in the UK ● supplies goods or services ● has an annual turnover of £36 million or more. This first applied to all eligible businesses with financial years ending on or after 31 March 2016 and to all financial years since. The statement must be published within six months of the end of the financial year. The statement The annual statement should include information about the organisation’s: ● structure ● business ● supply chains ● policies ● due diligence processes ● assessment and management of the risk of slavery and trafficking. It must also specify the steps it has taken during the preceding financial year to ensure modern slavery is not taking place in its business or supply chain. Additionally, it must evidence its effectiveness in preventing modern slavery in these steps, measured against appropriate performance indicators and what training is available to
staff on these measures. If the above steps are not taken, the statement must state this and it is recommended to explain why. It’s not just a statement, however. It is designed to ensure employers are transparent about how they are taking modern slavery seriously and the effective steps they are taking to identify and remove modern slavery – not only within their own business but throughout their supply chain, which could impact smaller businesses too. Benefits to businesses that report on their modern slavery efforts include: ● protecting and enhancing the reputation and brand ● protecting and growing the customer base as consumers seek out businesses with higher ethical standards ● improved investor confidence ● greater staff retention and loyalty based on values and respect ● developing more responsive, stable and innovative supply chains. Application to small and medium- sized businesses Businesses that fall below the mandatory threshold may still choose to publish a statement and many do as part of their overall environmental, social and governance strategy and corporate responsibility. It’s a way to demonstrate the organisation’s commitment to upholding human rights. Statements are also beneficial where the business is involved in bidding for contracts against larger businesses that do have a statement, or where the organisation the business wants to deal with is putting in measures to ensure other parties it is working with are committed to preventing slavery. Alternatively, it could be because the business is already part of a supply chain for a larger organisation that meets the threshold for mandatory statement publication and voluntary statement publication is one of the
ways the larger organisation meets its own statutory obligation.
Actions to prevent modern slavery Employers need to act diligently to prevent modern slavery. This could be by only using reputable organisations to source staff and paying employees a fair wage for safe and legal working hours. They should also ensure that the businesses they work with are doing the same, either through requiring them to voluntarily publish a modern slavery statement and take action on it, or by inspiring them to do so by publicising their own. Undertaking thorough due diligence during procurement and within the existing supply chain is integral to tackling on modern slavery. To do this, employers can proactively identify the areas where workers associated with their organisation could be at greater risk of modern slavery. This includes the type of work carried out and where the organisation is based. Identifying higher risk areas can inform decisions on where to focus monitoring efforts and where deeper insight might be needed. This could be gained by going beyond normal procurement practices and taking additional steps if the area the organisation is based has a higher risk of exploitation. Making the organisation’s position on modern slavery known to those it is working with can also discourage those that are involved in modern slavery from seeking to work with it, especially where it indicates a higher risk of getting caught out. Modern slavery continues to be a global issue and all employers in the UK can play a part in eradicating it, even if they fall below the Modern Slavery Act threshold. Taking steps to ensure as an organisation that it is not involved in modern slavery, even unknowingly, and placing the same expectations on businesses it works with is one of the ways this can be achieved. n
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| Professional in Payroll, Pensions and Reward |
Issue 106 | December 2024 - January 2025
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