Under the Modern Slavery Act 2015 UK firms must take responsibility

Charlotte Hopkinson

The Modern Slavery Act 2015 requires large companies operating in the UK to publish an annual statement disclosing what steps they have taken (if any) to prevent slavery and human trafficking in their business and supply chain. With scrutiny from shareholders and other stakeholders likely to mean reputational risks for companies not taking action, its impact on the sector should not be underestimated.

Construction has received its fair share of scrutiny, with human rights violations being well-publicised, for example on Qatari construction sites and in brick kilns in India. But slavery does not only affect those companies sourcing from abroad. The most recent edition of the Global Slavery Index ranked the UK as 124th out of 167 countries, and Home Office research suggests that in 2013 there were 10-30 thousand victims in the UK. Data from the National Crime Agency’s Strategic Assessment 2013 suggests labour exploitation is most common in the block paving, agriculture, food and construction sectors, and 53 instances of potential trafficking in the construction sector were reported to authorities in that year.

So what are the risks in the supply chain? Forced labour covers bonded labour (where workers pay a recruitment fee or use labour to pay off debts), or those who are beholden in any way to a labour agency or employer. Often contractors are not even aware that their sub-contractors or labour agencies are using forced labour practices, such as withholding payments, or requiring labourers to work unpaid until a project is complete, and others turn a blind eye to forged documentation. The UK Government has produced a checklist for the construction sector which sets out what to look for if companies are concerned about potential abuses in its supply chain, but what are the preventative steps companies should be taking to eliminate this risk?

Firstly, get to grips with the supply chain and understand where the labour is coming from. Mapping a company’s operations will help identify where the material risks are and who to collaborate with to prevent forced labour. Develop human rights and supply chain policies, to communicate the company’s commitments to ensure a slavery free supply chain, and embed these into procurement processes. A policy should be supported by due diligence to monitor compliance, and set out what to do in the event that instances of slavery are uncovered.

There are leading examples that the sector can learn from, such as British Land’s Supply Chain Charter and Crossrail’s contractor performance management framework. However the sector has historically experienced challenges with poor supply chain visibility and an absence of whistleblowing mechanisms to report risks at site level. Critically, it will be important for companies to collaborate with their suppliers to minimise risks, but also to collaborate with each other. The overlapping nature of construction supply chains provides opportunities for companies to create joint approaches which will tackle modern slavery at a sector-wide level. The challenge of eliminating modern slavery from the industry is one we all need to take on.

Charlotte Hopkinson is a senior consultant for Upstream Sustainability Services at JLL