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Modern Slavery Rules Changing from 1 April 2023

Modern Slavery Rules Changing from 1 April 2023
29 March 2023
 

Updated guidance on identifying and managing the risk of modern slavery in supply chains will soon apply. Alex Minett from CHAS looks at what’s changed and discusses some steps all organisations can take to prevent modern slavery within their networks.

Alex Minett is the Head of Products and Markets at CHAS. He has extensive knowledge of construction best practices and compliance having worked on iconic projects such as the London 2012 Olympics and Paralympics and the Battersea Power Station where he advised on safety measures for the demolition and re-erection of the four iconic chimneys. Alex has also worked closely with the World Bank on one of the world’s largest solar farms in Benban and initiated a zero-harm approach to safety at the Facebook Data Centre in Lulea.

 

New Government Procurement Policy Can Act as Useful Guidance for All Industry Sectors

 

Modern slavery is on the increase. The International Labour Organization (ILO) reports the COVID-19 pandemic has fuelled a surge in extreme poverty which is considered a major factor in driving forced labour. Recent UK government statistics reflect this; November 2022 saw the highest number of potential modern slavery victims referred to the Home Office for investigation since their National Referral Mechanism (NRM) began in 2009 – a 38 per cent increase on the same quarter the previous year. 

More worrying is these figures are likely just the tip of the iceberg. In 2021, 12,727 potential modern slavery victim referrals were made to the NRM by “first responders” – the police, councils, border force, and selected charities authorised to refer. Yet, analysis from the Centre for Social Justice estimates there could be at least 100,000 victims in the UK, with the actual number expected to be even greater. 

While you could argue that increased victim referrals correlate with better awareness and identification of modern slavery, there’s no disputing the sad reality that the figures still represent large-scale exploitation of vulnerable people, and everyone has their part to play in seeing it eradicated. The government’s latest Procurement Policy Note (PPN) is, therefore, not just best practice for government supply chains but helpful guidance for all industry sectors looking to take a proactive approach to prevent modern slavery.

 

What is the Law on Modern Slavery?

 

The Modern Slavery Act 2015 outlines businesses’ legal responsibility to source goods and services legitimately and ethically. In the UK, any company that meets the four criteria below must publish a slavery and human trafficking statement each financial year. It should set out what steps they have taken to prevent modern slavery in their business and supply chains. If no steps have been taken, the statement must also confirm this. The criteria are:

  • if it is a “body corporate” or a partnership, wherever incorporated or formed
  • if it carries on a business, or part of a business, in the UK
  • if it supplies goods or services
  • if it has an annual turnover of £36 million or more

 

Eradicating modern slavery isn’t just a problem for big businesses, however. Many contracts and tender documents now include anti-slavery clauses and request compliance with the act as standard. This means smaller businesses, irrespective of turnover, should be prepared to demonstrate their actions to prevent the risk of modern slavery in their supply chains.

 

Ways to Identify and Manage Risk in Business

 

Although PPN 02/23 - Tackling Modern Slavery in Government Supply Chains is weighted towards government procurement and supplier management, the guidance can be helpful for businesses operating in the private sector too. It sets out four areas of activity and associated actions: identifying and managing risks in new procurementsassessing existing contractstaking action when victims of modern slavery are identified and training. 

 

1. Identifying and Managing Risks in New Procurement

 

Previously government departments were advised to identify and assess the risk of modern slavery in a new supplier according to a table of six core characteristics: industry type, type of workforce, supplier location, the context in which the supplier operates, commodity type and business/supply chain model. These criteria remain the same for the revised PPN but include an update to the sectors of concern to include cotton, PPE and polysilicon. 

Where an organisation is deemed to be at high risk of modern slavery, there is a new requirement for supply chain information to be supplied at the selection stage of new procurements. 

According to the guide, new procurements should be designed in line with the associated risk level, including (if appropriate) application of the Social Value Model. 

Key actions in this section also include reviewing and amending operating procedures and contract management processes and any related documentation in line with the updated guide. 

 

2. Assessing Existing Contracts

 

Actions in this area involve undertaking risk assessments on existing contracts and carrying out supply chain mapping exercises. The guidance also recommends strengthening contract management to manage risks and working with suppliers towards progressive improvement. Collaborating with suppliers to encourage transparency and ensure suppliers are not afraid to highlight issues as they arise is also key. 

The importance of proportionality is emphasised to avoid unnecessary burdens on SMEs and VCSEs.

 

3. Taking Action When Victims of Modern Slavery are Identified

 

Organisations must address modern slavery and human rights abuses immediately and proportionately. Transparency is key here, with a recommendation to ensure suppliers work openly and proactively to identify and resolve any issues and change working practices. 

In some instances, abuses may be a consequence of how an industry is organised. In such cases, a longer-term approach to address the root cause might be appropriate. 

Contracts should only be terminated as a last resort.

 

4. Training 

 

Ongoing training is essential to ensure staff involved in contract procurement and management can identify the risks and ensure that suspected instances of modern slavery are handled correctly.

All relevant staff should be made aware of the Modern Slavery Helpline on: 08000 121 700 or online.

This quick reference guidance provides further information on actions recommended in the PPN to mitigate the risk in supply chains.

 

Look for Contractor Verification 

 

With strengthening contract management, a key focus of the updated PPN, organisations may want to work with a supply chain risk management expert to verify their contractor base and bolster supply chain due diligence.

For example, many CHAS contractors are now qualified to the CHAS Elite standard which incorporates the Common Assessment Standard, a qualification that assesses businesses across 13 elements, including modern slavery. Meanwhile, CHAS is helping many more contractors to work towards this standard and all CHAS contractors are provided with free expert advice and guidance on modern slavery including an anti-modern-day slavery and people trafficking policy template. 

Clients can access CHAS-accredited contractors via the free CHAS Client portal, which enables users to search for organisations via trade, qualification level and location. The portal also includes a dashboard that offers companies complete visibility of their projects, the subcontractors in their supply chain network, and their individual compliance. 

Picture: a photograph of a person wearing a high-vis safety vest holding a pen and clipboard. Image Credit: Pexels

Article written by Alex Minett | Published 29 March 2023

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