Toughening the Modern Slavery Act

Thousands of companies doing business in the UK are already required to comply with the UK Modern Slavery Act (MSA), section 54. 

This requires companies - doing business in the UK with annual revenues of at least £36 million - to publish on their website a statement indicating the steps taken during their most recently completed fiscal year to ensure slavery and human trafficking are not occurring in their business or supply chains.

The MSA is a disclosure-only regulation, meaning that it does not require companies to adopt particular policies, procedures or other compliance measures to address modern slavery. Rather, it only requires companies to describe what they are (or are not) doing to address modern slavery.

As articulated in the Home Office guidance on Transparency in Supply Chains, “The provision seeks to create a race to the top by encouraging businesses to be transparent about what they are doing, thus increasing competition to drive up standards.”

On 22 September 2020, the UK Government published its response to the 2019 public consultation on the Modern Slavery Act in which the Government indicated it is “committing to an ambitious package of measures to strengthen and future-proof the Modern Slavery Act’s transparency legislation.”

Among other things, the Government stated that:

• It will require specific topics to be addressed in modern slavery statements,
• Establish a single reporting deadline for all companies and
• Require companies to submit their statements to a new Government registry.
• It would "consider enforcement options" for which "[l]egislative change would be required to introduce civil penalties for non-compliance with section 54 and assign an enforcement body."

The latest pronouncement from Dominic Raab suggests that we can expect to see the MSA given teeth in the form of civil penalties for non-compliance with section 54.