COVID-19: Reporting Modern Slavery

15 May 2020

Author: Richard Gray
Practice Area: Corporate - M&A, COVID-19

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On 20th April, the government published guidance for businesses in relation to addressing and reporting modern slavery risks during the COVID-19 pandemic. The guidance outlines challenges faced by businesses as a result of COVID-19.

Businesses that meet certain conditions are required to publish an annual modern slavery statement under Section 54 of the Modern Slavery Act 2015. The statement must set out steps taken to identify and address any modern slavery risks.

Who is required to publish a modern slavery statement?

An organisation must publish a Modern Slavery statement if it meets all of the following requirements;

  • a 'body corporate' or partnership, wherever incorporated or formed;
  • carries on a business, or part of a business, in the UK;
  • supplies goods or services; and
  • has an annual turnover of £36 million or more.

Businesses must continue to identify and address risks of modern slavery throughout their operations and supply chains during the COVID-19 pandemic. The government also asks businesses to consider how changes in demand and changes to operations may increase the risk of labour exploitation.

Delay of publishing modern slavery statements

If businesses struggle to publish their statement within the required timeframe as a direct result of COVID-19 for example, as a result of reduced staff capacity, no penalties will be given for a delay of up to 6 months. Within the statement, businesses should clearly explain their reason for delay and how it is related to the COVID-19 pandemic.

Reporting on risks

Businesses will have to report on the actions taken during this time to highlight measures taken to address new or increased risks. Risks relating to COVID-19 will take precedence over activities planned previous to the pandemic. When publishing their next statement, businesses should demonstrate how they monitored risks during the COVID-19 pandemic.

Included in the guidance, the government outlines an example of workers who may be more vulnerable to modern slavery during the COVID-19 pandemic. This includes:

1. Health and safety workers

  • Relevant local and national government policies must be implemented throughout the supply chain which may include implementing social distancing measures and paying statutory sick pay to help prevent the spread of COVID-19.

2. Supporting suppliers

  • To ensure workers receive wages for work completed, the government suggests that businesses should consider engaging with suppliers, which can involve paying for orders already in production.

Grievance procedures

Workers must continue to access grievance procedures and any new or modified procedures are made available.

Recruitment

If suppliers must recruit additional workers due to increased demand, businesses should ensure that they and their suppliers are undertaking checks during the recruitment process to ensure vulnerable workers are not exploited.

Emerging risks

With the possibility of increased modern slavery risks, businesses may need to undertake new risk assessments or reconsider priorities identified before the COVID-19 pandemic. This may include identifying parts of the workforce that may be more vulnerable. The Board of Directors should be kept updated on any emerging risks.

Conclusion

The guidance clearly does not provide a free pass for businesses that decide not publish a modern slavery statement or fail to undertake risk assessments. Whilst there is a temporary extension of up to 6 months to publish modern slavery statements, new statements must include new risks faced by businesses during the pandemic and how risks are monitored.

For more information or advice, please contact a member of the Corporate Team.

* This note reflects the position as at 14 May 2020.

*This information is for guidance purposes only and does not constitute, nor should be regarded, as a substitute for taking legal advice that is tailored to your circumstances.

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