New corporate statements on slavery and human trafficking
The Government has recently announced that, as of October 2015, every company with turnover of at least £36 million will be required to publish an annual statement detailing what steps it has (or hasn’t) taken to ensure that neither its own business nor that of its supply chain is involved in modern slavery or human trafficking.
The provisions will apply to all business sectors, providing the company carries out any part if its business in the UK, whether this is the provision of goods and/or services.
However, as the size of a business can be defined in a number of ways, the Government’s approach is been based solely on turnover. Indeed, the Government noted that taking into account other factors, such as employee numbers, could exclude those companies with very high turnover, but few employees, which nevertheless have significant purchasing power. The figure of £36 million is comparable to the Companies Act 2006 threshold for determining the size of a large company. Importantly, this will mean that small and medium-sized businesses are not caught by the new requirements.
Businesses must approve the annual slavery and human trafficking statement as follows:
- Companies – approved by the board of directors and signed by a director.
- Limited liability partnerships (LLPs) – approved by the LLP members and signed by a designated member.
- Limited partnerships – signed by a general partner.
- Other types of partnership – signed by a partner.
The statement must also be published on the company’s website, if there is one, with a prominent link to it on the home page.
As alluded to above, it’ll be possible for businesses to comply with the new provisions by stating that they have taken no steps. The issue, of course, is one of public perception and how customers, investors and the general public decide who to do business with.
The Government has indicated that it will be developing statutory guidance, which is intended to be published in October 2015. In the meantime, you can find more details about the Government’s announcement by clicking here.