It is estimated that 35.6m people globally are subjects of modern slavery – equivalent to the population of Canada. In the UK there were 1,746 reported cases of modern slavery in 2013 – a 47% increase on 2012. Slavery is very far from being a thing of the past and the UK Government is committed to ending this with new regulations this Autumn.
How does modern slavery apply to the hospitality sector?
If you think that slavery, servitude and forced labour, human trafficking, trafficking for prostitution or exploitation doesn’t occur in the hospitality sector you would be wrong. There has been concern over the last few years, for example over the risk of slavery in the hotel sector.
Three factors combine together to increase the risk of worker exploitation in the sector – high turnover of staff, seasonal nature of work and the use of agency workers. A guide by The University of Liverpool entitled “UK Hotels Policy Guide: How to protect your business against human trafficking, forced labour and labour exploitation” can be found HERE.
Modern slavery includes victims who are brought from overseas, as well as vulnerable persons in the UK, who are forced to work against their will. It also includes debt bondage with victims being forced to work to pay off debts that realistically they will never be able to do because their wages are so low and their debts are increasing. It includes forced labour – where victims are forced to work against their will, often for very long hours, for little or no pay, in dire conditions, under verbal or physical threats of violence.
The volume of low skilled jobs in the hospitality sector can provide the opportunity for unscrupulous individuals or agencies to put people into forced or bonded labour, taking their travel documents, wages and freedom. You must take steps to ensure that this does not happen in your business.
We cannot pretend that modern slavery does not exist in the UK in 2015 and within the hospitality sector.
The Modern Slavery Act 2015 (Transparency in Supply Chains) Regulations 2015 were introduced with the intention of achieving greater transparency in business and heightened corporate responsibility. The Regulations oblige relevant businesses to publish a statement setting out the steps they have taken to ensure there is no slavery in their business or supply chain. A failure to comply with this obligation to audit and report could result in bad publicity and have a negative impact on the business.
The regulations apply to businesses incorporated in the UK or carrying on business in the UK, supplying businesses or services, and with a turnover of more than £36million.
What do you need to do?
Your business needs to ascertain whether the reporting obligations under the Regulations apply, without delay, and prepare for compliance:
- If affected you need to produce an anti-slavery statement in accordance with the Regulations.
- You need to focus on your supply chain to ensure that there is no involvement in slavery at any point – however far back down the chain. For example, recruitment agencies are widely used in the hospitality industry but operators should be sure that the agencies they use carry out all the relevant checks on staff that they engage. Supply chains may involve raw materials where there is a risk of slavery e.g. fruit and vegetables which may be harvested by gangs of imported workers and these will also need to be checked carefully.
- Another area of concern may centre around economy accommodation which is sometimes used by criminal gangs who exploit workers and children.
- If you are a business with a UK subsidiary you will need to consider whether the Act applies only to the UK subsidiary or to the overseas parent as well.
- Franchises, which are common in the hospitality sector, are excluded from the Act unless the individual franchise has a turnover of £36million.
- An anti-slavery statement must be published for each financial year setting out the steps that the business has taken in that financial year to ensure that slavery and human trafficking are not taking place in any part of their own business or anywhere in their supply chain.
- The statement should be posted on the organisation’s website with a prominent link from the home page. In the unlikely event of you not having a website you must provide a copy of the statement to anyone making a written request for one within 30 days of receiving the request.
- The statement may include:
- the structure of the business and its supply chains;
- policies in relation to slavery and human trafficking;
- the due diligence process in relation to slavery and human trafficking in its business and supply chains;
- the parts of the business and supply chains where there is a risk of slavery and human trafficking taking place, and the steps it has taken to access and manage that risk;
- its effectiveness in ensuring that slavery and human trafficking is not taking place in its business and supply chains, measured against such performance indicators as it considers appropriate;
- the training available to staff in relation to slavery and human trafficking.
However, the content of the Statement is not mandatory.
When does the Act apply?
Whilst the Act is scheduled for this month, if your financial year end is close to this date then transitional arrangements will apply. All businesses which will be affected need to be considering their approach now and starting the due diligence process within the business and supply chain.
The Government has published statutory guidance covering what should be included in the Statement, how it should be researched and how modern slavery can be identified. See Transparency in Supply Chains A practical guide.
Sanctions for non-compliance
Primarily an organisation is likely to want to avoid any negative publicity which would surely accompany a failure to comply with the new Slavery Act as this could be costly in terms of its impact on business and potential loss of customers or investors.
The Secretary of State may apply for an injunction to force a business to prepare an anti-slavery statement but is likely to give a warning to remedy a failure to comply in the first instance.
Businesses should start to consider the following action points:
- Decide whether the new anti-slavery statement provisions apply to your business and if they do, who within your organisation will be responsible for ensuring compliance;
- Organise an audit of your business and suppliers;
- Review your policies and procedures as well as terms of business and contracts with suppliers with compliance with the Modern Slavery Act in mind;
- Train those in your organisation who are responsible for procurement in the requirements of the Act;
- Prepare your anti-slavery statement and obtain the relevant internal approvals before publishing it on your website.
The content of this page is a summary of the law in force at the present time and is not exhaustive, nor does it contain definitive advice. Specialist legal advice should be sought in relation to any queries that may arise.