The UK Home Office public consultation on proposed changes to the slavery and human trafficking statement provisions of the Modern Slavery Act 2015 (MSA 2015) will close on 17 September 2019.

The consultation reflects some of the findings of the final report and recommendations of the Independent Review into MSA 2015. It includes proposals for requiring (as opposed to just suggesting) certain types of information to be included in slavery and human trafficking statements; specifying a particular date for annual publication of statements, and extending the transparency in supply chains obligations to certain public sector organisations.

Here are some of the key points proposed in the consultation document:

Improving quality / content of statements

As it stands, both section 54 of MSA 2015 and the UK Government’s Transparency in Supply Chains guidance set out categories of information which organisations “may” or “should” include – not “must” include – in their statements:

  1. the organisation’s structure, its business and its supply chains;
  2. its policies in relation to slavery and human trafficking;
  3. its due diligence processes in relation to slavery and human trafficking in its business and supply chains;
  4. the parts of its business and supply chains where there is a risk of slavery and human trafficking taking place, and the steps it has taken to assess and manage that risk;
  5. its effectiveness in ensuring that slavery and human trafficking is not taking place in its business or supply chains, measured against such performance indicators as it considers appropriate;
  6. the training about slavery and human trafficking available to its staff.However, the Home Office believes that too many organisations are failing to go beyond minimum compliance requirements with their statements, “highlighting inconsistency across the reporting areas and a lack of uptake in voluntarily covering the Home Office’s suggested content”. Therefore one consultation proposal is to make it compulsory to include certain information in statements, perhaps with an allowance for organisations to state why they have not reported on one or more of the criteria.It is also notable that the consultation includes questions about the resources (for example, number of individuals) which organisations would need to devote to obtaining the six categories of information listed above, were reporting on those to be made mandatory.

Compliance monitoring

The UK Government has indicated that it will develop an online registry of slavery and human trafficking statements published under MSA 2015. The Government intends to legislate to require organisations to publish their statements on that registry as well as on their own websites (if they have a website).

Significantly, the Home Office also states in the consultation that it is “considering how [to] incorporate indicators of reporting quality into the registry.” So the aim of the centralised registry, as with the current TISCreport and Modern Slavery Registry databases, would not only be to increase accessibility of statements but also to enable enhanced scrutiny on compliance and on best practice, as well as enabling comparisons between organisations or from year-to-year within the same organisation.

When to publish?

At present organisations are expected to publish their statements within 6 months of their financial year end (see UK Government guidance). The Home Office now proposes to introduce a single reporting deadline by which all organisations must publish their statements every year. This could be March 31 (the financial year end of most UK-registered companies), 31 December (end of calendar year) or some other date.

Enforcement

The power to enforce section 54 of MSA 2015 currently rests with the Secretary of State, who would need to bring legal proceedings to obtain a court order requiring a non-compliant organisation to publish a statement. This power does not appear to have been used to date.

The Independent Review into MSA 2015 recommended strengthened enforcement mechanisms, including establishment of an enforcement body for imposing sanctions on businesses which fail to publish a slavery and human trafficking statement.

What might these sanctions be? In the consultation document the Home Office seeks views on a gradual and proportionate enforcement approach, with initial warning letters to non-compliant businesses then followed by imposition of financial penalties (perhaps capped or set as a percentage of turnover).

Public sector in scope

The consultation also explores whether the requirement to publish slavery and human trafficking statements should be extended to public sector organisations which are not currently caught by MSA 2015. Mirroring the present turnover threshold, one proposal is to require reporting by public sector organisations which have an annual budget exceeding £36million.

The Home Office states that public bodies in scope would be “those which exercise functions of a public nature or who are providing, under contract with a public authority, any service whose provision is a function of that authority”. A large number of public bodies across the UK have already voluntarily published slavery and human trafficking statements in recent years. The Prime Minister and the Home Secretary have announced that the central UK Government will publish a statement this year. And from 2020/21 onwards ministerial departments will do the same, regardless of their annual budgets.

Responding to the consultation

Anyone can respond to the consultation by completing the online response form. The deadline for responding is 17 September 2019.

The Government believes that MSA 2015 “sparked a trend for transparency.” Governmental and public scrutiny of slavery and human trafficking statements is now being moved up another gear. You should assess which parts of your business meet the MSA 2015 qualifying criteria for publication of a statement, whether your existing statements are legally compliant, and how best to manage and reflect legal requirements and best practice in future.