Section 54 Modern Slavery Act: Trafficking in Supply Chains

Section 54 of the Modern Slavery Act 2015 is a key provision requiring transparency in supply chains and commenced on 29 October 2015.

A summary of the obligations under section 54 is available on The Guardian’s website here. In short, section 54 requires certain businesses to prepare a Modern Slavery Act trafficking statement each financial year, in simple language, which covers matters including the business’ policies relating to human trafficking, the risks of human trafficking in its business and how those risks are being managed.

The businesses required to produce a statement are those which carry on a business or part of a business in the UK, supply goods and services and have an annual turnover of £36m or more.

Where a business fails to comply with the requirement to produce a trafficking statement, the Secretary of State may compel the business to do so through civil law proceedings. Where a business’ trafficking statement reveals that it is doing little to tackle risks of trafficking in its supply chain, it is up to consumers, investors and NGOs to put pressure on those businesses to take sufficient steps. Note how Scottish anti-trafficking law goes much further and creates a separate criminal law offence against relevant business individuals whose business commits an offence under the Act and that offence was committed with the consent or connivance of, or attributable to any neglect of, the relevant individual.

For government guidance and much more detail on the effect of section 54, click here. In June 2017, CORE, the UK coalition on corporate responsibility, produced practical guides for businesses on complying with section 54. From analysing trafficking statements published so far, CORE has observed:

most statements indicate that companies have a limited understanding of the requirements of the [Modern Slavery] Act.

This is all the more reason for companies to utilise the CORE practical guides and for increased awareness about companies’ relatively new obligations under the Modern Slavery Act.