03 March 2016
In 2015 the UK passed the Modern Slavery Act, which for the first time called on large companies to set out steps taken to make their operations slavery free. At Focus on Labour Exploitation (FLEX) we strongly supported this move and asked the Government to go further – not just encourage, but require companies to take action in the face of abuses. However the Modern Slavery Act proposes carrots not sticks and leaves companies the option of doing nothing to stop slavery contributing to their profits. As many companies are preparing to report under the Act, we ask whether the UK has done enough to hold business to account and look to other countries for best practice examples.
The UK Modern Slavery Act makes it possible to prosecute companies for their involvement in modern slavery offences. However, to date no such prosecutions have taken place. In February 2016 a factory owner was jailed for 27 months after becoming the first businessman in the UK to be convicted of trafficking, following the exploitation of Hungarian workers in his mattress factory. The victims had been deceived into coming to the UK with the promise of decent work, but were instead paid less than £20 per week, working up to 16 hours per day and 7 days a week, housed in filthy conditions. While the factory owner was prosecuted, no action was taken against any associated company.
A search of FLEX’s Labour Exploitation Accountability Hub shows how much the UK can learn from other countries leading the way in holding business accountable for exploitation in their supply chains.
Belgium is one of the few countries where companies, alongside the people running them, have been successfully prosecuted for their involvement in human trafficking for labour exploitation. Labour inspectors will notify the clients, contractors, and subcontractors of a business if it repeatedly fails to pay its employees’ wages on time or severely underpays workers below the minimum wage. This simple action serves to warn clients and contractors about abuses up and down their supply chains, and provides an opportunity to take action, or to break a business relationship if the abuse continues. If the contractor fails to take any action and continues to turn a blind eye to the exploitation of workers by a subcontractor, then they can be prosecuted under the Belgian Social Criminal Code, and the official warning they were given can be used as evidence against them.
In Brazil, the ‘dirty list’ is an important way of preventing exploitation. Employers who have been found guilty of exploiting workers in slavery-like conditions are named in this list and feel the impact on their profits. The companies and individuals on the list cannot receive government funds, and their access to private financing is limited. The members of the National Pact for the Eradication of Slave Labour, a multi-stakeholder initiative by which major companies pledge to eradicate slave labour from their supply chains, also use the ‘dirty list’ to identify dishonest suppliers. As a result of public pressure and the work of activists and Campaigners, over 400 corporations, accounting for over 35% of Brazil’s GDP, had signed onto the pact by early 2014. The ‘dirty list’ has the potential to reach entire company supply chains, as it applies to those who directly and indirectly benefit from slave labour.
While the UK Government has taken positive steps towards addressing the issue of exploitation in corporate supply chains in its Modern Slavery Act, stronger actions are needed to hold companies to account. The Government should now look to international examples to take a firmer stand on slavery and send out the message that the UK will no longer tolerate exploitation in the supply chains of British firms.