Almost ten years since the Modern Slavery Act was passed into UK law, the Home Office has now published updated statutory guidance for organisations across the UK. This comes amidst a new inquiry into the nation’s framework for addressing forced labour in international supply chains. As the House of Lords warned that the UK has fallen behind global best practice, the House of Commons is investigating the effectiveness of the UK’s approach, considering if new laws are needed to strengthen companies’ approach to forced labour.
In total, 50 million people worldwide are estimated to be enslaved, with 28 million in forced labour and 22 million in forced marriage. This number has risen in recent years due to conflicts, climate change, and the impact of COVID-19. Governments and media are increasingly scrutinising forced labour risks, prompting businesses to take action: In December 2024, a BBC investigation found major UK supermarkets at risk of forced labour. Also that month, the EU’s forced labour ban officially took effect, prohibiting products made with forced labour from entering the EU market. Meanwhile Australia, France, Germany, Norway, and Switzerland all require large companies to report on their actions to mitigate forced labour risks.
What is the Modern Slavery Act?
The Modern Slavery Act 2015 was brought in by the Coalition Government in 2013 under the then Home Secretary Theresa May. The Act consolidates existing offences of slavery and trafficking and introduces new civil penalties for those involved and provides mechanisms for seizure of assets. It also establishes an independent Anti-Slavery Commissioner as well as the reporting requirement for large companies.
Under the Act, organisations with over £36m in revenue must publish a slavery and human trafficking statement within six months of their financial year. This statement should detail the steps taken to identify and eradicate slavery from the supply chain, including:
- Slavery and human trafficking policies
- Due diligence procedures
- Risk assessments and KPIs
- Staff training
Potential victim referrals to the National Referral Mechanism across English and Wales are soaring, with a record high of 16,996 referrals in recent years. The average wait for a conclusive decision on a modern slavery case from the Home Office is more than 500 days, according to government figures. Some fear that their cases might never get reviewed.
Recent figures show that more than 23,000 suspected victims, including children, are still waiting for a decision from the Home Office regarding their status. Some of these people have already spent up to four years in a safe house, according to the Independent Anti-Slavery Commissioner.
What is in the UK’s new guidance on modern slavery in supply chains?
The Home Office has developed its new guidance in consultation with businesses, public bodies, civil society organisations, trade unions and academics. The Act requires an organisation to be transparent about what is happening within the business. This means that if an organisation has taken no steps to ensure modern slavery is not taking place, they must still publish a statement stating this to be the case.
Commitment to continuous improvement
Businesses must recognise that modern slavery compliance is not a one-time obligation but an evolving process. Companies should improve their practices year-on-year, building upon previous efforts and publicly documenting their progress. It is recommended that past modern slavery statements remain accessible online to allow stakeholders, including investors and customers, to track developments over time.
Leveraging influence to drive change
Businesses should assess their leverage in influencing modern slavery risk mitigation, particularly within their supply chains. While smaller businesses may have limited influence compared to major buyers, they can increase their impact through collaborative efforts. Offering capacity-building initiatives, incentives for compliance, or forming alliances with industry peers can enhance leverage and encourage suppliers to adopt ethical labour practices.
Modern slavery audits: An improved approach
Organisations should not rely solely on audits to detect modern slavery risks. While audits are valuable, they must be complemented by worker-centred approaches such as:
- Establishing worker voice mechanisms, ensuring employees can safely report concerns.
- Engaging with worker associations and trade unions to provide additional oversight and accountability.
- Conducting independent assessments beyond traditional compliance checks to identify systemic risks.
Voluntary compliance for non-mandated organisations
Although the Modern Slavery Act applies to organisations with an annual turnover of £36 million or more, smaller businesses, public bodies, and other entities are strongly encouraged to publish modern slavery statements voluntarily. This proactive approach demonstrates a commitment to ethical business practices, enhances corporate reputation, and prepares organisations for potential future regulatory changes.
Effective remediation over contract termination
In instances where modern slavery is identified, businesses should prioritise remediation efforts rather than immediately severing contracts. Cutting ties with a supplier may inadvertently worsen conditions for affected workers, leaving them more vulnerable to exploitation. Instead, companies should work towards sustainable solutions that improve working conditions and ensure adequate remedies for impacted workers.
Responsible disengagement from suppliers
If disengagement from a supplier or business partner becomes necessary due to persistent non-compliance, businesses must consider the broader implications. A responsible exit strategy should be developed to minimise adverse effects on workers, ensuring that employment opportunities are not abruptly removed, thereby exacerbating their vulnerability.
Business benefits of addressing modern slavery
Beyond legal compliance, tackling modern slavery can bring significant business advantages, including:
- Strengthening brand reputation and consumer trust.
- Enhancing investor confidence and meeting Environmental, Social, and Governance (ESG) expectations.
- Reducing operational and legal risks associated with unethical supply chain practices.
- Improving supplier relationships and securing more stable, ethical supply chains.
Key modern slavery compliance considerations for businesses
Modern slavery compliance requires a proactive and transparent approach. By focusing on continuous improvement, integrating international standards, and prioritising worker protections, businesses can ensure they meet both their legal obligations and ethical responsibilities. New Home Office guidance says compliance should go beyond producing statements. It should drive meaningful change that protects workers, strengthens supply chains, and enhances corporate integrity.
Focusing on the spirit of the law
The emphasis should not just be on producing a legally compliant modern slavery statement but on fostering a culture that genuinely protects workers. Section 54 of the MSA seeks to ensure companies take meaningful action against modern slavery rather than merely meeting minimum reporting standards.
Integration with international frameworks
Companies already following international guidelines, such as the UN Guiding Principles on Business and Human Rights (UNGPs) and the OECD Due Diligence Guidance, should align their modern slavery compliance with these frameworks. This ensures a comprehensive approach that meets both UK and global expectations.
Transparency in modern slavery statements
Organisations must clearly disclose:
- Identified modern slavery risks within their operations and supply chains.
- The steps taken to mitigate and address these risks.
- Progress made over time, ensuring continuous improvement.
- Remediation actions taken where issues have been found.
The guidance also distinguishes between “good” and “best” practices, allowing organisations to benchmark their disclosures against industry leaders.
Acknowledging and reporting identified cases
The updated guidance makes it clear that businesses conducting thorough assessments will inevitably uncover instances of modern slavery. Rather than treating this as a failure, companies should disclose such findings transparently and outline the actions taken to remedy them. Proactive reporting helps build credibility and demonstrates a genuine commitment to ethical business practices.
Commitment to ongoing improvement
Modern slavery compliance should be seen as a continuous journey. Organisations are encouraged to refine their approaches, strengthen internal policies, and report on year-on-year improvements.
Worker-centred risk assessments
Risk assessments should prioritise risks to workers rather than focusing on potential reputational or financial risks to the business. This shift in perspective ensures that compliance efforts genuinely benefit those most vulnerable to exploitation.
Strengthening stakeholder collaboration
Partnerships with key stakeholders, including workers, trade unions, NGOs, and regulatory bodies, are critical. By engaging with those on the ground, businesses can develop more effective strategies to combat modern slavery and ensure long-term compliance.
