The Modern Slavery Act 2015 Section 54 requires certain commercial organisations to publicly report the steps they are taking to combat slavery and human trafficking in their operations and supply chains.
Modern Slavery is a horrific abuse of human rights, and there are estimated to be over 130,000 people trapped in slavery in the UK today, 43% of whom are children. Criminal activities related to modern slavery include human trafficking, cannabis farming, sexual exploitation and forced labour on farms, in nail bars, car washes, construction, manufacturing, shops and bars.
Here we provide comprehensive guidance on how organisations can comply with Section 54 of the Modern Slavery Act 2015 to help combat this problem which affects every part of the UK.
Who must comply with the Modern Slavery Act 2015 Section 54?
Section 54 of the Modern Slavery Act 2015 imposes a transparency obligation on commercial organisations that meet specific criteria.
Compliance is mandatory for organisations that supply goods or services and carry on a business (or part of a business) in the UK and have a turnover of £36 million or more.
The £36 million threshold includes the global turnover of the organisation and its subsidiaries, not just UK-based operations. The turnover calculation includes revenue from goods sold and services provided but excludes taxes such as VAT.
Even if a subsidiary’s turnover is below the threshold, it is included in the parent organisation’s consolidated turnover, potentially bringing the parent company within scope of the Act.
Modern Slavery Act 2015 summary – what are the requirements?
Organisations that meet Section 54 criteria must produce and publish an annual modern slavery statement detailing the steps they have taken to ensure slavery and human trafficking are not occurring in their operations or supply chains.
At the moment Section 54 (4) (b) enables organisations to say that they have taken no steps towards addressing modern slavery in their supply chains, but this option is under review and may be removed in future.
What must be included in a modern slavery statement?
The government has not been specific about what a slavery and human trafficking statement should cover. However, they have indicated that addressing the following areas provides evidence of compliance:
1. Structure, business, and supply chains
Provide a detailed description of the organisation’s structure, including key locations, subsidiaries, and operational scope. For instance, specify the industries the organisation operates in and its role in the supply chain (for example, manufacturer, retailer, service provider).
Map out the organisation’s supply chain, including the types of suppliers, geographic locations, and tier levels (e.g., direct suppliers, subcontractors).
Identify specific areas in the supply chain or business operations where the risks of slavery and human trafficking are higher, such as sourcing from high-risk countries or industries with a history of labour exploitation.
A supply chain mapping tool can help you identify and visualise all tiers of your supply chain.
2. Policies on modern slavery
Include details of policies that address modern slavery, such as:
- A standalone anti-slavery policy.
- Ethical sourcing policies that outline expectations for suppliers.
- Whistleblowing policies that encourage reporting of unethical practices.
Describe how these policies are implemented, monitored, and communicated to employees, suppliers, and stakeholders.
Mention any codes of conduct that suppliers are required to sign, ensuring adherence to labour standards.
Publish your anti-slavery policy publicly to demonstrate your organisation’s commitment and allow suppliers and stakeholders to access it easily.
3. Due diligence processes
Explain how the organisation identifies risks of slavery and human trafficking within its supply chains or business operations. Include tools or frameworks used, such as supplier audits or risk assessments.
Describe steps taken to vet and select suppliers, such as pre-contract checks, on-site inspections, or requiring suppliers to complete modern slavery questionnaires.
Explain procedures for addressing non-compliance, such as terminating contracts or working with suppliers to improve practices.
Consider partnering with third-party organisations specialising in supply chain auditing to ensure an impartial evaluation.
4. Risk assessment and management
Highlight how risks are assessed and prioritised, such as focusing on high-risk regions, industries, or supplier tiers.
Detail ongoing monitoring efforts, such as supplier self-assessments, regular audits, or site visits.
Mention any partnerships with non-profit organisations (NGOs), industry groups, or multi-stakeholder initiatives that support the mitigation of modern slavery risks.
Use recognised risk management frameworks such as the UN Guiding Principles on Business and Human Rights to structure your approach.
5. Key performance indicators (KPIs)
Set measurable (SMART) KPIs to track the organisation’s progress in combating modern slavery, such as:
- Number or percentage of suppliers audited for modern slavery risks.
- Incidents of non-compliance identified and resolved.
- Percentage of employees or suppliers who have completed modern slavery training.
Include KPI results in the statement to demonstrate progress and identify areas for improvement.
Compare KPIs against industry standards or previous years to show trends over time.
6. Training and capacity building
Provide details of training programmes for employees, particularly those in procurement, HR, and compliance roles. Include the frequency of training and key topics covered, such as recognising warning signs of modern slavery. Our Modern Slavery Training covers topics like identifying red flags and understanding legal obligations.
Explain how suppliers are educated on modern slavery risks and your organisation’s expectations. For example, share resources, host workshops, or require suppliers to complete eLearning modules.
Mention efforts to raise awareness of modern slavery within the organisation, such as newsletters, posters, or events.
Practical tips for compliance with Section 54 of the Modern Slavery Act 2015
Organisations required to publish a modern slavery statement must ensure it is meaningful, accurate, and demonstrates a genuine commitment to ethical practices. Here are some tips to help you:
1. Start early
Drafting a modern slavery statement involves input from multiple departments, including procurement, legal, HR, and compliance teams. Starting several months before the end of the financial year ensures there is ample time to collect information, draft, review, and approve the statement.
Throughout the year, maintain records of audits, supplier engagements, training sessions, and risk assessments. This makes it easier to pull together relevant information when preparing the statement.
Allow sufficient time for the statement to go through internal governance processes. Ensure board approval and director sign-off happen before the publication deadline.
Actionable tip: Create a compliance calendar with deadlines for data collection, drafting, internal reviews, and final approvals.
2. Engage key stakeholders
Involve representatives from procurement, legal, HR, compliance, and operations teams to provide insights and ensure the statement addresses all areas of the organisation.
Collaborate with suppliers to obtain accurate information about their practices and any potential risks in their operations. Include them in discussions on improving supply chain transparency.
Keep the board of directors informed about compliance requirements, risks, and progress to secure their engagement and approval.
Actionable tip: Hold regular meetings or workshops with key stakeholders to align on responsibilities, progress, and challenges.
3. Assess risks regularly
Conduct regular reviews of the supply chain to identify and evaluate risks of modern slavery. Focus on high-risk areas such as suppliers in low-regulation countries or industries with known labour exploitation issues.
Update risk assessments based on changing factors, such as shifts in supply chain geography, new suppliers, or updated regulatory frameworks.
Use tools like heat maps or risk matrices to prioritise areas requiring immediate attention and resources.
Actionable tip: Integrate modern slavery risk assessments into broader enterprise risk management processes to ensure consistency and accountability.
4. Provide training
Organise training for employees, especially those in procurement, HR, compliance, and operations.
Engage suppliers in training sessions to raise awareness of modern slavery risks in their operations and improve their compliance with ethical standards. This collaborative approach strengthens your organisation’s overall commitment to combating modern slavery.
Actionable tip: Develop or source eLearning modules tailored to your industry and ensure training completion is tracked and reported in your modern slavery statement. At Praxis42, we can tailor our Modern Slavery Training to your organisation’s requirements.
4. Benchmark best practices
Analyse modern slavery statements from leading organisations in your industry to identify trends, innovative practices, and benchmarks for effective compliance.
Look at statements from recognised organisations and note how they structure their statements and address key areas like risk management and KPIs. For example, see Deloitte’s modern slavery and human trafficking statement.
Join trade groups or multi-stakeholder initiatives that promote anti-slavery efforts. These forums often share best practices and provide tools to enhance compliance.
Actionable tip: Use benchmarking insights to continually improve your organisation’s approach and ensure your statement stands up to stakeholder scrutiny.
What are the consequences of non-compliance with Section 54?
Failing to produce or publish a statement may result in reputational damage, legal challenges, and loss of consumer trust.
While the Act does not impose financial penalties for non-compliance, the government may seek an injunction to compel compliance, and public scrutiny can impact an organisation’s brand.
Support compliance with Modern Slavery Training
Our Modern Slavery Training supports your organisation to comply with the Modern Slavery Act 2015 Section 54. Transparency and proactive efforts are not only legal obligations but also essential steps in fostering an ethical business environment.
This course provides participants with the knowledge to prevent, identify and address modern slavery within the organisation’s processes and supply chains and raises awareness that slavery is hidden in plain sight.
To find out more about Modern Slavery Training please visit our website, or call our friendly team on info@praxis42.com or 0203 011 4242.
Please note that we can tailor Modern Slavery Training to specific roles and responsibilities within your organisation.
