(1)The Modern Slavery Act 2015 is amended as follows.
(2)In section 54 (transparency in supply chains etc), omit subsection (11).
(3)After section 54ZC (inserted by section 48(3)) insert—
54ZDEnforcement: financial penalties
(1)The Secretary of State may by regulations make provision for and in connection with the imposition of a financial penalty on a commercial organisation or public authority which, without reasonable excuse, fails to comply with a duty imposed by or under this Part.
(2)Regulations under subsection (1) must provide that the amount of a financial penalty imposed on a commercial organisation or public authority (excluding any interest) may not exceed the higher of—
(a)1% of the relevant amount;
(b)£1 million.
(3)Regulations under subsection (1) must provide that only one financial penalty may be imposed on a commercial organisation or public authority in relation to each slavery and human trafficking statement which is prepared, or required to be prepared, by the organisation or authority for a financial year.
(4)The provision that may be made by regulations under subsection (1) includes, in particular, provision—
(a)for functions in relation to the imposition of financial penalties to be exercisable by the Secretary of State or a person specified in the regulations (“the enforcement authority”);
(b)about the matters to be taken into account by the enforcement authority in determining the amount of a financial penalty;
(c)requiring the enforcement authority to give a warning notice to an organisation or authority before imposing a financial penalty on it;
(d)allowing an organisation or authority to make representations to the enforcement authority in connection with a proposal to impose a financial penalty on it;
(e)for the recovery of costs incurred by the enforcement authority in connection with the imposition of a financial penalty from the organisation or authority on which the penalty is imposed;
(f)for the payment of interest in the event of the late payment of a financial penalty or of costs recoverable by virtue of paragraph (e);
(g)conferring rights of appeal against a financial penalty or a requirement to pay costs;
(h)about the enforcement of a financial penalty or a requirement to pay costs;
(i)about the publication of information relating to an organisation or authority on which a financial penalty is imposed.
(5)A financial penalty received by the enforcement authority is to be paid into the Consolidated Fund.
(6)The Secretary of State may by regulations amend the amount for the time being specified in subsection (2)(b) in order to take account of changes in the value of money.
(7)In this section the relevant amount —
(a)in relation to a commercial organisation, means the organisation’s total turnover determined in accordance with regulations made under section 54(3);
(b)in relation to a public authority, means the authority’s total budget determined in accordance with regulations made under section 54ZA(3).
54ZEEnforcement: other The duties imposed on commercial organisations and public authorities by or under this Part are enforceable by the Secretary of State bringing civil proceedings in the High Court for an injunction or, in Scotland, for specific performance of a statutory duty under section 45 of the Court of Session Act 1988.
(4)In section 58(4) (regulations subject to the affirmative procedure), after paragraph (jze) (inserted by section 47(4)) insert—.
(jzf)regulations under section 54ZD(1) (financial penalties);
Inserts a new provision into Modern Slavery Act 2015 — after section 54ZC
Amends Modern Slavery Act 2015, section 54 — Transparency in supply chains etc
Modern Slavery Act 2015 — section 54
(1) A commercial organisation within subsection (2) must prepare a slavery and human trafficking statement for each financial year of the organisation.
(2) A commercial organisation is within this subsection if it—
(a) supplies goods or services, and
(b) has a total turnover of not less than an amount prescribed by regulations made by the Secretary of State.
(3) For the purposes of subsection (2)(b), an organisation's total turnover is to be determined in accordance with regulations made by the Secretary of State.
(4) A slavery and human trafficking statement for a financial year is—
(a) a statement of the steps the organisation has taken during the financial year to ensure that slavery and human trafficking is not taking place—
(i) in any of its supply chains, and
(ii) in any part of its own business, or
(b) a statement that the organisation has taken no such steps.
(5) An organisation's slavery and human trafficking statement may include information about—
(a) the organisation's structure, its business and its supply chains;
(b) its policies in relation to slavery and human trafficking;
(c) its due diligence processes in relation to slavery and human trafficking in its business and supply chains;
(d) 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;
(e) 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;
(f) the training about slavery and human trafficking available to its staff.
(6) A slavery and human trafficking statement—
(a) if the organisation is a body corporate other than a limited liability partnership, must be approved by the board of directors (or equivalent management body) and signed by a director (or equivalent);
(b) if the organisation is a limited liability partnership, must be approved by the members and signed by a designated member;
(c) if the organisation is a limited partnership registered under the Limited Partnerships Act 1907, must be signed by a general partner;
(d) if the organisation is any other kind of partnership, must be signed by a partner.
(7) If the organisation has a website, it must—
(a) publish the slavery and human trafficking statement on that website, and
(b) include a link to the slavery and human trafficking statement in a prominent place on that website's homepage.
(8) If the organisation does not have a website, it must provide a copy of the slavery and human trafficking statement to anyone who makes a written request for one, and must do so before the end of the period of 30 days beginning with the day on which the request is received.
(9) The Secretary of State—
(a) may issue guidance about the duties imposed on commercial organisations by this section;
(b) must publish any such guidance in a way the Secretary of State considers appropriate.
(10) The guidance may in particular include further provision about the kind of information which may be included in a slavery and human trafficking statement.
(11) The duties imposed on commercial organisations by this section are enforceable by the Secretary of State bringing civil proceedings in the High Court for an injunction or, in Scotland, for specific performance of a statutory duty under section 45 of the Court of Session Act 1988.
(12) For the purposes of this section—
“commercial organisation” means—
(a) a body corporate (wherever incorporated) which carries on a business, or part of a business, in any part of the United Kingdom, or
(b) a partnership (wherever formed) which carries on a business, or part of a business, in any part of the United Kingdom,
and for this purpose “business” includes a trade or profession;
“partnership” means—
(a) a partnership within the Partnership Act 1890,
(b) a limited partnership registered under the Limited Partnerships Act 1907, or
(c) a firm, or an entity of a similar character, formed under the law of a country outside the United Kingdom;
“slavery and human trafficking” means—
(a) conduct which constitutes an offence under any of the following— (i)section 1, 2 or 4 of this Act, (ii)section 1, 2 or 4 of the Human Trafficking and Exploitation (Criminal Justice and Support for Victims) Act (Northern Ireland) 2015 (c. 2 (N.I.)) (equivalent offences in Northern Ireland), (iii) section 1 or 4 of the Human Trafficking and Exploitation (Scotland) Act 2015 (asp 12) (equivalent offences in Scotland), or
(b) conduct which would constitute an offence in a part of the United Kingdom under any of those provisions if the conduct took place in that part of the United Kingdom.
Amends Modern Slavery Act 2015, section 58 — Regulations
Modern Slavery Act 2015 — section 58
(1) Any power of the Secretary of State to make regulations under this Act is exercisable by statutory instrument.
(2) A statutory instrument containing regulations made by the Secretary of State under this Act is subject to annulment in pursuance of a resolution of either House of Parliament, unless—
(za) it contains only regulations under section 19A(5) or 26A(5) (power to prescribe persons responsible for electronic monitoring of compliance with orders under Part 2),
(a) it contains only regulations under section 61 (commencement), or
(b) it contains regulations to which subsection (4) applies.
(3) A statutory instrument containing regulations to which subsection (4) applies may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.
(4) This subsection applies to—
(a) regulations under section 14(4) (power to amend Schedule 1);
(aa) regulations under section 19(6A) (notification requirements for slavery and trafficking prevention orders);
(ab) regulations under section 26(6A) (notification requirements for slavery and trafficking risk orders);
(b) regulations under section 31(1) (power to amend section 30);
(c) regulations under section 43(9) which remove a public authority from Schedule 3, other than in consequence of the authority having ceased to exist;
(d) regulations under section 43(9) which contain the provision mentioned in section 43(10) (power to modify section 43);
(e) regulations under section 45(8) (power to amend Schedule 4);
(f) regulations under section 48(6) (independent child trafficking guardians: general regulations);
(g) regulations under section 50 (identifying and supporting victims);
(h) regulations under section 52(6) which remove a public authority from section 52(5), other than in consequence of the authority having ceased to exist;
(i) regulations under section 54(2) (minimum turnover for application of section 54);
(j) the first regulations under section 54(3) (definition of turnover for purposes of section 54);
(jza) regulations under section 54(5) (power to amend Schedule 4ZA);
(jzb) regulations under section 54ZA(2) (minimum total budget for application of section 54ZA);
(jzc) the first regulations under section 54ZA(3) (definition of total budget for purposes of section 54ZA);
(jzd) regulations under section 54ZA(11) which—
(i) add a public authority to section 54ZA(10), or
(ii) amend an entry in that provision relating to a public authority other than in consequence of the authority having changed its name;
(jze) regulations under section 54ZB(6) (power to amend time period in section 54ZB(5)(b));
(jzf) regulations under section 54ZD(1) (financial penalties);
(ja) ................................
(k) regulations under section 57(2) (consequential provision) which amend, or repeal any provision of, an Act.
(5) Regulations made by the Scottish Ministers under section 43(7)—
(a) are subject to the affirmative procedure if they contain—
(i) provision removing a public authority from Schedule 3, other than in consequence of the authority having ceased to exist, or
(ii) the provision mentioned in section 43(10) (power to modify section 43);
(b) otherwise, are subject to the negative procedure.
(6) The power of the Department of Justice in Northern Ireland to make regulations under section 43(8) is exercisable by statutory rule for the purposes of the Statutory Rules (Northern Ireland) Order 1979 (S.I. 1979/1573 (N.I. 12)).
(7) Regulations made by the Department of Justice in Northern Ireland under section 43(8) are subject to negative resolution (within the meaning of section 41(6) of the Interpretation (Northern Ireland) Act 1954 (c. 33 (N.I.))), unless they are regulations to which subsection (9) applies.
(8) The Department of Justice in Northern Ireland may not make regulations to which subsection (9) applies unless a draft of the regulations has been laid before, and approved by a resolution of, the Northern Ireland Assembly.
(9) This subsection applies to regulations under section 43(8) which contain—
(a) provision removing a public authority from Schedule 3, other than in consequence of the authority having ceased to exist, or
(b) the provision mentioned in section 43(10) (power to modify section 43).
(10) Regulations made under this Act may—
(a) make different provision for different purposes;
(b) include saving, transitional, transitory, supplementary or consequential provision.
(10A) Regulations under section 19A(5) or 26A(5) may make different provision for different areas.
(11) This section (apart from subsection (10)) does not apply to regulations under paragraph 5 of Schedule 2.
Explanatory Notes · published by the Government with the Bill
374. This clause introduces powers for the Secretary of State to investigate and impose financial penalties on organisations that do not comply with the requirement to prepare and submit a slavery and trafficking statement in line with section 54, section 54ZA and section 54ZB.
375. Subsection (1) amends section 54 of the Modern Slavery Act 2015.
376. Subsection (2) removes subsection 11 from section 54.
377. Subsection (3) inserts new section 54ZD Enforcement: financial penalties and new section 54ZE Enforcement: Other after section 54ZC.
378. Subsection (1) of new section 54ZD enables the Secretary of State to make regulations providing for and in connection with the imposition of a financial penalty on a commercial organisation or public authority which fails to comply with a duty imposed on it in relation to slavery and human trafficking statements.
379. Subsection (2) of new section 54ZD states that the regulations must provide that the amount of a financial penalty may not exceed 1% of the relevant amount (defined at new section 54ZD(7)) or £1 million, whichever is the highest.
380. Subsection (3) of new section 54ZD states the regulations must provide that only one financial penalty may be imposed on a commercial organisation or public authority in relation to each slavery and human trafficking statement that is prepared or is required to be prepared by the organisation for a financial year.
381. Subsection (4) of new section 54ZD outlines the provisions that may be made but regulations under subsection (1)
382. Subsection (4)(a) provides for regulations in relation to the imposition of financial penalties to be exercisable by the Secretary of State or a person specified in the regulations (“the enforcement authority”).
383. Subsection (4)(b) provides for regulations about the matters to be taken into account by the enforcement authority in determining the amount of a financial penalty.
384. Subsection (4)(c) provides for regulations to require the enforcement authority to give a warning notice to an organisation or authority before imposing a financial penalty.
385. Subsection (4)(d) provides for regulations that allow an organisation or authority to make representations to the enforcement authority in relation to a proposed financial penalty.
386. Subsection (4)(e) provides for regulations for the recovery of costs by the enforcement authority in connection with the imposition of a financial penalty.
387. Subsection (4)(f) provides for regulations for the payment of interest in the event of late payment of a financial penalty or costs recoverable.
388. Subsection (4)(g) provides for regulations that confer rights of appeal against a financial penalty or requirement to pay costs.
389. Subsection (4)(h) provides for regulations about the enforcement of a financial penalty or requirement to pay costs.
390. Subsection (4)(i) provides for regulations about the publication of information relating to an organisation or authority on whom a financial penalty is imposed.
391. Subsection (5) of new section 54ZD requires that a financial penalty received by the enforcement authority is paid into the Consolidated Fund.
392. Subsection (6) of new section 54ZD allows the Secretary of State to, by regulation, amend the amount specified in subsection (2)(b) to take account of any changes in the value of money.
393. Subsection (7) of new section 54ZD defines “the relevant amount” as an organisation’s total turnover, in relation to a commercial organisation as determined in accordance with regulations under section 54(3); or a public authority’s total budget, as determined in accordance with regulations made under section 54ZA(3).
394. New section 54ZE states that the penalties imposed on reporting organisations are enforceable by the Secretary of State by bringing Civil Proceedings via the High Court, in the case of an injunction. For Scotland, this section is enforceable under section 45 of the Court of Session Act 1988.
395. Subsection (4) of clause 49 provides that powers to amend regulations for financial penalties are subject to the affirmative procedure.