The Modern Slavery Act 2015 (MSA) is the UK’s primary legislation for combating slavery, servitude, forced labour and human trafficking. For businesses, the most relevant provision is Section 54, which requires certain organisations to publish an annual transparency statement describing the steps they take to prevent modern slavery in their operations and supply chains.
Failing to comply brings reputational damage, potential injunctive action from the Secretary of State and growing scrutiny from investors, customers and the media.
Who must report?
A commercial organisation must publish a modern slavery statement if it:
- Is a body corporate or partnership (wherever incorporated or formed)
- Carries on business, or part of a business, in the UK
- Has a total annual turnover of £36 million or more
Turnover is calculated on a group basis – if the combined turnover of a parent company and its subsidiaries meets the threshold, each entity in the group that individually carries on business in the UK must publish its own statement (or be covered by a group statement).
| Criterion | Requirement |
|---|---|
| Organisational form | Body corporate or partnership |
| UK nexus | Carries on business in the UK |
| Turnover threshold | £36 million or more |
| Reporting frequency | Annual, within 6 months of financial year end |
| Approval | Board of directors (or equivalent) |
| Publication | Website homepage link and government registry |
Even organisations below the threshold are encouraged to publish a voluntary statement, and many do so to meet customer or procurement expectations.
What must the statement include?
The Act does not prescribe a rigid format, but the government expects statements to cover:
- Organisational structure – what the business does, where it operates and its supply chains
- Policies – policies in relation to slavery and human trafficking
- Due diligence processes – steps taken to identify, assess and manage risk
- Risk assessment – parts of the business and supply chains where there is a risk of modern slavery and the steps taken to assess and manage that risk
- Effectiveness – key performance indicators to measure the effectiveness of actions taken
- Training – training available to staff on modern slavery and trafficking
A statement that simply declares “we have taken no steps” technically satisfies the legal requirement, but it invites severe reputational consequences and increasing regulatory attention.
Due diligence in practice
Effective due diligence goes beyond a paper exercise. Businesses should build modern slavery risk management into their existing compliance frameworks, alongside obligations under the Companies Act 2006 and data protection legislation.
Supply chain mapping
| Step | Action |
|---|---|
| Tier 1 suppliers | Identify all direct suppliers and their locations |
| High-risk sectors | Flag sectors with known slavery risks (agriculture, construction, textiles, electronics, domestic staffing) |
| High-risk geographies | Assess country-level risk using the Global Slavery Index or similar tools |
| Sub-contracting | Understand how far down the supply chain your visibility extends |
| Labour providers | Check that any employment agencies or gangmasters hold appropriate licences |
Risk indicators
Staff involved in procurement, HR and compliance should be trained to recognise warning signs:
- Workers unable to produce identity documents (held by employer)
- Excessive working hours with little or no pay
- Workers living in employer-provided accommodation in poor conditions
- Restriction of movement or communication
- Recruitment fees deducted from wages
- Workers appearing frightened, withdrawn or showing signs of abuse
Contractual protections
Include modern slavery clauses in supplier contracts that:
- Require suppliers to comply with the MSA and all applicable anti-slavery legislation
- Grant audit and inspection rights
- Require suppliers to cascade equivalent obligations to their own sub-contractors
- Allow termination for material non-compliance
The government registry
Since March 2021, organisations must register their modern slavery statement on the government’s modern slavery statement registry. This makes statements publicly searchable and comparable.
The registry records:
| Field | Detail |
|---|---|
| Reporting period | The financial year the statement covers |
| Turnover band | Confirming the organisation meets the threshold |
| Statement sign-off | Name and role of the director who approved the statement |
| Areas covered | Which of the six recommended areas the statement addresses |
| Policies and due diligence | Whether the organisation describes its policies and risk assessment approach |
Enforcement and consequences
The MSA does not impose direct financial penalties for failing to publish a statement. However, enforcement has tightened:
- The Secretary of State can seek an injunction in the High Court to compel publication; breach of an injunction is contempt of court, carrying an unlimited fine
- The government has named non-compliant organisations publicly
- Procurement exclusion – the Public Contracts Regulations 2015 allow contracting authorities to exclude bidders convicted of modern slavery offences; many public bodies also require a satisfactory modern slavery statement as a condition of tendering
- Investor pressure – ESG-focused investors increasingly treat modern slavery compliance as a material governance issue
- Reputational risk – media and NGO scrutiny of statements has intensified since the Act came into force
Practical steps for compliance
- Calculate your turnover on a group basis to confirm whether Section 54 applies
- Map your supply chain and identify sectors and geographies with elevated risk
- Conduct a risk assessment – prioritise areas where the risk of modern slavery is highest
- Embed policies – create or update your modern slavery policy and integrate it into your supplier code of conduct
- Train relevant staff – procurement teams, HR and senior management should understand the risk indicators and reporting channels
- Set measurable KPIs – track the number of supplier audits, training sessions delivered, incidents reported and remediation actions taken
- Draft and publish your statement – ensure it is approved by the board, signed by a director and published on your website homepage with a prominent link
- Register on the government portal within 6 months of your financial year end
- Review annually – update the statement each year to reflect progress and any new risks identified
Interaction with other legislation
Modern slavery due diligence does not operate in isolation. The same supply chain risks may also engage Section 172 of the Companies Act 2006 (directors’ duty to have regard to employees and community impact), the Criminal Finances Act 2017 (corporate liability for failure to prevent the facilitation of tax evasion) and the Gangmasters (Licensing) Act 2004 (licensing requirements for labour providers in agriculture, horticulture, shellfish gathering and food processing). Building a joined-up compliance framework that addresses these overlapping obligations is more efficient than treating each requirement in isolation.