Understanding the US Government's Approach to Combating Modern Slavery
The US Government has introduced measures to make businesses culpable for the welfare of workers along the entire supply chain. SGS helps businesses understand forced labor and forced child labor in their supply chains.
Modern slavery, human trafficking and trafficking in persons are umbrella terms describing exploitation where a person cannot leave or refuse to work due to threats, violence, coercion, deception, and/or abuses of power. The International Labor Organization (ILO) estimated about 40.3 million people across the world were victims of modern slavery in 2016, with around 25 million in forced labor – 71% were women and girls, with one in four being children.
The ILO defines 'forced labor' as, "all work or service that is exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily"
An estimated 24.9 million people are trapped in forced labor:
64.2% in private sector – e.g. domestic work, construction or agriculture
19.2% in forced sexual exploitation
16% in forced labor imposed by state authorities
The global reach of modern supply chains means victims can easily be found in them without the knowledge of other economic operators. A 2018 US Government report, "List of Goods Produced by Child Labor or Forced Labor", highlighted 148 goods and 76 countries where child labor or forced labor was involved. For example, gold mining in Nigeria and Uganda using children and artificial flowers and Christmas decorations being made in China by forced labor.
The US Government is addressing the problem with legislation requiring businesses to ensure they identify and address issues like forced labor and forced child labor in their supply chains.
It can be difficult for brands and retailers to fully monitor working practices along their complex global supply chains. This is made more difficult by the lack of appropriate local legislation, corrupt officials, reduced border controls and the increased vulnerability of migrants' due to social and cultural factors. It is entirely possible that legitimate organizations may be contributing to this billion-dollar illegal economy without being cognizant of it.
With US laws making businesses responsible for human rights protection throughout the supply chain, it is important that companies fully understand their responsibilities and liabilities – ignorance is no longer a justifiable defense.
US regulations call for complete supply chain transparency, making brands, retailers and federal contractors liable for the actions of all business partners in the supply chain. This is an approach many other countries are also adopting.
Stakeholders should be aware of three pieces of US legislation:
• The Trade Facilitation and Trade Enforcement Act of 2015 (TFTEA)
• Federal Acquisition Requirements (FAR)
• Countering America's Adversaries Through Sanction Act (CAATSA)
The rules relating to modern slavery mean US Customs can automatically seize a shipment if they suspect forced labor has been involved in its manufacture;
The difficulty importers can face in ensuring their supply chains are free from any form of forced labor was recently highlighted by the discovery of North Korean workers at several factories in Eastern Europe, Asia and Africa. Previously, these workers had been hidden. In this scenario, the best approach for businesses is a program of due diligence to safeguard themselves and ensure their supply chains do not incorporate involuntary labor. Due diligence will provide them with some measure of defense against the legal liabilities associated with the actions of supply chain partners at any point in the supply chain.
SGS Due Diligence Solution
Operating in all industries, SGS has capabilities around the world to help businesses gain an insight into the risk associated with forced labor in their supply chains. They provide simplified and practical action plans to address the problem, utilizing the Plan-Do-Act-
· Plan: help ensure policies and code of conduct are compliant with regulations;
• Do: risk analysis to identify high-risk sites - factors such as the use of sub-contractors within a site are considered
• Act: monitor compliance within the supply chain – high-risk sites are audited first, within three months
• Check: following onsite compliance audits, a review process allowing continuous compliance
In addition to offering some defense against legal censure concerning incidents of modern slavery in the supply chain, having the right checks and balances in place can also help businesses secure further contracts.
For more information, please contact:
Corporate Responsibility Associate
Supply chain Assessment & Solutions
Tel: +1 (973) 461 7920
SGS is the world's leading inspection, verification, testing and certification company. SGS is recognized as the global benchmark for quality and integrity. With more than 95,000 employees, SGS operates a network of over 2,400 offices and laboratories around the world.