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There is a "strong risk" of modern slavery in the global construction sector and its material supply chains, according to a recent LexisNexis report. The report found that forced labor and other exploitation that constitutes modern slavery are common, concealed and subject to inadequate prevention, policing and prosecution. A 2015 research report from the European Union also found that construction was number two on the list of economic sectors in the EU most prone to labor exploitation.
A major reason for the sector’s vulnerability to modern slavery is its high demand for low-skilled, manual, low-waged work. Chris Blythe, Chief Executive of the Chartered Institute of Building (CIOB), outlined further reasons in a report. "Our business models must take a large part of the blame: the global trend towards outsourcing and cut price contracting makes it easy for main contractors to duck out of their responsibilities," he wrote. "The plight of the most vulnerable gets lost among the long and complex supply chains."
There have been new allegations of modern slavery in the construction industry in recent months. In December, a report by six NGOs claimed that workers in New Zealand's construction industry had entered into debt bondages to pay recruitment fees of about $10,000 NZD each. Their work experience documents and passports were allegedly held until they had paid their fees off. A report in December by the NGO Licadho reported finding examples of debt bondage and child labor in brick factories in Cambodia. In November and December, arrests were made in the UK as part of the Home Office’s enforcement campaign called ‘Operation Magnify.’ The campaign identifies and targets businesses in high-risk industries, including construction, where illegal migrant workers are being employed.
Modern slavery is rising up the international agenda, and in recent years more countries have introduced legislation to make companies more accountable for human rights issues in their supply chain. The European Non-Financial Reporting Directive, which came into force in 2016, requires organizations with more than 500 employees to file annual reports on their policies, risks and outcomes relating to issues including human rights, bribery and employee working conditions.
The 2010 California Transparency in Supply Chains Act requires certain companies to report on their specific actions to eradicate slavery and human trafficking in their supply chains. The UK's 2015 Modern Slavery Act requires companies with an annual turnover of $51 million or more to submit a statement showing that their supply chain is free of modern slavery. This law has a global impact because it applies to any company that has a subsidiary based in the UK. The CIOB report speculates that “as these laws will force organizations to take responsibility for human rights issues both at home and abroad, their influence is likely to be far reaching over the longer term."
LexisNexis and partners are holding a free webinar to help firms in the construction sector mitigate the risk of modern slavery in their supply chains. The webinar will take place on Thursday January 19 at 4pm GMT/11am EST. The panelists will give an introduction to ethical labor issues in the construction sector, and discuss why construction firms of all sizes should respond to modern slavery commitments and legislation. They will identify good practice which construction companies can follow, and what a company can do if an employee spots someone they suspect to be a victim of modern slavery. They will also discuss how a company can measure progress in its efforts to mitigate the risk of modern slavery in its supply chain. Register Today