Construction and the Modern Slavery Act

Tackling Exploitation in the UK

TACKLING EXPLOITATION
IN THE UK

MAY1 2018

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Researched and written by Emma Crates, freelance writer and journalist.
Follow Emma on Twitter @CratesEm
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Copyright CIOB 20182

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Some definitions
Forced labour
Most situations of slavery or human trafficking are covered by International Labour Organization’s (ILO)
definition of forced labour:“...all work or service which is exacted from any person under the threat of a penalty and for which theperson has not offered himself or herself voluntarily.”1
Exploitation
There is no clear legal definition of exploitation but United Nations and European Conventions say that
exploitation includes forced labour, servitude and slavery.
One definition is:“Taking unfair advantage of another person in a work situation, where the element of ‘unfairness’ isestablished against a benchmark established in law.” 2
Debt bondage or bonded labour
This is a specific form of forced labour, in which the element of compulsion is through debt. It ischaracterised by a creditor-debtor relationship in which the worker is trapped by an unsustainably highdebt to their employer.
Human trafficking
The recruitment, transportation, transfer, harbouring or receipt of persons by means of the threat or use
of force or other forms of coercion...to achieve the consent of a person having control over another person
for the purpose of exploitation.3
Human rights due diligence“An ongoing risk management process...to prevent, mitigate and account for how [an organisation]
addresses its adverse human rights impacts.”4 - It includes four steps:• Assessing actual and potential human rights impacts• Integrating and acting on findings• Tracking responses• Communicating how the impacts are addressed.
Decent work“…productive work under conditions of freedom, equity, security and dignity, in which rights areprotected and adequate remuneration and social coverage are provided.”5
Decent work:• Is productive and secure• ensures respect for labour rights• provides an adequate income• offers social protection• includes social dialogue, union freedom, collective bargaining and participation

1
2
3
4
5

International Labour Organization (ILO) Forced Labour Convention, 1930 (29)Joseph Rowntree Foundation, Forced Labour’s business Models and Supply Chains, November 2013
The Council of Europe, Convention on Action against Trafficking in Human Beings, 2005 - The convention came into force in the UK on 1 April 2009
United Nations (UN), Guiding Principles on Business and Human Rights, Implementing the United Nations “Protect, Respect and Remedy” Framework, 2011
ILO, Report of the Director-General: Decent Work, 1999

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Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Foreword by Kevin Hyland OBE
Construction is a crucial sector within the UK economy. In 2016, the value of new construction
work reached its highest level on record at over £99 billion and the sector created over 55,000
new jobs.6 However, with this success comes a challenge: modern day slavery is hidden on
construction sites across the UK today.
Globally, an estimated
16 million people werein forced labour within
the private sector in 2016.
Construction ranks second
only to domestic work forprevalence of this abuse, at
18% and 24% respectively.7
This high risk status is due toa number of causes, including
a labour pool comprised largely of lower skilled andmigrant workers. Additionally, the trend towards
outsourcing has led to increasingly complex supply
chains. Reliance on labour agencies, without properdue diligence of those providers, creates the perfectconditions for forced labour to occur. Norway has
recognised this with its recent introduction of a limiton the layers within construction supply chains forcompanies undertaking public contracts.8
The CIOB and other organisations are showing
leadership, boldly bringing this issue to light andproviding clear and actionable measures to address
it. As the UK’s first independent anti-slavery
commissioner, mandated to spearhead our national
efforts to eradicate modern slavery, I am pleased tosee this timely and in-depth report. It is an important
addition to the understanding of slavery withinconstruction and does not flinch from uncomfortable
truths.
Intelligent companies will not shy away from these,
recognising instead that tackling slavery is not only amoral necessity but also good business sense. Already,we have anti-slavery legislation in the UK, France andthe Netherlands, with Australia soon to introduce its
own Act and more countries likely to follow.

6
7
8
9

2

Within the UK, investors are increasing their scrutinyof company action and there is growing pressure on
public procurement processes to embed anti-slavery
due diligence. This means government contracts could
soon be lost by companies failing to act. Whilst theModern Slavery Act’s section 54 only captures larger
companies, smaller businesses must pay heed or lose
contracts with those higher up the chain.
The construction sector must also remember thatthe risk of modern slavery is not solely within its
own labour force, but also within the supply chainsfor its raw materials and products. Addressing thisdual challenge is no small task but it can – andmust – be done. Businesses should be risk-mapping
their operations and supply chains, and dedicating
resources to identifying and remediating abuses.
I have said that this is a challenge. It is, but theconstruction sector has risen to complex challenges
before. Health and safety is a useful analogy: after
much effort within the industry, fatalities withinconstruction dropped to the lowest number on recordin 2017.9 This report should act as a spur to encourage
the same concerted effort on modern slavery. The UK
government has made the eradication of forced laboura priority, showing global leadership. It is time for
UK construction to step up and meet its challenges,
becoming a first class example of how slavery can,and must, be ended.

Kevin Hyland OBE
UK independent anti-slavery commissioner

Office for National Statistics, Construction Statistics: Number 18, 2017 edition, 2 October 2017
International Labour Organization and Walk Free Foundation, Global estimates of modern slavery: forced labour and forced marriage, 2017
Focus on Labour Exploitation, Public procurement: the government’s opportunity to lead on workers’ rights, 15 November 2017
HSE, HSE releases annual workplace fatality figures, 5 July 2017

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Introduction by Chris Blythe OBE
There’s a view from some quarters that modern slavery is not a serious problem
in UK construction. We disagree.

Construction is a highrisk industry. It has
similar challenges to foodproduction, agriculture andhospitality: widespread useof agency workers; a relianceon migrant labour; a large
proportion of the workforce
close to minimum wage.
We do not yet fully understand the extent towhich modern slavery and human trafficking are
affecting our sector, but a picture is emerging that is
uncomfortable to say the least.
Modern slavery should not be viewed in isolation.
It is at the extreme end of a spectrum of abusive
practices, from excessive working hours to payment
below minimum wage, intimidation and substandard
accommodation.
Our business models are normalising hardship, bothfor individuals and companies. And, whilst thesemodels do not always lead directly to modern slavery,
they are creating an environment in which it is easierfor exploitation to thrive and criminality to infiltrate
supply chains undetected.
The constant pressure on prices is forcing out ethicalplayers. Bogus self employment is eroding the rights ofBritish and foreign nationals. Abuse of the retentions
system and late payment are everyday occurrences.
Some SMEs complain that they struggle to pay wages
on time. It is small wonder that the sector has such an
abysmally high insolvency rate.
The response to the Modern Slavery Act has been,on the whole, lukewarm. Companies are publishingbrief, or watered down, transparency in supply chain
statements. There is a corporate fear of mentioning
risk, along with a default to compliance, box-ticking
exercises.

We have to remember that people’s lives and wellbeing
are at stake here. Aiming to do the legal minimum
demonstrates not only a lack of humanity, but chronic
corporate short-sightedness.
That this approach is being facilitated by professionals
is of even more serious concern. It brings into
question the notion of professionalism.
Our industry has clocked up some spectacularachievements. It has passionate and dedicated people who
naturally want to do the right thing, but are sometimes
disempowered by the system in which they operate.
That is why the CIOB is calling for a new approach.
As well as rebuilding our business models, we need tochange the narrative, having more open and honest
conversations about the challenges that we face. We
should be talking not just amongst ourselves, but withother sectors and, crucially, the media and NGOs.
There are some pockets of good and even excellent
practice. We need to share them more widely.
Organisations will not defeat slavery by acting alone.
We need to stand together, and to start making somedifficult choices.
We would like to thank the clients, contractors andsuppliers who participated in this report, generously
sharing what they have learnt so far. Thank you also
to the numerous charities, researchers, experts, publicbodies and other organisations that helped us see thebigger picture.
Finally, we would like to pay tribute to the latePaul Broadbent, the former chief executive of theGangmasters and Labour Abuse Authority, who
was interviewed for this report. Paul was a manof compassion and integrity, determined to tackle
exploitation in all its forms. He died unexpectedly
in 2017, but his legacy and vision continue.

Chris Blythe OBE
CIOB chief executive3

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Contents
Some definitions........................................................................................................................................................................... 1
Foreword by Kevin Hyland OBE................................................................................................................................................. 2
Introduction by Chris Blythe OBE............................................................................................................................................. 3
Executive Summary...................................................................................................................................................................... 8
The CIOB Routemap to Fair Business.................................................................................................................................... 12

CHAPTER 1 INTRODUCTION
Modern slavery in the UK......................................................................................................................................................... 14
Labour exploitation.................................................................................................................................................................... 14
Who are the victims?.................................................................................................................................................................. 15
Source countries.......................................................................................................................................................................... 15
British victims............................................................................................................................................................................. 15
How do people become vulnerable?........................................................................................................................................ 16
Who are the perpetrators?........................................................................................................................................................ 17
Why would traffickers target the UK?.................................................................................................................................... 17
Why big business is attractive to criminals.......................................................................................................................... 18
Damn lies and statistics............................................................................................................................................................. 18
But is it modern slavery?........................................................................................................................................................... 18
Right here right now: modern slavery in the UK ................................................................................................................. 20
INTERVIEW: The police view - Shaun Sawyer and Jeremy Capey..................................................................................... 20

CHAPTER 2: THE CONSTRUCTION BUSINESS MODEL AND LABOUR RIGHTS
Construction and informal working...................................................................................................................................... 23
Modern slavery in construction: recent stories..................................................................................................................... 24
Major projects: from poor practice to modern slavery......................................................................................................... 25
INTERVIEW: The legal view – Caroline Haughey QC......................................................................................................... 27
How construction’s business model is vulnerable to exploitation
Low risk and low detection rate........................................................................................................................................... 29
Heavy reliance on migrant labour....................................................................................................................................... 29
Outsourcing and cut price tendering ................................................................................................................................. 30
Retentions................................................................................................................................................................................ 30
Late, discounted and non-payment..................................................................................................................................... 30
Time constraints.................................................................................................................................................................... 31
The price of flexibility............................................................................................................................................................ 31
Bogus self employment and umbrella companies............................................................................................................. 31
Small clients and the decline of collective bargaining...................................................................................................... 33
Intimidation at home and abroad, and at all skill levels.................................................................................................. 33
Blacklisting ............................................................................................................................................................................. 34
Domestic clients..................................................................................................................................................................... 344

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

FUTURE RISKS........................................................................................................................................................34
Costs............................................................................................................................................................................. 34

Organised crime..................................................................................................................................................................... 35
Falling migration................................................................................................................................................................... 35
Racial abuse............................................................................................................................................................................. 35
CIOB VIEW: Creating a culture of fairness, inclusion and respect.................................................................................... 35
The GLAA targets construction............................................................................................................................................... 36
How the GLAA is changing................................................................................................................................................. 36
Working with the sector....................................................................................................................................................... 36
INTERVIEW: The GLAA view - Paul Broadbent........................................................................................................... 36
CIOB VIEW: Will labour licensing come to construction?................................................................................................ 38
Joining up the disciplines............................................................................................................................... 38
Learning from other sectors: food processing...................................................................................................................... 38“Criminal gangs keep evolving” - a factory manager’s story........................................................................................... 38
INTERVIEW: Independent anti-slavery commissioner Kevin Hyland OBE.................................................................... 39

CHAPTER 3 THE MODERN SLAVERY ACT: REQUIREMENTS AND REPORTING
Section 54: transparency in supply chains reporting......................................................................................................... 41
Government tightens guidance criteria................................................................................................................................. 41
First cycle reporting .................................................................................................................................................................. 41
Who is reporting?.................................................................................................................................................................. 42
How is construction performing?........................................................................................................................................ 42
Pan-industry issues................................................................................................................................................................ 43
CIOB VIEW: It’s time to become proactive............................................................................................................................ 44
Campaigning ramps up............................................................................................................................................................. 44
Will the Modern Slavery Act extend to the public sector?................................................................................................. 44
CIOB VIEW: Public procurement and construction............................................................................................................ 45
INTERVIEW: Legislation and the Modern Slavery Helpline - Justine Currell................................................................. 46

CHAPTER 4 CONSTRUCTION’S RESPONSE TO THE MODERN SLAVERY ACTWhat do construction companies think?.............................................................................................................................. 48
Comparatively poor reporting levels ..................................................................................................................................... 49
Sharp practice and compliance letters................................................................................................................................... 49
Training and awareness programmes.................................................................................................................................... 50
Risk mapping is underway, but will it translate into policy?............................................................................................ 51
Procurement reform gets off to a slow start.......................................................................................................................... 52
Crackdowns on illegal immigration continue, but are they missing slavery?............................................................... 52
Wage checks increase................................................................................................................................................................. 53
Enhanced site inspections and worker engagement............................................................................................................ 53
Hotlines and training programmes launch.......................................................................................................................... 54
Construction backs labour market enforcement................................................................................................................. 54
Cracks in the auditing process................................................................................................................................................. 55
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Construction and the Modern Slavery Act

Tackling Exploitation in the UK

CHAPTER 5 CHANGING THE MODEL
Modern slavery and reputation management....................................................................................................................... 57
Driven by fear......................................................................................................................................................................... 57
Opening Pandora’s box......................................................................................................................................................... 57
When a problem is uncovered, what then?........................................................................................................................ 58
CIOB VIEW: Changing the narrative..................................................................................................................................... 59
Learning from other sectors: manufacturing and retail.................................................................................................... 59
amfori: when buyers collaborate on remediation.............................................................................................................. 59
Fighting fake recruitment......................................................................................................................................................... 60
Construction scams............................................................................................................................................................... 61
Jobsites..................................................................................................................................................................................... 62
Fighting the fraudsters.......................................................................................................................................................... 62
How industry can help ......................................................................................................................................................... 62
CIOB VIEW: Collaborate for greater impact.......................................................................................................................... 62
Procurement ............................................................................................................................................................................... 63
Corporate policies and cognitive dissonance.................................................................................................................... 63
CASE STUDY: Profit with purpose: Skanska and its supply chains................................................................................... 64
Agencies........................................................................................................................................................................................ 64
Worker-centred supply chains................................................................................................................................................. 65
Learning from other sectors: fashion and footwear........................................................................................................... 65
Better Buying: the supplier rates the buyer ...................................................................................................................... 65
CIOB VIEW: Could the Better Buying model work in construction.................................................................................. 66

CHAPTER 6: DETECTION, SUPPORT AND REMEDIATION
Spotting the signs of exploitation........................................................................................................................................... 67
The slow road to recovery.......................................................................................................................................................... 67
Learning from other sectors: retail......................................................................................................................................... 68
The Co-op Group: helping victims of slavery back to work............................................................................................ 68
CIOB VIEW: Contributing to society...................................................................................................................................... 69
CASE STUDY: Be Onsite and marginalised workers........................................................................................................... 69

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Construction and the Modern Slavery Act

Tackling Exploitation in the UK

CHAPTER 7: REGIONAL GOVERNMENT
Wales............................................................................................................................................................................................. 70
Code of practice.......................................................................................................................................................................... 70
What the code demands of business....................................................................................................................................... 71
CIOB VIEW: Setting new standards........................................................................................................................................ 71
Northern Ireland........................................................................................................................................................................ 71
The Northern Irish border.................................................................................................................................................... 72
Scotland........................................................................................................................................................................................ 73
Public procurement............................................................................................................................................................... 73
The living wage and fair work.............................................................................................................................................. 73

CHAPTER 8: DRIVERS OF CHANGE
International legislation ........................................................................................................................................................... 74
UK multinationals and duty of care.................................................................................................................................... 74
Investors demand greater transparency................................................................................................................................ 75
The Corporate Human Rights Benchmark........................................................................................................................ 75
The Workforce Disclosure Initiative .................................................................................................................................. 75
CASE STUDY: Land Securities and the Workforce Disclosure Initiative.......................................................................... 76
New standards............................................................................................................................................................................. 77
BS ISO 20400 ........................................................................................................................................................................ 77
The Ethical Labour Sourcing standard............................................................................................................................... 77
CASE STUDY: Sir Robert McAlpine adopts the ELS............................................................................................................. 78
CASE STUDY: Mace and Sedex................................................................................................................................................ 80
Industry initiatives roundup.................................................................................................................................................... 82

CHAPTER 9: COMPANY CASE STUDIESGreat Portland Estates............................................................................................................................................................... 85
Lendlease...................................................................................................................................................................................... 86
Marshalls...................................................................................................................................................................................... 87
Skanska......................................................................................................................................................................................... 89
Wilson James............................................................................................................................................................................... 91

ACKNOWLEDGEMENTS............................................................................................................................................. 92

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Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Executive summary
This report examines the UK construction industry’s response to the Modern Slavery
Act and the systemic problems that are eroding the rights of domestic and foreign workers
in the sector.
Modern slavery is the most extreme example ofabusive practices that thrive within fragmented
supply chains and aggressive price-driven businessmodels. Whilst the construction sector has many risk
indicators of exploitation, the potential scale of the
problem in the UK is only just emerging.
The report also explores evolving best practice,industry initiatives and emerging legal, social andgovernance drivers of change.
Background
The International Labour Organization (ILO)
estimates that more than 40 million people are inmodern slavery globally, with 25 million in forced
labour. It is commonly assumed that most slavery isconcentrated in the developing countries. However,
exploitation is increasingly being detected in theworld’s richest nations.
In Europe, nearly three people in every thousand
are estimated to be victims of slavery. In the UK, theNational Crime Agency (NCA) is significantly revising
upwards its previous estimates of 13,000 modern
slavery victims.
Slavery is a hidden crime that is a lucrative
business model for organised criminals and casual
opportunists. A total of 5,145 potential victims were
submitted to the government’s official register ofslavery, the National Referral Mechanism (NRM) in2017. This was a 35% increase on the previous year.
Labour exploitation is the NRM’s fastest growing
category: 1,326 adults and 1,026 children wereregistered under that category last year.
Developed nations such as the UK make appealing
targets for exploiters because they can generate highincome levels per worker, estimated at US$34,800 ayear. Legitimate businesses are more profitable thanillegal operations because of higher wage levels.
Slavery has been found in every region of the UK. In
March 2018 , there were more than 600 live policing
operations on modern slavery, from major cities torural areas.
Although low skilled migrant workers are thought tobe most at risk of slavery or human trafficking, peopleof any nationality, educational background or income
level can be targeted. Many identified victims of forced

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labour have a legal right to work in the UK, and a highproportion are British. There is a strong link between
homelessness and forced labour.
Anyone caught in modern slavery has become
vulnerable at some point in his or her recruitment
process. Some may have inbuilt vulnerabilities suchas addictions, lack of education or inability to speak
English, others may be trapped into unsustainabledebt by extortionate recruitment fees. Even visas tied
to a single employer increase workers’ vulnerability to
exploitation.
Modern slavery and human trafficking are treated as
entrepreneurial activities by criminals who continually
evolve their operational models to evade detection andinfiltrate legitimate businesses.
In the past, lack of understanding from industry, police,
health workers, enforcement agencies and wider society
has led to a low detection rate of modern slavery cases,
but the UK Modern Slavery Act 2015 has led to a spikein education and training initiatives across the public
and private sector, and growing awareness from thegeneral public. Calls to the Modern Slavery Helpline are
predicted to rise to 6,000 in 2018.
Construction
In the European Union, construction ranks second
only to the sex industry as the sector most prone to
exploitation. In the UK, anti-slavery leaders havehighlighted construction as a priority area.
Recent media coverage of prosecution cases has
focused on traveller families, giving the impressionthat modern slavery is not infiltrating big business.
However, there is growing evidence of rogue operators
entering the formal economy around tiers four andfive of industry supply chains.
Varying levels of exploitation have been foundin public and private sector projects, including
power plants, hospitals, prisonsand major infrastructure
programmes.
As yet, there is a scarcity of data on
exploitation within construction,
not least because workers inforced labour are often switchedbetween sectors, locations andConstruction and the Modern Slavery Act

industries to avoid detection. Some obvious victims do
not identify themselves as such. Others are too frightened
to talk to the authorities or receive government support.
Organisations also have little visibility below the first andsecond tiers of their supply chains.
Modern slavery in construction should not be
considered in isolation, but in the context of exploitative
practices such as health and safety breaches, banning ofunions, blacklisting, illegal wage deductions, excessive
working hours, withholding of passports, bullying,
intimidation and squalid accommodation. Workers may
move in and out of slavery, and the level of abuse could
escalate, especially if perpetrators fear detection.
A number of systemic factors put construction workers
at risk of exploitation, including: business models basedon outsourcing (99% of the industry is made up ofSMEs); reliance on labour agencies; a high percentageof migrant workers (one in eight of the workforce wasborn outside of the UK); very low margins (some of the
UK’s top ten contractors are making less than 1% profit);a large proportion of the workforce close to minimum
wage; lack of labour standards enforcement in the sector.
The tone is being set at the top of supply chains as many
public and private sector clients create an environmentthat is pricing out legitimate players and facilitating
unethical operators. The race to the bottom in labour
standards is being forced by common industry practices
such as lowest cost tendering, project discounting,retentions and late or non-payment. SMEs are often
shouldering the financial and legal risks of larger
companies and suffer a higher bankruptcy rate thanother sectors.
The UK has the largest proportion of agency workers in
the whole of EU. In construction, unscrupulous labour
agencies are forcing many workers into spurious self
employment. Workers are not receiving their full wages,
their rights are being eroded and working conditions
undermined.
This is creating an imbalance of power on some sites.
Domestic and foreign workers complain of intimidation.
Informal blacklisting is thought be to continuing,
despite significant prosecutions in recent years.
Future risks
Analysts predict sharply rising costs of material andlabour. This is partly down to uncertainty following theBrexit vote and also to rising costs of essential materials.
Cost inflation may result in clients forcing even harsher
discounts on their supply chains, weakening the due
diligence processes for sourcing materials.
Following Brexit, the UK is already experiencing
falling migration levels through legitimate channels.

Tackling Exploitation in the UK

However, analysts predict a rise in organised criminal
involvement in trafficking across Europe. As a result, theUK has risen from low to medium risk as a trafficking
destination.
Depending on the outcome of Brexit negotiations,
thousands of Eastern European workers in the UK
may suddenly lose their legitimate right to work status,
becoming more vulnerable to exploitation.
An escalating labour shortage and skills crisis could
result in some contractors ignoring irregularities when
procuring labour, particularly when facing financial
penalties for project delays.
Modern Slavery Act reporting
Section 54 of the Modern Slavery Act (MSA) requires
all businesses with a turnover above £36 million to
publish an annual transparency in supply chains (TISC)
statement on the activities that they have carried out tocombat modern slavery internally and in their supply
chains.
Initial responses have been patchy and the government
has set out no clear penalties for non compliance.
Construction lags behind other industries in the qualityof disclosure and many companies are late publishingstatements. Reporting tends to focus on policies andrisk assessment rather than actions. Many reports failto meet basic requirements: they are not signed off
by directors, approved by the board or visible on thecompany website’s homepage.
There is evidence that many companies are watering
down their TISC statements by removing mentionof risk or even positive actions that have been taken.
This is driven by a fear of media exposés and concernsthat statements may be used as evidence in futureprosecutions.
However, as companies move into their second year of
TISC reporting, peer pressure is forcing an improvementin the reports of some organisations. The effects of
the MSA are also rippling beyond legal compliance:some non-UK based companies, as well as SMEs below
the £36 million threshold, are voluntarily producing
statements.
A campaign is ongoing to extend the Modern Slavery
Act to the public sector.
Industry response to the legislation
Some construction companies are showing a degreeof complacency and lack of understanding of modern
slavery issues. Although a number of organisations arebeing proactive, other contractors are in denial that thesector has a problem.

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Construction and the Modern Slavery Act

Tackling Exploitation in the UK

In a recent CIPS survey, 58% of construction
procurement managers were fairly or very confident
that they did not have modern slavery in their supply
chains. It is highly improbable that they are correct.
Industry overconfidence might be down to thecommon misconception that immigration – or rightto work checks – will also detect modern slavery.
The conflation of anti-slavery measures withimmigration checks is a concern, particularly as
Eastern Europeans, and other nationals that have alegitimate right to work, account for a large sectionof known forced labour in the UK.
The sector has made good progress with training andawareness programmes as major contractors try toreach further into their supply chains. Many are using
resources and materials from the industry-backed
Supply Chain Sustainability School, and some havesigned up for industry toolkit Stronger Together.
But construction still lags behind other sectors onawareness training.
Some companies have started to map out risk andstarted looking at product journeys but are at thevery early stages.
As a negative consequence of the MSA, some major
companies are defaulting to compliance activities.
They are shifting legal responsibility onto theirless well resourced suppliers and threatening
instant contract termination if problems are found.
A draconian zero tolerance approach could be
convenient to criminals, enabling them to relocate
to other businesses without detection.
Auditing is important for benchmarking andraising standards but evidence shows that it is not areliable method for detecting slavery. Research has
found systemic failings in domestic auditing, withcommercial disincentives for auditors to find or reportproblems found on UK construction sites.
In a recent survey, 61% construction procurement
managers backed tougher enforcement legislation,with 69% believing that this would help combat
modern slavery.
Drivers of change
New laws to fight trafficking and exploitation arebeing introduced or proposed in many countries.
Prosecutions of modern slavery in the UK are on therise. Lawyers are also considering the possibility ofprosecuting UK-based companies in British courtsfor human rights violations carried out abroad.
Investors are increasingly calling for better
environmental, social and governance criteria to be
used for assessing companies. Pressure is growing for

10

greater transparency in reporting. Initiatives, such as
ShareAction’s Workforce Disclosure Initiative, will
increasingly force major organisations to demonstratethat their supply chain policies are effective.
Changing the business model
Modern slavery is complex to tackle because it
is intertwined with criminality and hidden infragmented supply chains.
Independent anti-slavery commissioner Kevin Hyland
acknowledges that it will take time for industry
to change and is encouraging businesses to take astrategic and incremental approach. Along with thepolice, enforcement agencies and NGOs, Hyland will
be looking for evidence that companies are taking
meaningful and sustainable steps towards continual
improvement.
A range of initiatives are underway to increase
effectiveness in the battle against exploitation.
These include:
Procurement: A focus on ethical procurement
practices, with companies taking a more
holistic and less financially focused approach toprocurement.
Industry can learn from initiatives in other sectors
where suppliers are rating the performance ofbuyers, giving voice to disempowered companies
at the end of supply chains.
Reputation management: There is a needfor greater openness in discussing supply chain
challenges. The Co-op Group and materials
company Marshalls are two companies that areleading the way in disclosing risks and trying
to start conversations with industry and thegeneral public.
Cross disciplinary collaboration: Networks
for information sharing between the police,agencies, local authorities and businesses
are being established. Initiatives include theGangmasters and Labour Abuse Authority’s(GLAA) construction protocol, which paves theway for regular meetings with industry. Local
and regional initiatives are also being piloted,
including in West Yorkshire and the East
Midlands.
Labour standards: GLAA is working
with industry to drive up labour standards,
including tackling bogus self employment,
as well as fighting slavery. The Association ofLabour Providers (ALP) is launching Clear
View, a voluntary labour standards certification
programme. Contractors should prepareConstruction and the Modern Slavery Act

Tackling Exploitation in the UKthemselves for the possibility of labour licensing
in the future. At the very least, they will comeunder increasing pressure to comply withvoluntary initiatives.
Fake recruitment: Jobsites or social media
platforms such as LinkedIn are easily infiltrated
by scammers and fraudulent outfits. Qualified
professionals make the most lucrative
targets, and the identities of big brands arealso hijacked. Fake recruitment affects both
British and foreign nationals. There is a needfor industry to get behind awareness-raisingawareness campaigns at home and abroad andengage with initiatives such as SAFERjobs.
Rehabilitation: Survivors of slavery are often
highly traumatised and malnourished, andcan take months or years to recover from theirordeal. An important part of their recovery canbe getting them into normal work. The Co-op
Bright Future project is helping survivors into
employment. Construction organisations are
exploring how they can support this scheme.
Organisations should also put policies inplace for considering how to support andoffer remediation to modern slavery victims
discovered within their supply chains.
Supply chains support: In order to raise
standards, it is important that clients and tierone organisations actively engage with supply
chains, supporting continual improvement.
They should encourage an atmosphere of
openness in which systemic weaknesses andsourcing problems can be discussed without
fear of reprisals.
Frameworks and platforms: Somecompanies are aligning their business
operations with international ethical standards
and frameworks that support continual
improvement. Examples include ISO 20400 and
BRE’s Ethical Labour Standard.
Devolved government responses: Regional
initiatives to tackle exploitation and raise labour
standards are ongoing. The Welsh government
has launched an ethical code of practice forpublic sector supply chain procurement.
Tenders will reflect a requirement to commit toethical working practices. Northern Ireland set
up a Modern Slavery and Human Trafficking
Unit in 2015, providing a centralised andstandard approach to any modern slavery
referrals across the province; Scotland isalso championing the living wage and fairprocurement practices.

Conclusion
There is little doubt that UK construction supply
chains are at risk of being infiltrated by criminal
activities such as modern slavery. This is in line withmany other sectors, including agriculture, foodprocessing, manufacturing and hospitality. Changing
the narrative to acceptance, rather than denial of risks,
will open up conversations and create opportunities
for innovation.
But companies cannot tackle these systemic challenges
alone. Knowledge sharing and collaboration will beessential for developing tools and best practice. And
no initiative will be sustainable without the genuine
commitment of senior management.
Adopting decent work principles will help to curb
exploitative practices. It is hoped that labour standards
will follow a similar trajectory to health and safety,
which has seen a marked improvement in theindustry over the past two decades. Organisations
demonstrating leadership in this area will make theirbusinesses more resilient.

11

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

THE CIOB ROUTEMAPTO FAIR BUSINESS
Change the narrative• Acknowledge the inherent risks of exploitation in all supply chains• Shift the conversation to how the risks are managed• Engage with the general public, clients, suppliers and governments• Publicise the effects of anti-slavery initiatives

Lead and commit• Lead on anti-slavery initiatives at senior board level• Embed policy into procurement and daily operations• Empower employees to find and fix problems• Set standards and expectations at the outset of a project

Train and educate• Train all employees to spot the signs of slavery• Appoint anti-slavery ambassadors in strategic departmental roles• Educate the workforce of their rights and employment law• Encourage more open conversations with suppliers

Act with fairness• Commit to the living wage for temporary and permanent workers• Encourage direct employment over agency labour• Eliminate worker recruitment fees – the employer pays the costs• Fully understand the supply chains for materials, labour and services• Set realistic prices

Map out risk
• Identify the risk areas and activities most at risk of criminal infiltration• Build a wider picture of countries, migration routes and economic trends• Link this understanding with corporate strategy

12Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Investigate and find
• Protect and strengthen the audit process to include modern
slavery investigations• Seek evidence that suppliers are taking appropriate actions• Reward proactive suppliers that are working to minimise risk

Declare• Create an annual modern slavery statement – whatever size of business• Use it to reflect the corporate journey and long term goals• Sign up to UN Sustainable Development Goals and other initiatives

Collaborate• Join multi-disciplinary groups of industry, NGOs, agency
and law enforcement• Exchange intelligence at a local, regional and national level• Work with peers to stamp out fake recruitment• Collaborate with competitors to influence common suppliers• Work with unions

Evolve• Evolve new methods of detection and prevention to keep pacewith criminality• Build on activities year on year
• Question progress. Be prepared to discard what is not working

Be proactive• Ensure that there is a robust infrastructure for dealing with incidences• Report problems to the GLAA, Modern Slavery Helpline and the police• Have a remediation strategy for survivors of modern slavery• Commit to putting right where corporate wrongdoing is discovered

13

Construction and the Modern Slavery Act

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INTRODUCTION
Modern slavery in the UK

Despite centuries of campaigns, legislation and treaties, society has never managed toconquer slavery.
The International Labour Organization (ILO) estimates that there were more than 40 million
adult victims of slavery in 2016. More than half – 25 million – were in forced labour.10
In addition, 152 million children between ages 5 and 17 are believed to be in child labouraround the world.11
This figure is higher than at any time in history andis not confined to developing countries. The 2016
Global Slavery Index estimated there were 1,243,400
people in modern slavery in Europe , which is 2.7% of
the region’s total population.12
In the UK, the Modern Slavery Act 2015 has
accelerated awareness among businesses, government
agencies and the police. But the scale of the problem isonly just emerging.
In 2014, the National Crime Agency (NCA) estimatedthat there were between 10,000 and 13,000 victims
of modern slavery in the UK. By summer 2017,
the agency was speculating that the real figure wasconsiderably higher.
Will Kerr, the NCA’s director of vulnerabilities said:“The more that we look for modern slavery the more wefind the evidence of the widespread abuse of vulnerable.
The growing body of evidence.....points to the scale
being far larger than anyone had previously thought.”
Slavery is a complex and hidden crime that feeds off
vulnerable people and a voracious demand for cheap
labour. Within industry, it thrives in conditions ofopportunism, greed, poor governance and ignorance.
For years many incidents of modern slavery were missed
or passed over, due to systemic lack of understanding
from the police, immigration officials, health and social
workers and businesses. Now, the Modern Slavery Act isforcing the public and private sector to take a closer look.
A total of 5,145 potential victims were submitted to the
National Referral Mechanism (NRM), the government’s
official register of modern slavery, in 2017. This was a 35%
increase on the previous year.
10
11
12
13
14
15
16
17

14

In March 2018, the NCA reported that there were morethan 600 live policing operations targeting modern
slavery in the UK.13 In a recent study, one in eight NHS
professionals reported having been in contact with apatient they knew or suspected was trafficked.14 The
UK Government recognises that the proceeds of labour
exploitation have become one of the most significant
money laundering threats in this country.15
Kevin Hyland, the UK’s first independent anti-slavery
commissioner says:“We need modern slavery to become socially
unacceptable, like we saw with drink driving anddomestic violence. There isn’t an overnight fix. Whenevery part of the UK thinks that this cannot betolerated any longer, then we will see a change
in culture.”16

Labour exploitation“A conservative estimate is that we havein excess of 30,000 people in modern
slavery in the UK. Everyone in the UK,
every business is in some way complicit inmodern slavery existing, because societylets it exist.”
Paul Gerrard, group policy and campaigns director,
the Co-op GroupLabour exploitation is the fastest growing category ofreferrals to the NRM. In 2017, a total of 1,326 adults and1,026 children entered the register in this category.17

ILO and Walk Free Foundation, Global Estimates of Modern Slavery: Forced Labour and Forced Marriage, 2017
ILO, Global Estimates of Child Labour, results and trends, 2012 – 2016, 2017
The Global Slavery Index, www.globalslaveryindex.org/region/europe, 2016
NCA, National Referral Mechanism Annual Summary 2017, March 2018
King’s College London Human Trafficking: improving the UK’s health care response, March 2017
Home Office & HM Treasury, Action Plan for anti-money laundering and counter-terrorist finance, April 2016
Reuters, Britain needs ‘change in culture’ to stamp out modern slavery, 20 December 2017
NCA, National Referral Mechanism Statistics – End of Year Summary 2017, March 2018

Construction and the Modern Slavery Act

Because the NRM only records cases that havesuccessfully come through the multi-agency reporting
process, the statistics paint a partial picture of a crimethat is known to be far more widespread.
Sectors requiring large numbers of temporary or low
skilled workers are most at risk of modern slavery. This
includes agriculture, manufacturing and hospitality
and construction. Exploitation is also common in lessformal sectors including illegal cannabis cultivation,
car washes, nail bars and the sex trade.

Who are the victims?

“It is highly likely that the actual scaleof modern slavery across victim andoffender numbers, as well as incidence
rates, has increased year-on-year.
Analysis of drivers suggests this trend
is likely to continue.”18
There is a belief that modern slavery victims in the
UK are low skilled, illegal immigrants, with poor
educational levels and poor English skills.
This is only partly true. Many victims are EU
or Commonwealth citizens with full working
rights. Some are highly qualified and were evenprosperous in their home countries. A highproportion are British.
One thing that victims have in common is that they
were vulnerable or became vulnerable at some pointin their recruitment.
Some foreign workers may have been tricked or
coerced into paying extortionate recruitment fees.
They may have raised expensive loans and becometrapped in debt to their handlers or loan sharks
in their home countries. This problem is well
documented in regions such as the Gulf,19 but isalso believed to be widespread in the UK.20 Illegal
recruitment fees should be viewed as a significant
risk indicator of exploitation wherever they occur
in the world.
Emilie Martin, operations manager for The Salvation
Army’s anti trafficking and modern slavery unit says:

18
19
20
21

Tackling Exploitation in the UK“I’ve worked with people from all backgrounds,
nationalities and education levels. In one case I met a
successful Indian businessman who paid the equivalentof £90,000 to traffickers, believing that he was buying
into a British company. He was held as a slave for 15
years, and was only discovered by chance during an
unrelated raid on the property where he was working.
“I’ve also worked with engineers, architects, lawyers,
economists, pastry chefs, doctors and surgeons. All
were victims of trafficking and were often tricked byfraudsters or fake recruitment advertisements.”

Source countries
In 2017, victims of modern slavery and human trafficking
in the UK were identified from 116 different countries.
For the first time, British citizens were the largest
recorded nationality on the NRM, up from 326 in 2016
to 819 in 2017. This was largely down to an increase inminors involved in drug trafficking or sex exploitation.
Within the adult labour exploitation category,
Vietnam, Romania, China and the UK were the
top source countries, but several Eastern European
nations- a major source of recruitment for the UK
construction sector - were also high on the list. 21

British victims
In cases of British nationals trapped in forced labour,
many have underlying problems such as financial
debt, learning difficulties, gambling or addictions.
Traffickers will often groom victims to increase theirvulnerabilities.
There is a strong link between homelessness andforced labour: homeless people are particularly
vulnerable as they are already cut off from society,friends and family.
“We’re raising awareness in soup kitchens and shelters.
People in white vans will turn up and offer people jobs
and accommodation. They disappear and are neverseen again,” says The Salvation Army’s Emilie Martin.
In a disturbing parallel trend, many modern slavery
survivors that do not receive adequate support
could be tempted to return to their abusers to avoid
homelessness. The vicious cycle can be difficult to break.

NCA, National Strategic Assessment of Serious and Organised Crime, 2017
CIOB, Building a Fairer System, tackling modern slavery in construction supply chains, July 2016
Joseph Rowntree Foundation, Forced Labour in the United Kingdom, June 2014
NCA, National Referral Mechanism Annual Summary 2017, March 201815

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

The top countries for labour exploitation in the UK 22
Claimednationality

Labour exploitationreferrals to the National Referral Mechanism in 2017

Vietnam 254
Romania 157
China 117
United Kingdom 92
India 85
Albania 80
Poland 79
Sudan 73
Slovakia 34
Eritrea 32
Pakistan 28
Latvia 26
Hungary 24
Bangladesh 22
Lithuania 20
Ethiopia 18
Nigeria 17
Czech Republic 16
Ghana 15Iraq
9
Afghanistan
9
Myanmar
9

0

50

100

There have been incidents of loan sharks forcing
heavily indebted people into criminality, particularly
with drug-related crime. The England Illegal Money
Lending Team is now investigating possible links
between loan sharks and forced labour.
Tony Quigley, head of the Illegal Money Lending
Team in England says:“Loan sharks operate across all
communities; these criminals prey uponvulnerable individuals who are struggling
financially... borrowers can sometimes
find themselves working for the loan sharkin order to pay off a debt.”23

22
23

16

150

200

250

300

How do people become vulnerable?
A combination of factors from personal circumstances
to crime, debt and immigration status creates
vulnerability in workers.
For some workers, there can even be a simple
misunderstanding of rights: some newly arrived
migrants consider arduous working conditions aninevitable first step on coming to the UK. Other
factors include having poor English skills or a visa
tied to a single employer.

NCA, National Referral Mechanism Statistics - End of Year Summary 2017, March 2018
For more information see www.stoploansharks.co.uk or call the 24/7 confidential hotline on 0300 555 2222

Construction and the Modern Slavery Act£

Poor English skills
Fear ofdeportation£
The need to send money tosupport relatives back home

Inbuilt vulnerabilities,
such as homelessness
or addictions

Being trapped
in debt

Conditionsforvulnerability

Fear of the authorities

Who are the perpetrators?
Across Europe, the majority of criminals involvedin human trafficking are EU nationals. The mostcommon nationalities for traffickers based in the UK
are British and Romanian.24
Foreign nationals tend to exploit people from theirhome countries, or those with whom they sharelinguistic or ethnic ties. Links back to their homelandprovide opportunities not only for recruitment, butalso a means of controlling victims, who may fear
repercussions on their families if they step out of line.
British traffickers have a more diverse victim base. As
well as buying foreign victims from other groups, theyalso target vulnerable nationals, such as the homeless.
The NCA identifies the majority of modern slavery
crime groups in this country as “small with limited
hierarchies,” but adds “there is a realistic possibility
that a smaller number of larger more structured crimegroups are also involved with modern slavery andhuman trafficking in the UK”.
Criminality ranges from the simple to sophisticated.
The Gangmasters and Labour Abuse Authority(GLAA) broadly divides activity into four tiers:
The casual chancer for example, an informal labour
provider who carries out low level exploitation such as
not paying holiday pay, or disappears without paying
wages.

24
25
26
27

Tackling Exploitation in the UK

Work visas that are tied
to a single employer

Intimidation, threatsof violence against victims
or their families

The legitimate business where the employment
model relies on extended family, acquaintances andfriends working for very low pay.
The horse trader this is the intermediary who
recruits workers –commonly referred to as “horses”- from other countries. Workers are under thecontrol of their exploiter: trapped in debt, with little
or no language skills, having handed over identity
documents and passports.25
The organised criminal The GLAA says that thelargest and most sophisticated criminal gangs haveforced labour as part of their business models, andare being copied by smaller gangs.

Why would traffickers target the UK?

“Forced Labour will only be used when
it makes business sense to do so”26
Although modern slavery is considered to be moreprevalent for poorer nations, advanced economies
provide lucrative incentives for traffickers. In Africa,
the ILO estimates that a trafficked person may
generate US$3,900 in profits. In the Asia Pacific region,
the annual profit per victim is $5,000. But in wealthiernations, each victim could generate $34,800 a year.27
The cost of humans as commodities has plunged inrecent times. Mark Heath, head of business change

NCA, National Strategic Assessment of Serious and Organised Crime, 2017
See the GLAA’s Horse Trading video
Joseph Rowntree Foundation, Forced Labour’s business Models and Supply Chains, November 2013
ILO, Costs of Coercion, May 200917

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

and development at the GLAA says: “In the UK, we’veseen workers bought and sold for as little as £250.”
Chief constable Shaun Sawyer, national policing leadfor modern slavery adds: “We regularly hear stories ofslaves being traded...sometimes not even for money.
They could be sold for a crate of wine or whatevertakes their fancy at that time... the supply, handoverand changeover of slaves is so quick, criminals putvery little value on individual lives.”28

Why big business is attractive to traffickers“You can traffic a kilo of heroin only once.
You can traffic people countless times andthere are entrepreneurs up at the top thatare doing this.”29
Paul Broadbent, former CEO, GLAA
From news reports it would be easy to dismiss slavery
as happening mostly in nail bars, car washes andillegal activities such as cannabis farming.
Former police protection officer Gary Booth is now
team leader at anti-slavery charity Hope for Justice.
He warns businesses against complacency.
“Over the past two years, we’ve taken more than 200
victims out of modern slavery. The vast majority
were in mainstream businesses. Why? Because theorganised crime gangs are always looking at whatvalue they can earn from a trafficked person. Theircommodity – the human - will earn them money
this way.”
For example, a forced labourer may generate £1
an hour working in a carwash, but could get theminimum wage hourly rate of £7.50 in legitimate
employment.

A 2014 PwC report on bribery and corruption foundthat 76% of respondents in the construction andengineering sector had suffered serious asset theft.
This was the highest proportion of any industry
surveyed.30 A survey by insurer Allianz Cornhill foundthat the equivalent of £70 million had been stolen fromUK construction sites in 2015.31

Damn lies and statistics“Forced labour is so insidious because it
can be invisible. At first sight, it can often
look like ordinary work”
Kevin Hyland, independent anti-slavery
commissioner32
It is difficult to gauge the extent of modern slavery
in construction, as official statistics for forced labour
cover all industrial sectors and some criminal activity.
Traffickers like to move their victims around. If theysuspect that the authorities are showing interest in acertain building site, they will shuffle their workers
onto different projects.
To evade detection, workers may also be swapped into
different sectors: from an infrastructure project inBirmingham, to a factory in Yorkshire then a farm inCornwall. They could also be traded between criminal
gangs operating in different regions.
There are also many cases of victims being forced into
different forms of exploitation simultaneously.
“Some of the men in our safe houses have beensexually exploited – used for “entertainment” by the
traffickers at night, while labouring on building sites
during the day,” says The Salvation Army’s Emilie
Martin.

“We’ve seen organised crime groups target unwitting
businesses – those that aren’t really aware of modern
slavery, don’t fully understand it, and are therefore
blind to the threat,” Booth says.

But is it modern slavery?

The GLAA’s Mark Heath warns that organised gangs
are using human trafficking as the gateway to othertypes of crime such as theft of goods or plant.

Modern slavery is at the extreme end of a spectrum
that stretches from decent work to minimum legal
compliance, then substandard, unscrupulous,
unethical, non-compliant and illegal practices.33

28
29
30
31
32
33

18

People commonly ask whether a situation ‘is reallyslavery?’ The answer is not always a binary yes or no.

See Police View interview
Presentation at the Association of Labour Providers Roadshow, London, March 2013
PwC, Fighting Bribery and Corruption in the construction industry, 2014
The Global Initiative Against Transnational Organized Crime, Transnational Organized Crime and the Impact on the Private Sector: The Hidden
Battalions, December 2017
The Guardian, A slave in Scotland – I fell into a trap - and I couldn’t get out, 28 May 2016
Joseph Rowntree Foundation, Forced Labour in the United Kingdom, 2014

Construction and the Modern Slavery Act

The line between legitimate work and slavery is often
fluid: victims may not be technically ‘in’ slavery all thetime and the extent of exploitation in each situation
could vary.
“The situation is very informal and switches fromindustry to industry. Sometimes people suffer minor
exploitation, sometimes it crosses the line to a moreforced labour situation, but it can change from week
to week,” says Andrew Crane, professor of businessand society at the University of Bath’s School ofManagement.
But conditions can gradually worsen, and researchers
have detected a range of employer behaviours thatengineer vulnerability in the workforce.34

Poor healthand safety

This includes: disciplining workers through dismissal,or threatening to do so; punishing people for refusing
to work overtime or if they become ill; using intrusive
surveillance and setting unrealistic production targets.
Employers could also retain wages ‘for safe keeping’.
Exploitative practices are not confined to small
companies. FTSE 100 company Sports Direct wasrecently found to be fining workers 15 minutes of pay
if they clocked in a minute late, despite long queues toclear security.
Unite the union’s Luke Primarolo described theculture of fear among Sport Direct’s 3,000 agency
workers: “People are scared because they are working
under a system when they know they could lose theiremployment at any moment.”35

Bullying
Illegal deductions
for equipment
or clothing

Forced labour

False imprisonment

Withholding
passports

DiscriminationTHE
EXPLOITATION
SPECTRUM

Excessive
working hours

Payment below
minimum wage

Non
payment

Latepayment
Violence andintimidation

34
35

Tackling Exploitation in the UK

Unsanitaryand cramped
living conditions

Breach ofcontract

Joseph Rowntree Foundation, Forced Labour in the United Kingdom, 2014
The Guardian, Mike Ashley admits Sports Direct staff were not paid minimum wage, 7 June 201619

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Right here, right now. Slavery stories from the UK
Maritime and oil
Fifteen Indian sailors staged a seven-month protest on their ship in Great Yarmouth, claiming that they had
not been paid for months for their work in the North Sea oil fields. Despite operating in British waters, theworkers were receiving less than minimum wage, some receiving as little as £2.43 an hour.”36
Consumer goods
Mohammed Rafiq was sentenced to 27 months in prison in 2016. Rafiq employed large numbers of
Hungarians as a slave workforce at his Kozee Sleep bed-making factory in West Yorkshire. Workers endured
10 – 16 hour days on £10 a week, lived in squalid conditions and were subjected to regular beatings.37 Ethicalaudits by high street retailers had failed to detect exploitation.38
Transport
Eastern European truck drivers working for Ikea were being paid considerably less than their Western
European counterparts. The drivers were earning less than £3 an hour and were forced to sleep for months intheir cabs. The BBC said that mistreatment of drivers was ‘widespread’ in the supply chains of “several otherbig, household names.”39
Logistics
In January 2017, brothers Erwin and Krystian Markowski were jailed for trafficking 18 Polish men into the
UK to work for Sports Direct. The pair targeted vulnerable men, withheld victims’ passports and controlled
their bank accounts, stealing £35,000 in wages.40

INTERVIEW: The police view
Shaun Sawyer is chief constable for Devon and Cornwall Police. He became national policing lead for modern
slavery, organised immigration crime and migration-related issues in 2013.
Jeremy Capey is detective superintendent with Devon and Cornwall Police and operational lead of themodern slavery police transformation unit - a 60-strong national team, bringing together intelligence, coordinationand policy.
How is the police’s approach to modern slavery changing?
Shaun Sawyer (SS): Three years ago, humantrafficking wasn’t really on the radar of
British policing. It was generally dealt with byimmigration officials. Now it’s on a par withchild sexual exploitation and increasingly partof everyday intelligence briefings, operations
and local partnership working.

36
37
38
39
40

20

People now understand that somebody could becomplicit in getting themselves smuggled into theUK, then be engaged in debt bondage or forced
labour. So their status can quickly turn from
offender to victim. The Modern Slavery Act has
been cleverly crafted to try to deal with that.

The Observer, Indian sailors stranded in Norfolk port by ‘modern-day slavery’, 22 January 2017
Huddersfield Daily Examiner, Slave workforce: Kozee Sleep bed factory owner Mohammed Rafiq jailed for people trafficking after forcing Hungarians to livein squalor and work 80 hour weeks for £10, 12 February 2016
BBC, Next, John Lewis and Dunelm Mill failed to spot ‘slaves’ at Kozee Sleep factory, 8 October 2015
BBC, Ikea drivers living in trucks for months, 15 March 2017
The Guardian, Tens of thousands of modern slavery victims in UK, 10 August 2017

Construction and the Modern Slavery Act

How is frontline policing adapting?
Jeremy Capey (JC): We now have a national
policing analytical team focusing on humantrafficking and modern slavery. There’s a modern
slavery coordinator in every region, offering advice
to investigators and ensuring that our approach isconsistent across the UK. We’re really pushing theoperational end to ensure that we are more effective
at identifying and rescuing victims and bringing
perpetrators to justice.
We’re also part of a multi-agency approachcoordinated through the National Crime
Agency. We’re looking at developing ourdomestic and international response which
includes strengthening our intelligence links
with international partners through Europol
and Interpol.
How are you developing awareness within
the ranks?
JC: We’re developing and delivering a number oftraining products to build expertise, including
courses on the best ways to gather evidence. We
also have a programme to deliver awarenessraising events across the country and we’re
publishing a growing library of best practiceguides.
SS: It’s still a challenge for frontline and senior
officers - as well as our local government partners
who have also actively engaged in developing theircapability to manage potential victims.
It’s the 3am test when you’re confronted with alorry load of people. Determining who is complicit
and who is exploited is extremely difficult - as well
as working out where we will home and look after
them during this critical assessment phase.
Where are you finding problems?
JC: The more we look for it the more we find. There
are 43 separate police forces in England and Wales.
Every single force is dealing with live modern
slavery cases, from remote rural areas to big cities.
Our labour exploitation cases cover a diverse
range of employment where low paid labour exists,
including construction.

Tackling Exploitation in the UK

What has been your experience of labour
exploitation so far?
SS: At the beginning of our journey, ourunderstanding of human trafficking centred
on foreign nationals forced into prostitution.
Now we’re realising that labour exploitation isa significant issue.
It varies widely. There are the people who are being
paid less than the minimum wage, but don’t want
us to intervene, because it’s still better than theirsituation back home.
In the most extreme cases, people are working
ridiculous hours, getting beaten, barely eating andliterally at point of death. I’m not exaggerating:
we’ve found a number of victims that were
emaciated and suffering horrendous illnesses after
years of exploitation. Whilst this is the exception
not the rule, it’s shocking that even one suchoccurrence can take place within our communities.
The number of UK nationals that are perpetratorsof modern slavery, and also the number of victims
that are UK nationals, is of great concern.
When would you take action against
a company?
JC: Our priority is not to go for legitimate
employers that have been duped by criminals.
However, three years into this new legislation, if
they have been negligent and not even bothered
to understand the implications and subtletiesof this act, if they don’t have a modicum of self
awareness, we and the GLAA may take a viewof filing for prosecution.
SS: This goes beyond human trafficking, it’s
about corporate responsibility. We’ll be looking
more closely at employment terms and working
conditions. In some high profile media cases
workers have been taxed for using the toilet,
having their wages docked for clocking in aminute late. That kind of intimidation is closeenough for us to consider filing the case with the
Crown. It’s a bit like corporate manslaughter.
There comes a point at which the board needs to
explain its corporate and personal involvementin preventing breaches of the act, or, potentially,
be considered wilfully blind.

21

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

How do you deal with people who areclearly victims, but too frightened tocooperate with the authorities?
JC: Our remit around modern slavery is not justabout law enforcement. A lot of NGOs will pickup victims at this point. They’ll support themover the longer term, exploring whether they
are able to help with the investigation at any
stage. But it’s quite complex.
In the most serious cases, victims are terrified
not just for themselves but of threats against
their families. It’s difficult for us to run
victimless prosecutions, but it's something we’redeveloping. We’ve already had some successful
victimless prosecutions from which we aredeveloping best practice.
Is organised crime behind most of themodern slavery cases that you deal with?
JC: There are cases where it’s opportunistic, but
the vast majority tends to be organised in someway. There are different levels of sophistication,
sometimes with an international footprint. It’s
not uncommon for criminal gangs to work
across multiple areas of criminality.
SS: Very regularly we’ll hear stories of slaves
being sold between gangs. And this is one of the
tragic stories - some of them aren’t even sold formoney. They could be sold for a crate of wine orwhatever takes their fancy at that time.
Unfortunately, the supply, handover andchangeover of slaves is so quick, criminals putvery little value on individual lives and treat
them appallingly.
What are your predictions for the future?
SS: The numbers of prosecutions and victims
will continue to rise. I also hope that there willbe less criticism of police and agencies. We
will be demonstrating that we are leading thisarea across policing, raising awareness levels
and developing greater expertise in bringing
perpetrators to justice.
JC: There is an increasing focus on safeguarding
and vulnerability. Work is ongoing tostrengthen the National Referral Mechanism, toensure that all victims are protected and havethe chance of investigation.

22

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

CHAPTER 2: THE CONSTRUCTION BUSINESS MODEL AND
LABOUR RIGHTS
Modern slavery generates $150 billion globally every year, according to the ILO. More than
20% - US$34 billion - of total proceeds come from the construction, manufacturing, mining
and utilities industries. The four sectors also account for around half of the world’s forced
labour population.41
In the European Union, construction ranks second
only to the sex industry as a sector most prone to
exploitation. Construction was ranked as the sector
at highest risk of labour exploitation in nine out of 21
European countries.42

Construction and informal working“Forced labour is principally an issue of
exploitation, supply chain management
and business operations – intersectingwith the vulnerabilities of individual
workers” 43
The Joseph Rowntree Foundation
If the entire European construction sector isvulnerable to exploitation, it is hard to dispute that the
UK also shares these risks: modern slavery transcends
borders; the sector attracts large numbers of workers
from Eastern Europe, a region already identified as amajor source of trafficked labour into the UK.
Leading anti-slavery figures, including independentanti-slavery commissioner Kevin Hyland and thelate GLAA CEO Paul Broadbent, have singled out
construction as a priority sector. London mayor Sadiq
Khan recently announced initiatives to tackle humanrights crimes on building sites in the nation’s capital.44
But the true extent of the problem is still a matter for
speculation. The sector has many risk factors, but thedata that journalists, industry leaders and NGOs areasking for does not yet exist.

41
42
43
44
45
46
47

Recent news stories give the impression that
exploitation in the sector is limited to informal jobs
and traveller families. But there is growing evidence
that non-legitimate businesses are targeting major
supply chains, particularly around tiers four and five,
where the informal and formal economies intersect.45
The GLAA’s Mark Heath believes that criminals are
systematically targeting legitimate labour agencies
adding, “Some high street recruitment firms haveaccepted that they have been infiltrated in this way.”
Projects are most at risk when they are falling behindschedule, or stringent cost cutting measures are
introduced. And, while much informal working
complies with UK law, researchers warn that sucharrangements should be regarded as risk indicatorsas ‘informality is a necessary condition for forced
labour’.46
Informal arrangements can be temporary or longterm. They could involve rogue employees ‘helping
out’ bosses by recruiting temporary workers andcontrolling their wages. They could be foreign gangs
exploiting ethnic groups from their country or regionof origin. Equally they could be the people whopick up workers from the side of a road early in themorning in vans.
Constant turnover of staff, a mobile workforce andthe temporary nature of projects, make construction
sites an easy target both for small time opportunistic
criminals and serious organised gangs.47

Human Rights First, Human Trafficking by Numbers, January 2016
European Union Agency for Fundamental Rights, Severe Labour Exploitation: workers moving within or into the European Union, 2015
Joseph Rowntree Foundation, Forced Labour in the United Kingdom, 2014
Evening Standard, Sadiq Khan backs Evening Standard’s modern slavery campaign amid crackdown on building site exploitation,2 November 2017
Joseph Rowntree Foundation, Forced Labour’s business Models and Supply Chains, November 2013
Joseph Rowntree Foundation, Forced Labour’s business Models and Supply Chains, November 2013
CIOB, Crime in the Construction Industry, July 200923

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Risk factors for UK construction supply chains
Pressure on costs
and schedules

Variability inlabour demand

Widespread use of agency
and subcontracted labour
Industry relianceon self regulation

A high concentrationof migrant labour
A large proportion of workat minimum wage levela fragmented
inspection system

Modern slavery in construction: recent stories
Drive laying and property repair
In May 2016, three family members of the Connors family were jailed at Cardiff Crown Court for modern
slavery offences in their tarmacking business. One victim, Michael Hughes, was targeted because he wasvulnerable. Held for 21 years, Hughes was hunted down and beaten when he tried to escape. Judge Neil Bidder
QC said the Connors treated their victims as “little more than objects.”48
In September 2017, 11 members of the Rooney family, who operated a tarmacking and property repair
business, were jailed for exploiting at least 18 victims. The Lincolnshire-based traveller family targeted people
that were homeless, had mental health issues, addictions or learning disabilities over a 26 year period.
Victims were frequently subjected to violent beatings and forced to work seven days a week in all weathers.
They often went hungry or were given the family’s leftovers. The judge described the family, who lived a lifeof ostentatious luxury, as “chilling in their mercilessness.”49

Demolition and asbestos removal
Jozef50 was a semi-skilled plant operator and bricklayer from Slovakia. Unable to speak English, he was dupedby an Eastern European crime gang with the promise of well paid work and accommodation in the UK.
On arrival, Jozef was put to work on demolition sites in the West Midlands. The traffickers withheld his
passport and controlled his bank account, paying him between £15 and £20 a week. Jozef was held in
unsanitary and unsafe conditions. His work included breaking up asbestos without any health and safety
equipment.
After eight years, Jozef developed a chronic chest infection. When he was too ill to work, his handlers threw
him out onto the streets. Becoming homeless, Jozef was discovered at a food bank by anti-slavery charity
Hope for Justice in 2015. Despite long term support and rehabilitation, his long term health issues have madeit impossible for him to find work.
Jozef estimates that he earned just £1,100 during his eight years in modern slavery.

48
49
50

24

BBC, ‘Modern slavery’ family jailed for Cardiff forced labour, 24 May 2016
The Guardian, 11 members of Lincolnshire family jailed in ‘chilling’ slavery case, 12 September 2017
Name has been changed to protect identity

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Block paving
Phil, a 37 year old former holiday rep began sleeping rough on the streets after his relationship broke down.
He was approached by travellers who offered him up to £80 a day working in fields or laying block paving.
In reality, Phil worked 12 hour days, living on scraps of food, enduring regular beatings. His work included
laying patios and paving.

“There was always someone sitting in the van watching you so running away
wasn’t a possibility. Four of us were often locked in a tiny caravan. They would put
dogs outside guarding us. There was no electricity, no running water. We were fed
occasionally, with leftovers,” he told the Manchester Evening News.51
Infrastructure
On one of the UK’s largest infrastructure projects, one work gang was recently discovered to be in forced
labour. However, the truth only emerged after a noticeable rise in health and safety incidents. The team had
been living in cramped accommodation and forced to hot bunk. After a change in shift patterns, they wereunable to find a place to sleep. Workers had begun making mistakes out of extreme fatigue.

Recycling
Within the last two years, Hope for Justice has removed around 50 victims from waste management
picking lines. “Recycling is a particularly vulnerable part of the supply chain that should be included in risk
assessments,” says the NGO’s team leader Gary Booth.

Major projects: from poor practice tomodern slavery“Criminals like the Rooney family are
obvious candidates, but big business is indenial that modern slavery has infiltrated
its systems too”
Dr Alexander Trautrims, project lead for theunchained supply, University of Nottingham
Rights Lab
Exposés of modern slavery in construction often
focus on high profile projects overseas. The New York
University Campus in Abu Dhabi and projects aroundthe Qatar 2022 FIFA World Cup are just two examples
of programmes that have attracted considerable media
and NGO scrutiny in recent years.
Meanwhile in the UK, negative coverage often
focuses on the supply chains of consumer-facing
industries such as fashion or food. Cases that touchon construction often involve travellers, such as the
Rooney family.

51

If this gives the impression that mainstream
construction does not have a problem, it is a mistaken
assumption. Unions have long been campaigningagainst the systemic abuse of workers on some of thiscountry’s largest projects. Cases, affecting both British
and migrant workers, range from minor exploitation
to forced labour.
Phil Whitehurst is the GMB Union’s national officer
for construction, and also and works across several
other industries. He says:“The big power generation sites can be like Dodge City
compared to manufacturing sectors with static supply
chains. People are often too scared to talk to the tradeunions.”Whitehurst tells of one incidence that came to the
GMB’s attention at the Ferrybridge Power Plant
project in Yorkshire.
“We first became aware of problems when a Spanish
worker was seen in the canteen with a notice roundhis neck asking if somebody would buy him a meal.
He was telling people he hadn’t been paid for threemonths.”Manchester Evening News, Shock figures show rise in modern-day slavery in Manchester, 12 December 201425

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Such incidents reveal how the sector is failing toprotect workers, even on projects with national
collective payment agreements.
A Home Office source says:“We’ve had dealings with major public
infrastructure and building projects.
We’ve also seen problems on hospitals,
power stations and prison sites. Clientsengage with companies with strong
reputations and brands, but they don’t
fully understand that the company can’t
deliver the whole project without thehelp of others. The further down thecontracting list you go, the weaker thevisibility.”
He adds:“We have a number of successful and ongoinginvestigations around firms that supply concrete
specialists from India. These firms are operating
nationwide. They’re often sophisticated and hidden
behind complex corporate structures....They areoften paying below the minimum wage, and areundercutting competitors that are doing things by
the book.”
Darren Jones, the MP for Bristol North West, singled
out construction in a recent Parliamentary debate.
He said:

The fact that the sector is difficult for outsiders
and law enforcers to navigate plays into the hands
both of organised crime gangs and unscrupulous
businesses.

“Construction is important. The questionis, when will there be political will to reallygo after the sector?” says one enforcement
officer. “Tactically, agriculture is easier toinvestigate. Raiding a field of strawberries,
no one’s going to get hurt, but raiding apartially constructed skyscraper is anothermatter.”He adds:“We’ve been in the situation where we were going toarrest people on site as a concrete pour was about totake place. We started to think about liability issues.
It’s unclear whether indemnity insurance would covercompanies in these cases, if they were unsure who was
working for them.
“The situation is not troubling the large companies at
the moment. That’s because they know that we’re goingafter the smaller companies in their supply chain –those directly liable for recruitment. The only time
I’ve seen main contractors getting nervous is when we
do something overt, putting 100 officers on the site
in hi-vis jackets – an action that the local media may
get to hear about. But most of the time, they’re happy
to collaborate because the effect on their business is
minimal.”“...It is often at the depths of the sub-contractor chainthat exploitation can take place...I raise this matterbecause I have significant construction projects inor near my constituency, including energy plants,
Hinckley Point C and its supply chain, tens of
thousands of new homes, expanding retail projects
and major infrastructure upgrades in Bristol.
I understand from trade union officials... that there
are concerns about unethical working practices in
my constituency that, in their view, approachmodern slavery.” 5252

26

House of Commons Hansard, Debate on Modern Slavery Act 2015, Volume 630, 26 October 2017

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

INTERVIEW: THE LEGAL VIEW
Criminal Barrister Caroline Haughey prosecuted the first modern slavery case in Britain in April 2011. She hassince advised on or prosecuted more than 40 defendants in modern slavery cases in England and Wales.
Haughey is a member of the government’s modern slavery taskforce. Her independent review of the Modern
Slavery Act 2015, commissioned by the then home secretary Theresa May, was published in July 2016.
What kind of modern slavery cases are you
dealing with at the moment?
I’m prosecuting a lot of labour exploitation– insome cases there are an excess of 250 victims. Someof these cases are trespassing into the constructionindustry.

What powers would you use?
Every power available to me. If we can’t succeed
through policing we could recommend a healthand safety inspection or fire safety inspection.
If we are not satisfied with financial activities
we may refer it onto the fraud squad, or tax
avoidance issues could go to HMRC.

What are you discovering?
At the moment the approach is to prosecute thetraffickers – the people that are clearly culpable.
But, the more we’re doing that, the more we’rediscovering industry collaboration with organised
crime. It could come from the top of organisation- or from individuals lower down in the company
that are collaborating with the slave market.
How common is it that company directors
knowingly encourage exploitation in thiscountry?
It’s not as rare as you might think. There arelarge publicly known organisations with a highturnover that are being very slack – that’s the mostpositive spin I can put on it – in human resources
recruitment.
Can companies further up the supply chain
expect prosecutions in the future?
Yes. Most companies don’t want to be criminal
employers, but there is a link between modern
slavery and involvement in money laundering,bribery and corruption. If you have exploitation
in your supply chain, you’re theoretically a money
launderer because you are encouraging andinciting criminal activity, facilitating someone’s
financial gain without doing appropriate checks
either because they are turning a blind eye oralternatively knowingly complicit.

Could you prosecute British companies
that are exploiting workers outside theUK?
Yes, even if I can’t prosecute for the primary
offence, I could go after them for othercriminality where I can demonstrate
appropriate jurisdictional interest. For example,
if fraud had been committed, I’d just need toshow that one element of the fraud has takenplace in the UK. If I could bolt on other areas
such as recruitment carried out from the UK,
I’d certainly look at it.
Are you sensing a change in public andgovernment mood?
Absolutely. Take blacklisting. Construction
workers fighting for their rights were denied
employment and a voice. There was a disgustwith that and public concern about ongoingpoor employment practices. The public response
is a closer look at what’s happening at home andabroad.
If, for example, a large building firm was failingto comply with basic employment standards
in the Gulf, that would have significant
ramifications. I would expect an inspection of
the company. Exactly what form that would
take, I couldn’t say, but there would be a close
examination of their practices.

27

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

How would you like to see companies
changing their behaviour?

Will the law take a more lenient view ofproactive companies?

I want to see a public statement of intent. I don’t
just want to see what they are saying, but what they
are actually doing.

Absolutely. The law is not prescriptive and nobody’s
supply chain is going to be perfect.

I want them to show me that they have educated
all their staff from top to bottom. Not just to look
for trafficking or exploitation issues within theirown company, but from the suppliers that they areusing. To be aware.
Construction sites have a high turnoverof people - won’t that be difficult for thisindustry to implement?
They can still do it. They have a health and safety
obligation to know who is on site and when. Basic
things like clocking in and clocking out, following
where the money is going and checking ID.
How do you feel about modern slavery
statements?
Public facing companies are more anxious to do
this right. Some large organisations are showing
root and branch reform – John Lewis, Marksand Spencer and H&M. But many companies arepaying lip service to it.
Could companies be prosecuted for filing false
or misleading statements?
Yes, I believe they could. All it could take isan NGO or a member of the public to draw
discrepancies to the Home Office’s attention andmake a strong enough case that they want to makean example of.
That’s the point of the Modern Slavery Act. It has
raised awareness about this as a sort of criminality.
It has made people think...if I can’t prosecute themunder this...what else can I do?

28

If you can show that you are proactively working
to improve worker protection in your supply chain,
you’re less likely to be prosecuted, unless there isdirect criminality. It’s in a company’s interests toreport problems, because it’s putting them as aprosecution witness rather than the defendant.
How do you see the situation evolving?
Personally, I’m noticing a large change. The police,agencies and government all have a strong desire to
make this legislation work. There are an increased
number of referrals. I’ve got prosecution work on
modern slavery cases for the next twelve months
and I’m not the only one. There’s also a lot ofengagement from other nations.
There’s a huge amount of work to be done, but I’m
optimistic. We’ll never stamp this out, but we’regoing to give it a bloody good try.

Construction and the Modern Slavery Act

How construction’s business model
is vulnerable to exploitation“There are a lot of decent people inconstruction. If they really knew how
some people were being treated by ruthlessgangmasters, there would be a bigger
outcry.”Peter Jacobs, CIOB past president, managing director
of construction logistics, Wilson James53
Construction industry’s traditional business models,from aggressive contracts to lowest cost tendering, area significant barrier to change or innovation. Growing
evidence shows that these models also have a negative
impact on worker conditions:

Low risk and low detection rate
Infiltrating construction makes good business sense
for corrupt labour providers. As employment practices
in the sector are less regulated than in food processing
or agriculture, they present lower operational risk forcriminals.
Although modern slavery is thought to be a hidden
crime, its signs could be visible to co-workers who may
be oblivious to what they are witnessing.
“I’m pretty sure every construction manager has had
the experience of workers who don’t speak English
being segregated on site and brought in and out by
the same mini bus every day. Most people wouldn’t
set out to exploit anyone, and therefore don’t expect
others to do it. They need to remind themselves thatthey could be witnessing a crime and to start asking
more questions,” says Dr Alexander Trautrims, project
lead for the unchained supply at the University of
Nottingham’s Rights Lab.

Heavy reliance on migrant labour

Tackling Exploitation in the UK

Even where a migrant has full rights to work in theUK, migrant status can contribute to exploitation.55
With tighter immigration controls expected after
Brexit, EU workers could become more vulnerable.
Migrant labour in UK construction56

THE UK CONSTRUCTION
SECTOR EMPLOYED

2.1 million PEOPLE IN 2015
270,653 workers(1 in 8 of the workforce) was born outside the UK

122,094 workers
came from EU accession countries

The most common source countries
for the migrant workforce were
Poland (55,500 workers) Romania (27,000)
India (19,400) Lithuania (17,200) and Ireland (15,000)

The most common role
for migrant workers
in construction was
general labouring

22% ofthe migrant
workforce

Migrants working in skilled jobs include:
Architects (15%), Carpenters and Joiners (13%),
Plasterers (13%), Bricklayers (11%) and Managers (9%)

Construction has an ongoing skills crisis. The
Construction Industry Training Board (CITB)
forecasts that the industry will need to recruit 35,740
new workers annually between 2017 and 2021.54

One in four employers
in construction directly
employs at least one non-UK worker

Migrant workers at all skill levels are filling the skills
gap. It is estimated that non-UK workers account for
10% of the total construction workforce. The sector
relies heavily on Eastern European workers.

In London, one out of two construction
firms is heavily reliant on migrant labour

53
54
55
56

See Wilson James case study
CITB & Experian, Industry Insights, Constructions Skills Network Forecasts 2017 – 2021, 2017
Joseph Rowntree Foundation, Forced Labour in the United Kingdom, 2014
CITB, Migration and Construction:The view from employers, recruiters and non-UK workers, June 201729

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Outsourcing and cut price tendering“..The construction business model isn’t
working ... the profit margins of the top
ten contractors...[are] about 0.8%. Thosethat are doing well would declare about
2% margins and that’s just not sustainable
for the level of risk that they take...” 57
Suzannah Nichol MBE, chief executive, Build UK
Major contractors rely heavily on outsourcing andusing tiers of subcontractors to reduce their financial
risk. In fact, 99.9% of the industry is made up of
SMEs.58
This creates intense competition, leading to lowest
cost tendering. Tier one contractors complain thatthey are lucky if they make 2% margins, but margins
become even tighter with every subsequent layer ofsubcontracting. The model puts smaller companies
under constant pressure to reduce their overheads.
“If a price is too good to be true, buyers should beasking themselves if they’re ethically doing the rightthing,” says one enforcement officer. “But at the
moment many major contractors are putting theirheads in the sand.”Retentions
Retentions are commonly used in construction.
Accounting on average for 5% of contract value, they
are held back by clients as an assurance of projectcompletion and a safeguard against defects. Retentions
tend to be held at each level of the supply chain, and itis the lower tiers that suffer most from systemic abuse.
In a study conducted by the Building Engineering
Services Association (BESA) nearly 60% of 341
engineering services businesses said that a substantial
amount of their turnover was being held in
retentions.59
Problems tend to start at the top of a supply chain.
A study for the Department of Business, Energy andIndustrial Strategy (BEIS)60 found that 10% of tier two
and three contractors had experienced not receiving
retention payments within the previous three years.

57
58
59
60
61
62
63
64

30

A common reason was that the client had withheld themoney from the main contractor, which had in turndeclined to pay its subcontractors.
Tier one contractors were also found to be relying on
retentions to help with cash flow. The survey foundthat 37% of major contractors were using retentions
to pay labour costs, and 29% were using the moneyas part of their general expenditure. Clients andcontractors were often withholding payment toachieve a project discount.
Although withholding retentions will not necessarily
lead to modern slavery, it does contribute to worsening
conditions for workers. It also sets an environment
where corners are more likely to be cut. From
substituting materials to skimping on health andsafety or withholding holiday or sick pay, a culture iscreated in which exploitation is easier to hide.
“In a sector where margins are as tight as construction,
there is a tendency for companies to do the bareminimum to comply with the law, rather thaninnovate,” says one consultant.

Late, discounted or non-payment“We’ve trained a generation of young
people in the industry to think beating up
subcontractors is the way business should
be done. It’s shameful.” 61
Dispute resolution expert
Late payment is endemic in construction, andcomparatively worse than in many other sectors.62 The
Asset Based Finance Association (ABFA), now part oftrade association UK Finance, says that construction
insolvencies accounted for 17% of all corporatebankruptcies in the UK in 2015, with late payment themost common reason.63
Payment terms of 120 days are already the norm formany SMEs, but the Federation of Master Builders(FMB) claims that clients are engineering evenlonger delays on spurious grounds. In the FMB’s
recent survey of nearly 350 small construction
businesses,64 nearly a quarter had had to wait morethan four months to receive payment. Companies also
complained of ‘scope-creep’: being forced to do extra

Speaking on BBC2, Newsnight, 15 January 2018
Department for Business, Innovation & Skills (BIS), UK Construction, An economic analysis of the sector, July 2013
Construction Manager, 60% of engineering firms say turnover is held in retentions, 20 November 2017
Pye Tait on behalf of BEIS, Retentions in the construction industry, BEIS Research Paper 17, October 2017
The Telegraph, Construction giants ‘bullying’ small businesses, 12 October 2012
Smallbusiness.co.uk, Why late payment hits the construction sector hardest, 23 August 2016
ABFA, Construction companies hit hardest by growing waits for payment, 22 August 2016
FMB, Cowboy Clients Survey, November 2017

Construction and the Modern Slavery Act

work which was not in the contract and for which they
were not paid.
Other abuses of the system, noted by the FMB andothers, include charging suppliers a fee to tender
for work, as well as pressurising them to offer
retrospective discounts on completed jobs, in returnfor faster payment.
Payment problems reverberate inside and outsideof businesses. In the FMB survey, 30% of SMEs thatwere still waiting for their due payment were forced
to delay paying their own suppliers. And 5% - around18 companies - said that they had been forced to delay
paying wages to staff.
The industry’s systemic problems came into sharp
focus with the collapse of construction giant Carillion
in January 2018. The contractor went into liquidation
owing around £1 billion in unpaid invoices to an
estimated 30,000 UK businesses. Some of its problems
arose because it had bid aggressively low on manytenders, leaving it unable to cope with project delays
and cost rises.65
Although the government stepped in to honour
Carillion’s public sector contracts, companies on
Carillion’s private sector projects were treatedmerely as creditors. Trade associations predicted acatastrophic effect on supply chains, leaving many
more firms at risk of bankruptcy and thousands ofjobs and pensions at risk.

Time constraints
When projects are delayed, companies sometimes takeon extra workers at the last minute to fulfil contract
obligations.
“There will be a temptation to get workers in with noquestions asked to avoid financial penalties,” warns
the GLAA’s Mark Heath. “Businesses need to question
whether their contractual arrangements are creating
the conditions for exploitation.”
When operating under intense schedules, companies
should be alert to a variety of scams. For example,
there are anecdotes of unskilled workers being sent toa project with the promise that they are “just waiting
for their CSCS (Construction Skills Certification
Scheme) cards to arrive”. In reality, the workers will
never get the cards and quickly pass through a variety
of sites to avoid detection.

65
66

Tackling Exploitation in the UK

The price of flexibility“There are large publicly known
organisations with a high turnover thatare being very slack –that’s the mostpositive spin I can put on it – in humanresources recruitment.”
Caroline Haughey QC
The UK has the largest proportion of agency workers
in any country of the European Union. In 2007, theproportion of the UK workforce in temporary agency
work was more than double the second largest marketof the Netherlands.66 With the emergence of the gig
economy and zero hours contracts, the proportion is
likely to be even higher today.
In a sector as volatile and uncertain as construction,
outsourced labour provides the industry with muchneeded flexibility.
But Andrew Crane, professor of business and society
at the University of Bath’s School of Management
cautions:“Some large companies are trying to get flexibility on
the cheap. They’re using it to cut costs, rather than toenable them to be more agile.”
He gives the example of minimum wage.
“Firms are pricing labour into their contracts at
minimum wage level without any recognition that,once you subcontract four or five times down the
chain, it’s impossible for those workers to receive
the legal amount, because so many other parties aretaking a cut.”

Bogus self employment and umbrella
companies
Bogus self employment occurs when an individual
appears to be operating independently but in reality
is working for a single employer.
Historically, many companies and agencies
encouraged bogus self employment to avoid paying
their share of national insurance contributions.
Workers were enticed (sometimes forced) into self
employment by the prospect of paying lower rates oftax. But they also lost employee rights and protections.

The Telegraph, Carillion collapse leaves 30,000 businesses losing out on up to £1 bn, 16 January 2018
Gallagher N and O’Leary D, Recruitment 2020: How Recruitment is changing and why it matters, April 200731

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

In 2013, HMRC estimated that 200,000 people in theconstruction sector were wrongly designated as self
employed, with significant losses to the government intax revenues.67

amount the umbrella company chooses to givethem. In other cases, workers have been told to signa contract agreeing to payment via an umbrella
company or face losing their job.”69

In April 2014, a government clampdown banned
employment agencies from bogus self employment
practices. The intention was to force agency workers
onto full employment contracts. Instead, manyagencies exploited a legal loophole, moving people into
umbrella companies.

Umbrella companies have become so widespread,
unions claim, that many workers are unable to findalternative forms of employment. Some workers
are pushed into signing zero hours contracts with
exclusivity clauses forbidding them to work elsewhere.
Many complain of habitual late payment, as the agency
and umbrella company blame each other for delays.

Umbrella companies were intended to be used as alegitimate tax scheme for temporary workers. But
UCATT68 described them as a ‘con trick’ that duped
workers into a significantly reduced take home pay:
“Some UCATT members have been switched to
payment via umbrella companies without theirknowledge. Or they apply for a job advertised at £12
or £13 per hour, only to find they are being paid thenational minimum wage, plus whatever additional

Such companies often make “administrative”
deductions from wages, forcing employees to shoulder
extra costs, such as the employer’s share of national
insurance payments. Workers are in effect taxed
twice, and are less likely to receive their full holiday
entitlements or pension payments. They are often kept
in a state of uncertainty and confusion by complex andhard to decipher wage slips.

How the umbrella company scam works

1

An employment agency recruits a worker agreeing an hourly rate

2

Once the worker has agreed the terms, he or she is employed by the agency’s umbrella company

3

£

£

The umbrella company receives the worker’s full hourly
rate from the agency, but makes its own deductions
before passing on the money

4

By law, the umbrella company should be paying the employer’s share of national insurance contributions.
Instead many companies take this money out of the worker’s wages

5

The worker is effectively being taxed twice – paying both his and his company’s share of national insurance

6

Umbrella companies often fail to acknowledge national agreements, such as a worker’s right to free travel
to work, beyond a certain distance7

Workers do not receive paid holiday as fully employed workers would. Instead their holiday pay is calculated
against national minimum wage rates, and rolled into monthly payments

8

Workers can also lose out on pensions, as the umbrella companies delay enrolling workers into government
pension schemes. As workers move from job to job every few months, they risk being in pensions limbo

67
68
69

32

HMRC, Onshore Employment Intermediaries: False Self-Employment, December 2013
UCATT has since merged with the Unite union
UCATT, The Umbrella Company Con-Trick, May 2014

Construction and the Modern Slavery Act

Small clients and the decline of collective
bargaining
Collective agreements between employers and tradeunions are designed to protect all parties on a project,regulating terms and conditions in the workplace, andsetting out duties of care for employers.
But unions say the use of collective agreements,
such as the National Agreement for the Engineering
Construction Industry (NAECI) negotiated by
the National Joint Council for the Engineering
Construction industry (NJC) is in decline as clients
aim for the cheapest possible contracts.
“You can particularly see this in small scale projects
like waste to energy plants,” says the GMB’s Phil
Whitehurst. “They’re all being done under the radarwith local planning permission.

“The lowest bidder wins the contract at
tendering stage, no matter what their pastrecord is with regards to safety and terms
and employment conditions...[It] ultimately
encourages spurious employment methods
such as zero hours contracts.”
Part of the problem, Whitehurst claims, is that the UK
has not fully implemented the EU Posting of Workers
and Enforcement Directive.
The directive is supposed to guarantee faircompetition across the EU along with respect forworkers’ rights. One of its key aims is to avoid“social dumping”, preventing foreign companies
from undercutting domestic businesses with labour
standards and wages that are below market rates.
However, foreign companies are exploiting a legal
loophole in the UK, forcing legitimate businesses outof the market and paying workers below market rates.
“Many UK-based companies can’t compete. A lot ofthem are either pulling out of certain markets entirelyor changing their business models,” Whitehurst says.

Intimidation at home and abroad, and at
all skill levels
Exploitation is commonly thought to be confined tounskilled labour, but unions say that skilled workers
are being increasingly forced into exploitative labour
conditions. Problems are spreading as local companies
compete to slash tender costs.

Tackling Exploitation in the UK“This is affecting everyone from civils workers who set
out the concrete to steel fixers, welders, pipe fitters andsteel erectors. They are all highly skilled professions,”
Whitehurst says.
The weak bargaining position of workers, he adds, isleading to generalised feelings of intimidation on site.
He gives the example of an incident on the Ferrybridge
Multifuel 1 site in Yorkshire where three eastern
European workers revealed to the GMB that they werebeing exploited.
“The very next day they were on a plane home with the
managing director. He made excuses saying that they
were going to a different job. But it was obvious thatthey were finished for talking to the unions.”
In another case at Ferrybridge, GMB and UNITE
managed to reclaim £90,000 in underpaid wages andallowances for employees of Croatian company ÐuroÐakavic TEP. Whitehurst says that after the money
was reclaimed, the men were “constantly harassed andintimidated” by Ðuro Ðakavic’s senior management
for the remainder of their time in the UK. He claims
that their harassment continued after they returned to
Croatia in 2015.
The company has taken workers to court for the returnof the “overpaid” salaries. When one refused to repay
more than 50% of his legitimate UK wages, he wrote to
the British unions asking for help, saying that his salary
had been slashed to minimum wage. Others that have
moved on to different companies are also being ordered
to repay the money. Legal battles are ongoing.
It is this kind of intimidation, Whitehurst says, thatmakes people think twice about coming forward withcomplaints.

“The gangmasters rule by fear and are
absolutely ruthless. Normally it’s aforeman or a manager who has got agood grip on migrants. They won’t get
any more work in their home countries
if they cross these people.”
But he adds that British self-employed agency workers
also feel vulnerable.
“People are very reticent in carrying complaints
forward. They’re scared of leaving anonymity
because they’ll either get chopped, blacklisted orwill have to come off the job. Companies would
just get rid of them.”

33Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Blacklisting
The construction industry has been hit by a series of
blacklisting scandals. In 2016, unions collectively won
around £75 million in compensation for nearly 800
workers that had been denied jobs for union activity or
raising health and safety issues.70
This followed a long legal battle after a list containing
the details of 3,213 workers was found in the offices of
the Consulting Association in 2009.
But Unite says blacklisting is still a “contemporary
problem that continues to blight lives.”
GMB’s Phil Whitehurst believes that blacklisting may
be ongoing in a less formalised way.
“Blacklisting is still happening in a different form,”
he says. “I know of several good people that still can’t
get a job.”

Domestic clientsAt the domestic level, bargain-hungry homeowners are
at risk of fuelling exploitation in construction.
In a recent survey by Plentific, nearly half of UK adults
admitted to having paid tradesmen in cash in order to
get a discount.71 The Taylor Review estimates that cashin hand work represents an annual £6 billion spend in
the UK, much of which is untaxed.72
Paying cash for kitchen fit-outs and extensions may
seem like a good deal to consumers, but it shortchanges society: companies that fly under the radar
are not only undercutting legitimate tax-paying
companies, there is a high chance that they arealso taking short cuts on health and safety and notcomplying with wage laws. In the worst cases they
could be using trafficked people.
There was a recent incident in Scotland, where an
Eastern European worker turned up to tile a kitchenlate afternoon on Christmas Eve.
“The homeowner didn’t find it odd that thelabourer was turning up at such an unusual
time and working through a public holiday, but
circumstances suggest that the person was being
exploited, if not trafficked.

70
71
72
73

34

“I suspect that traffickers may view the domestic sector
as a soft market for exploited labour, particularly as
many householders will have low awareness of thesigns of human trafficking. I would stress to the publicthat if something doesn’t feel right, it probably isn’t,”says John Merralls, senior operations manager at
Migrant Help UK.

Future risks:
Costs73
Even though tender prices have been at a historic highin the past two to three years, many contractors havestruggled to make a profit.
“Margins are in negative territories, particularly withsome of the bigger contractors and a lot of the supply
chain hasn’t made any money. That’s a real concern for
the industry. It’s not creating a great environment for
innovation or investment in people,” says Will Waller,
director, head of futures at Arcardis.
The squeeze on margins has partly been driven by
the falling value of the pound after the Brexit vote.
Materials costs have risen between 5% and 6% within
the last 12 months. To compound the problem, theglobal prices of some essential products, such as steel,are rising independently.
Labour wages have also been rising, partly due to theshortage of skilled workers. Arcadis is predicting thatannual labour wage inflation is likely to remain at 3%
until at least 2020.
“Some trades and skills will see higher rates. Wages forbricklayers and carpenters have seen rises of 10%,” Wallersays, adding that industry is likely to face cost pressures,at least as long as uncertainty over Brexit persists.
Imports account for 30% of materials used in building
and infrastructure projects and 62% of imports tothe sector come from the European Union. In 2016,
the UK construction sector imported approximately£15.5 billion of materials or components, with the EU
accounting for roughly £10 billion of that sum.
Depending on the terms that the UK negotiates with
the Europe, major structural shifts are anticipated insupply chains over the next few years, with added cost
inflation.

BBC, Construction workers win payouts for ‘blacklisting’, 9 May 2016
Plentific, Nearly Half of UK Adults Admit to Paying a Tradesman Cash in Hand to Get a Cheaper Deal, 28 July 2017
BEIS, Good Work, the Taylor Review of Modern Working Practices, July 2017
CIOB would like to thank Arcadis for the data supplied for the Costs section

Construction and the Modern Slavery Act“In the case of a no deal scenario, it’s likely that there
will be serious logistical problems getting materials
onto site. The problem could be quite acute over the
short term, adding 2% to 3% on top of other costs,”
Waller estimates.
The security of planned future projects is difficult topredict. If the UK does negotiate a deal with the EU,
Arcadis is anticipating that domestic demand forconstruction could start growing from 2019, but “theassumption is under constant review”.
Leaving the EU could potentially create a large gap infunding for public projects. The European Investment
Bank ploughed £6.9 billion into UK infrastructure
projects in 201674, accounting for roughly 25% of thecountry’s infrastructure output. Under EU rules,
the UK is expected to leave the EIB after Brexit, and,according to The Times, the EIB has already imposeda moratorium on new long term loans to the country.
The British government’s strategy for replacing thisfunding is not yet clear.

Organised crime
As border controls tighten, it is expected thatorganised criminal activity will expand to help
migrants cross frontiers, significantly raising the risksof exploitation.
The NCA says:

Tackling Exploitation in the UK

Falling migration
Since the Brexit vote, net migration to the UK has beenfalling, particularly from EU8 countries. Recruiters
have noticed a decreasing number of applications from
EU workers for low skilled positions.
Construction is already facing a skills crisis, but the
Recruitment and Employment Confederation fears
that unscrupulous employers in general, “may resort toundocumented workers to keep their businesses afloat,
which could also lead to cases of exploitation andmodern slavery.”77

Racial abuse
Unsavoury trends have been emerging since theBrexit vote. In a recent cross-industry workshop on
fairness, inclusion and respect, more than two thirdsof participants had noticed an increase of incidents ofracial abuse on construction sites.
CIOB VIEW: Creating a culture of fairness,
inclusion and respect
Steeply rising costs for materials and labour andpolitical uncertainty over funding continue tosqueeze the industry. Spending cuts could force
down tender prices to unsustainable levels, pricing
legitimate lower tier companies out of supply chains.

“Criminals are not constrained bygeographical or jurisdictional boundaries
and are inherently opportunistic. We
expect that many will strive to takeadvantages of the opportunities that
Brexit may present.” 75

It is an environment that discourages investment inskills and people. It could also increase the potential
for exploitation as employers try to reduce theirrising wage bills.

According to Verisk Maplecroft’s Modern Slavery
Index 2017, risk of trafficking has risen in 20 EU
countries. Greece, Italy, Cyprus and Bulgaria areparticularly vulnerable as they are often entry points
for migrants into Europe, whilst the slavery situationin Romania, a significant labour source nation for theUK, was identified as “deteriorating worse than any
country globally”.

As the value of the pound remains low against
other currencies, British companies are alreadylooking for cheaper deals with their suppliers. Due
diligence will be essential to ensure that they are notincreasing greater human rights risks in their supply
chains. Post Brexit, serious supply chain disruption
may force buyers to seek out products from regionswith higher human rights risks.

In the 2017 Index, both the UK and Germany scorednegatively on the previous year, slipping from low risk
to medium risk countries.76

Political instability is breeding an environmentof fear. Employers must work harder than ever touphold a culture of fairness, inclusion and respect
for all nationalities in the workplace.

74
75
76
77

Construction is heavily reliant on foreign workers.
Its current skills crisis could be exacerbated byfalling numbers of legitimate migrants, making thesector lucrative target for organised gangs.

The Times European Investment Bank cuts off cash for British building projects due to Brexit, 22 August 2017
NCA, National Strategic Assessment of Serious and Organised Crime, 2017
Verisk Maplecroft, Modern Slavery Index 2017, August 2017
REC, Ready, willing and able? Can the UK labour force meet demand after Brexit?, September 201735

Construction and the Modern Slavery Act

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The GLAA targets construction
The agency formerly known as the Gangmasters
Licensing Authority (GLA) became the Gangmasters
and Labour Abuse Authority (GLAA) on 30 April
2017. With its new name, the agency has a broader
remit: to tackle exploitative practices across all of
British industry.
Identifying construction as a high risk sector, the
GLAA is working with employers, agencies, trade andprofessional bodies to raise employment standards.

How the GLAA is changing
The GLA was established in 2005 to regulate theemployment of temporary workers in the agricultural,horticultural, shellfish and food processing industries.
It issues around 1,000 labour licences to those sectors
annually.
Now, as the GLAA, the organisation has the remit
to carry out investigations in any sector. It cansearch and seize property, issuing labour market
enforcement undertakings and orders to businesses
that are not protecting workers. There is a maximum
two-year prison sentence for serious or repeat
offenders.
The GLAA runs a confidential hotline for reporting
suspected abuse and a separate advice line to help
businesses combat modern slavery.

Working with the sector
As yet, there are no plans to extend the GLAA’s
licensing regime into construction. However, theagency wants to work collaboratively with the sector
and launched a protocol for construction in October
2017. This establishes, amongst other things, avoluntary information sharing agreement.
A number of organisations including Sir Robert
McAlpine, Morgan Sindall, Marshalls, Willmott
Dixon, CIOB, BRE and IEMA have signed up to theprotocol.

INTERVIEW: Paul Broadbent
Former GLAA chief executive Paul Broadbent had a 30 year career in policing before joining the agency in2013. A passionate and innovative leader, Broadbent was determined to tackle all forms of labour exploitation.
He died unexpectedly in December 2017. This interview is a tribute to his work and vision.
How do human trafficking and modern
slavery compare to other crimes?

How easy is it for organised crime to infiltratelegitimate supply chains?

For criminals, it’s low risk and high yield. I knowof some gangs have switched from dealing in gunsand drugs to dealing in people. Not only are therisks of arrest or prosecution lower, they can also
make more money out of people.

Criminals are entrepreneurs by their very nature.
Even if companies have good systems, processes
and people in place, some exploitation will still get
through.

Why were the risks of prosecution so low inthe past?
It’s about perception and understanding, but thisis changing now. As a police officer, if I caught
someone in possession of guns or drugs, they’dalmost definitely go to prison. But finding someone
with a number of people in a van who were tooscared to say anything, the chances of arrest andprosecution for trafficking were much lower.

36

The analogy I’d use is the horsemeat crisis – thefood industry’s supply chain was long and complex
enough for beef to be substituted. Trafficked people
could be switched into labour supply chains oflegitimate businesses in similar ways.
What evidence have you found of exploitationand modern slavery in construction?
Here’s a typical scenario: an organised criminalgang buys a street of terraced derelict houses andtraffics a number of people in from Eastern Europe.

Construction and the Modern Slavery Act

They gradually move along the street as propertiesare renovated. They won’t be paid anything likethe minimum wage and are living in squalid
conditions, under fear of violence. They’ll befacing threats like “we know where your family
lives back home”.
We’re also aware of problems on major sites - but
we’re still building our intelligence picture.
What are you expecting from employers andlabour agencies?
The first question companies should be asking
themselves, is not, is labour exploitation happening
in my supply chain? But where is it and what
systems have we got in place to identify it?
Companies need to go beyond box-ticking
exercises. In our experience, worker interviews canbe key to finding out what is happening on site.
Why are you targeting bogus self
employment?
This is a huge problem nationally. The exchequer
is being defrauded and the employees havegiven away their employment rights. We lookat anything from failing to pay wages, paying
below minimum wage, withholding holiday pay
and unlawful deductions for clothing or safety
equipment.
How much difference has licensing made toagriculture and horticulture?
Licensing makes it mandatory to treat workers
with common decency. In the past four years, we’ve
noticed that compliance among licence holders
has gone up considerably. In fact, intelligencesuggests that our success has pushed disreputableagencies into other less regulated areas, such as
construction.
Will labour licensing be extended toconstruction?
There are no current plans for that, but I could see
a time when that conversation could take place.
Our tried and tested codes of practice could work
equally well in construction. It could happen either
on a mandatory basis or by the industry voluntarily
adopting standards.

Tackling Exploitation in the UK

What should managers do if they suspect a
problem on site?
If life is at risk dial 999. But if something doesn’tlook quite right, call us first and we can discretely
and subtly work with you to establish whether
there is a problem.
Protecting victims is our first priority, but we act
with complete discretion. Having worked withretail for the past 11 years, we understand thesensitivities around brand reputation.
What happens when people take matters into
their own hands?
There’s a danger that the criminals will be alerted
and disappear. People have called us to say“we’ve sacked the individual who was causing
the problem, can you help us with the rest of
the investigation?” While we can help, valuableevidence is lost, and the likelihood of bringing
perpetrators to justice is severely diminished.
What if companies fear prosecution after
reporting problems?
Ethical companies have nothing to fear. We’re nottrying to catch companies out. We want to help
them raise their own standards internally. We wantto create a more hostile environment for exploiters,
and yet a safe environment for legitimate businessto flourish. There’s a balance there.
What are your predictions for coming years?
I’m expecting a rise in the number of reported
incidents in the next two years, and a marked risein the number of prosecutions. From 2020 onwards,
society should expect a fall from number of victims
coming forward because, by that time, some of oursystems and initiatives will have really started tokick in. But at the minute, we’re still discovering
what the true scale is – so it’s going to go up.

Contact the GLAA on
0345 602 5020 for general enquiries
Or call 0800 432 0804
to report problems

www.gla.gov.uk

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CIOB VIEW: Will labour licensing
come to construction?
Given the success of licensing in agriculture,businesses should not rule out a time whenlicensing is introduced, either on a mandatory
or voluntary basis. The Parliamentary Joint
Committee on Human Rights has advised that
GLAA’s licensing powers should be extended
both to garment manufacture and construction.78
The Association of Labour Providers has also
launched labour recruitment certification scheme
Clearview. Clients, contractors and labour
agencies should prepare themselves for greater
scrutiny.

Joining up the disciplines
Information is an important weapon against
slavery and human trafficking, which thrive insecret. So it is vitally important that businesses,
the police, NGOs and agencies connect and share
information regionally as well as nationally.
The GLAA’s construction protocol creates a safe
platform for interaction with industry. Other
recently established initiatives include the West
Yorkshire Anti-Trafficking and Modern Slavery
Network set up by Hope for Justice and West
Yorkshire Police and an initiative in the East
Midlands, led by Derby University.79

LEARNING FROMOTHER SECTORS :FOOD PROCESSING“Criminal gangs keep evolving” - anoperations manager’s story
Construction can learn a lot from the agriculture
and food processing industries. As well as
employing a large numbers of low skilled migrantlabourers, the sectors have been regulated by
the GLA (now GLAA) for more than a decade.
Despite the extra scrutiny, keeping modern
slavery out of supply chains is still a struggle.
An operations manager in an East of England
food factory tells his story.
78
79

38

“In the early noughties our company wasn’t reallyaware of slavery. We viewed potential victims ascriminals – illegal workers or benefits cheats – notrealising that they could also be exploited.
I was doing everything that I was supposed to be
doing: checking and verifying documents with theHome Office, getting involved with Ethical Trading
Initiative audits.
Then I saw a news story about 58 Chinese nationals
dying in the back of a lorry at Dover. This was a
wakeup call, as Chinese people were employed in myfactory. I started visiting all the nationalities working
for me and was appalled at what I found. One wasbeing paid roughly 17p an hour, and working up to
67 hours a week. Others had been abandoned by their
exploiters and left destitute. Another woman hadn’t
been able to pay her traffickers, so the camp enforcer
raped her to settle the payment.
I’ve been tackling this criminal activity ever since.
As well as finding modern slavery, I’ve found many
examples of British nationals in conditions of
exploitation.
The challenge is that criminal gangs evolve and adapt
very quickly.
For example, a gang approached me with the offer
of labour in 2003. On checking the documents, I
immediately spotted that workers were living at thesame address and sharing telephone numbers, so it
was easy to report them.
But things have moved on. Audits routinely check forshared accommodation, so the criminals have changed
their model. They may only put one or two workers oneach worksite to keep people guessing.
Similarly, we used to pay people in cash. Then werealised that traffickers were visiting workers on a
Friday night and just leaving them with £10 for theweek.
We insisted that everyone had their own bank account.
Having gained proof of this, it later emerged that theaccounts were being controlled by traffickers.
In reaction, we demanded to see workers’ bank cards.
Initially, all the workers brought their bank cards
to work. This didn’t last long. A few weeks later,
no worker had a card on them. The traffickers hadcancelled the original cards, issuing themselves withnew ones.

Parliamentary Joint Committee on Human Rights, Human Rights and Business 2017, Promoting responsibility and ensuring accountability :sixth report ofsection 2016-17, 29 March 2017
See industry initiatives section

Construction and the Modern Slavery Act

Exploiters keep evolving to outwit our checks. They’re
doing it faster than we can keep up. That’s why you
can’t rely on audits. They have their part to play inraising standards, but they’re not enough on theirown. In the 15 years I’ve been fighting modern slavery
I’ve never caught an exploiter through a straight audit.
You need to do a whole range of things – including
regular worker interviews, training and awarenesscampaigns. You’ve also got to create a culture where
people feel it’s safe to talk to you. But it’s important not
to be too heavy handed. Asking someone point blank“did you pay anyone to get this job?” they’re going toclam up and look away. You need to be more subtle
and build trust over time.
I try to encourage a culture where all workers all lookout for each other, because they’re the ones that are
best placed to spot problems. If it’s left for managers
to uncover exploitation, the situation will have been
going on far too long, with untold physical andpsychological consequences for the victims.

Tackling Exploitation in the UK

Often things arise from casual conversations. For
example, one of the women on my shop floor said tome: “Oh, the Brazilians are always up for overtime”.
This was a total surprise, as I didn’t think I had any
Brazilians working for me. I had personally checked
all the papers of my workers on the site, and they had
also been approved by the Home Office.
But it turned out that a highly sophisticated forgery
ring had set up in the local town, trafficking invulnerable people from Brazil.
It was a help when the GLA started regulating my
sector, because a large number of less reputableagencies disappeared overnight.
My advice to anyone who thinks that they have aproblem is to report it discretely to the professionals
like the GLAA. Trying to take matters in your own
hands could have terrible consequences for the mostvulnerable people. The worst possible scenario is thatthe worker will just disappear, and no one can help
them then.”

INTERVIEW: Independent anti-slavery
commissioner Kevin Hyland OBE
Kevin Hyland spent 30 years as a police officer, including four years leading London Metropolitan Police’s
human trafficking unit, before being appointed the UK’s first independent anti-slavery commissioner in
November 2014.

What has been your experience as theUK’s first IASC?

What do you think of industry’s
response to the Modern Slavery Act?

It’s been a positive experience – I’ve seen areasof best practice being developed and individuals
taking on the responsibility of tackling this crime
head on. It has at times been challenging, pushingfor agencies to respond to modern slavery with theseverity it requires. One thing we can all agree onis that modern slavery is wrong, and it requires
coordination, determination and professionalism
for it to be stopped.

To date, the response has been patchy. We haveseen some companies taking the lead, publishingsubstantive modern slavery statements andtaking concrete steps to understand the risks
within their businesses with clear plans on how
to address them. However, many companies havefailed to step up, with a significant proportion of
those required to publish statements under theModern Slavery Act failing to do so in the mannerrequired by the legislation.

Has the scale of modern slavery in thiscountry surprised you?
It hasn’t come as a shock, but it is most definitely
a great shame. It is a shame on us all. With apolicing background of 30 years I agree with the
NCA that cases of modern slavery in the UK aremuch higher than previously estimated.

You wrote to 1,000 companies
about transparency in supply chains
reporting. What did you say?
We worked with the UN Global Compact toidentify 1,000 companies with whom we thought
engagement would be beneficial to driving up

39

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standards. We drew attention to the requirementsof Section 54 of the Modern Slavery Act andmade the case for taking this issue seriously at thehighest corporate levels.
We felt it was important to remind companies
that scrutiny over their practices relating tomodern slavery is only likely to intensify as morejurisdictions introduce legislation. We also calledon them to work in partnership with peers, asslavery and trafficking affect all companies.

What are the most common mistakesthat companies are making regarding
the Modern Slavery Act?
A significant proportion of companies are failing totake any substantive steps on modern slavery andthis is something I want to see changing fast. This
is not a mistake, but a wilful avoidance of theirlegal and moral responsibilities.
Where companies are taking action, some are
failing to embed it across all functions and wereally need to see this shift. Many companies areundertaking one-off audits but they must realise
this will be an ongoing issue needing continuous
diligence checks: just because your workforce andsupply chain are free from forced labour today, it
doesn’t mean it will be six months from now.
However, there are some leading lights. I am
pleased to see companies doing extensive riskmapping of their operations and supply chains
to identify potential problem areas, creating realaction plans to engage with suppliers and putting
in place meaningful remediation programmes.

What is your view of the response of theconstruction sector?
With 16 million victims of modern slavery
worldwide in the private sector, and theconstruction industry a high-risk area, tackling thecrime in this sector is a priority for me.
I have been pleased to see efforts in theconstruction sector to raise awareness andunderstanding, such as the CIOB’s own slavery
project including its reports and joint toolkit with
Stronger Together. These are glimmers of a morerobust response to the issue, but there remains along way to go until best practice is commonplace.

40

What will happen in the future tocompanies that do not comply with thelegislation - or wilfully mislead in theirmodern slavery statements?
Companies that are non-compliant with Section
54 are at risk, according to the legislation, of civil
proceedings. It may be that if non-compliance
continues at current levels, we will start to see thisaction taken. I would like to see the government
step up its scrutiny on these statements and part ofthis would include producing an annual list of all
the companies which should be reporting under
the legislation. I am supportive of civil society
organisations which produce well-researchedrankings, helping to apply pressure to low
performing businesses.

Do you believe that guidance, codes ofpractice and transparency reporting will
be enough to combat slavery?
The Modern Slavery Act is still relatively new. As
such, we are just starting to see a shift in culture,with companies only now looking into this issue
properly. It may be that in time we would needfurther legislation, however in the meantime
scrutiny and pressure should be applied and wemust continue to monitor the situation.

How do the UK efforts fit into the global
picture of anti-slavery initiatives?
Modern slavery is now firmly on the international
development agenda, with UN Sustainable
Development Goal 8.7 aiming to eradicate modern
slavery, forced labour and human trafficking by2030. The UK is a global lead on this issue, driving
change across many sectors, influencing othercountries as they draft legislation, and building
capacity of the international law enforcement
response.
As complex migration flows increase andtechnology advances, we must remain on theforefront of the fight against this crime. It is myhope that combating modern slavery will remaina priority for the UK’s ministers, business leadersand statutory agencies.

www.antislaverycommissioner.co.uk

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

CHAPTER 3: THE MODERN SLAVERY ACT: REQUIREMENTS
AND REPORTING“A significant proportion of companies are failing to take any substantive steps on modern
slavery and this is something I want to see changing fast. This is not a mistake, but a wilful
avoidance of their legal and moral responsibilities”
Independent anti-slavery commissioner Kevin Hyland
The Modern Slavery Act came into effect inJuly 2015.
The act:• Consolidates existing slavery and trafficking
offences from other legislation• Creates mechanisms for seizing traffickers’ assets• Creates a role for an independent anti-slavery
commissioner• Requires companies of a certain size to publish
a modern slavery statement (Section 54).

Transparency in supply chains reporting
Section 54 of the Modern Slavery Act requires
businesses with a turnover of at least £36 million to
publish a statement on the steps that they are taking
to combat modern slavery both internally and in their
supply chains. This includes subsidiary organisations
and franchises based in the UK, even if the parent
company is headquartered abroad.80
The government’s intention is to encouragetransparency, creating a “race to the top” of bestpractice. Companies are expected to build on theirstatements annually, showing improvements overtime.
All eligible companies must write a TISC or modern
slavery statement regardless of whether they have taken
any actions to combat slavery that year. The statementmust:• Be signed off by a director• Be approved by the board• Appear clearly on the company homepage.

80
81
82

Government tightens the reporting criteria
The Home Office published moderately stronger
worded guidance in October 2017.81• It shifted from saying companies “may” to “should
aim to” include elements such as anti-slavery
policies, due diligence processes, at-risk businessareas, and performance indicators in their reports.
• Firmer guidance on deadlines was given, advisingorganisations to publish statements within six
months of financial year end.
• It said that statements from previous years must be
available online, allowing progress to be tracked.
• It encouraged organisations below the £36 million
threshold also to produce TISC statements.

First cycle reporting
Although it is too early to draw definitive conclusions,the UK Modern Slavery Act is having an impact onsome businesses.
Roughly a year after the act was passed, a surveyof more than 70 major brands found that CEO
engagement with modern slavery had doubled.82
Furthermore, 77% of companies that participated in
the survey thought there was a likelihood of modern
slavery occurring in their supply chains.
There is currently no requirement to submit TISC
statements to a central register. However, two such
facilities are operating:
The Business and Human Rights Resource Centre
is running the Modern Slavery Registry. As of
March 2018, the registry was holding more than 4,700
statements published by companies in 27 sectors,
headquartered in at least 35 countries.

See Home Office guidance Transparency in Supply Chains: a practical guide, updated October 2017
Ergon, New Home Office guidance on Modern Slavery statements: What’s Changed?, 17 October 2017
Ethical Trading Initiative and Hult International Business School, Corporate Leadership on Modern Slavery, How have companies responded to the UK
Modern Slavery Act one year on?, November 201641

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TISCreport, created by social enterprise Semantrica,
claims to be the world’s largest open data register for
global supply chain reporting on modern slavery. Asof March 2018 it had collected nearly 7,000 statements.
Because many companies are producing umbrellastatements that cover their subsidiaries, TISCreport
calculates that this figure covers more than 9,500
UK-based organisations and more than 100,0000
organisations worldwide.

How is construction performing?

Who is reporting?

Ergon Associates analysed statements by 49
construction and building materials companies
from the Modern Slavery Registry in February
2017. Compared to other industries, Ergon said that
construction companies were “lagging behind interms of their disclosures.”85

Based on data from Companies House, TISCreport
calculates that there are nearly 19,000 active
organisations in the UK with a turnover of more than
£36 million.83
In early 2018, the social enterprise estimated thatnearly 8,000 companies that needed to publish astatement were overdue. This was based on the factthat the each organisation had gone through an entire
financial year following the passing of the Modern
Slavery Act with no visible publication of statementon their websites.
Reporting requirements are being interpreted indifferent ways. For example, many international
companies are only addressing their UK operations.
However, a significant number of companies outside
the UK are voluntarily producing statements. This iseither to comply with, or in anticipation of, legislationin their own jurisdictions or because they want totrade internationally. Many small organisations arealso choosing to write a report even if their turnoveris below £36 million.

In September 2017, TISCreport ranked construction
as a mid performer on reporting compared to otherindustries, with roughly 30% of eligible companies
in the sector publishing statements. This is on parwith mining and quarrying, manufacturing andaccommodation providers. But tightly regulated utility
sectors such as water and power are leading the way:around 45% had produced compliance documents.84

The consultancy found that the reporting tended tofocus on business structures and policies relating tomodern slavery. Other areas such as risk assessments,
monitoring, training and remedial action were hardly
covered.
In one of the worst cases, Ergon discovered five
separate companies had “almost identical phrasing
to explain their due diligence in relation to modern
slavery – in statements that otherwise provide very
little substance.”
This suggests that companies are using standard
templates or outsourcing the drafting of theirstatements to third parties.
Many multinationals are limiting the scope of theirreporting to the UK, missing the opportunity to assess
greater risk areas elsewhere in the world.
“Where construction companies do disclose risks,these relate primarily to recruitment, migrant andagency workers, non-payment of wages and otherhuman resources functions more generally...Theinherent risks involved in subcontracting are only
mentioned by one company,” said Ergon Director
Steve Gibbons.86
Stone supplier Marshalls is one example of bestpractice. Its 17-page statement sets out the company’s
journey: explaining how Marshalls is identifying its
high risk supply chains and compiling profiles for
all its sourcing regions. Marshalls explains how thisknowledge has informed staff education, procurement
policies and its work with suppliers.87

83

In the first quarter of 201884

TISCreport briefing at House of Commons, Modern Slavery Act Compliance, September 201785

Gibbons S.,What are construction and building companies reporting under the Modern Slavery Act?, February 201786

Gibbons S.,What are construction and building companies reporting under the Modern Slavery Act?, February 201787

Marshalls, Modern Slavery and Anti Human Trafficking Policy and Disclosure Statement, May 201742

Construction and the Modern Slavery Act

Pan-industry issues“I’ve seen too many slavery statementsfrom companies that say, essentially, there
isn’t slavery in their supply chains. Froma business point of view, this is either ahighly unusual business or a foolish one
that isn’t taking slavery seriously.”
Paul Gerrard, group policy and campaigns director,
The Co-op GroupIn general, the best TISC statements have been
produced by multinationals that are sensitive toconsumer and investor scrutiny. But evidence of bestpractice is still sparse.
BHRRC has praised Marks & Spencer, Sainsbury’sand Unilever as among “just a handful” of FTSE 100
companies that are “taking meaningful action”. By
contrast, 43 out of the top 100 listed companies have“failed to meet even the minimum requirements of
the act.”88
BHRRC executive director Phil Bloomer stated his
disappointment that so many companies are stilltaking a tick-box approach, adding:“Those that are leading the way prove there has beenenough time to act decisively to eliminate slavery fromtheir operations and supply chains.”
Anecdotal evidence suggests that many companies aretreating the drafting of modern slavery statements
as a discrete task, isolated from business operations,rather than a reflection of meaningful activities
carried out throughout the year. In the worst cases,
some statements are less than 500 words long.

Tackling Exploitation in the UK

Although government has yet to introduce penalties for
non-compliance, independent anti-slavery commissioner
Kevin Hyland wrote to more than 1,000 companies
in the summer of 2017, to encourage improvements inreporting.91 He has also warned that negligent companies
could face civil actions in the future.
TISCreport has been contacting all companies
that have not filed easily traceable statements, receiving
varying responses. CEO Jaya Chakrabarti MBE says:“We’ve seen statements that haven’t been signed by aboard director, statements hidden in privacy policies
and CSR statements and not linked to the homepage
as they should be. Some organisations have kept theirstatements deliberately incognito. Many are afraid to
use the term slavery or mention the act. In some of
the worst cases we have been sent a single paragraphburied in an annual report.”
She states examples of some companies writing astatement to cover a two year period, even though theyshould be writing a new statement every year. Other
organisations have published undated statements
which appear to stand for eternity.
TISCreport digitally tracks changes to publishedstatements and has collected more than 30,000
document iterations, which it believes account for
99% of all TISC statements in existence. In a worrying
trend, the social enterprise has found that a numberof published reports have been amended to remove
mention of activities perceived as risky.
Removing mention of risk is against the spirit of theact, as Justine Currell, the former senior civil servant
who led the drafting of the UK’s modern slavery
legislation, explains:

In an analysis of 150 statements across different sectors
published in March 2017, Ergon found only 11% had
disclosed specific cases where steps had been taken to
identify modern slavery risks.89“If you took ten steps, but only four had positive
outcomes, you should still mention all ten steps. If you
only mention the positive effects, you haven’t fulfilled
the requirements of the act.” 92

NGOs have criticised statements for lacking detail andbeing limited to broad descriptions of processes andactivities. Many simply do not comply with the law. Ergon
found that 21% of statements were not clearly signed
off by a director or equivalent and a quarter were notdirectly available from the company’s homepage. A lotof companies have no stated policy on what they should
do if they find a victim of slavery or forced labour.90
Some state boldly that there is no modern slavery in their
supply chain, an assertion that can be hardly credible forany organisation with a substantial turnover.

Ergon warns about the effects of complacency overthe long term:“Superficial and broad descriptions of processes andactions remain the norm for the bulk of reporters.
In this respect, as modern slavery reporting becomes
more routine, there is a danger that the default
position could be anodyne statements that deal onlyin generalities. This would run counter to the intentionof the act and is unlikely to meet the expectations ofregulators, civil society or increasingly, investors.”93

88

BHRRC, FTSE 100 failing to lead on eliminating modern slavery from supply chains?, 17 October 201789

Ergon, Modern slavery statements: One Year On, April 2017

90
91

Ergon, Modern slavery statements: One Year On, April 2017
Independent Anti-Slavery Commissioner, Annual Report 2016 – 2017, October 201792

See Justine Currell interview

93

Ergon, Modern slavery statements: One Year On, April 201743

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Campaigning ramps up
CIOB VIEW: It's time to be proactive
Most companies are in the first cycle of TISC
reporting and it is taking some time for industry
to find its feet. NGOs are noticing marginal
improvements in quality as the year progresses,
but a large proportion of statements still lacksubstance.
Moving into the second and third reporting
cycles, statements that follow best practicewill be building an annual narrative of
how organisations are mapping risk,
introducing remedial measures andmeasuring progress.
Those companies that are doing the bareminimum, or failing to meet legal obligations,can expect increased scrutiny. NGOs are ranking
and tiering the performance of organisations,and the poor reporting of some construction
companies is already on their radar.
Hoping that a statement can simply be buried ona webpage is futile. TISCreport is automaticallycollecting and compiling statements fromacross the globe. Its data systems will detect
when reports are removed and how much of thelanguage is being repeated year on year.
Retrospectively revising TISC statements is also
risky. TISCreport plans to make all iterations
available to researchers in the near future.
As well as the dangers of underreporting,overstatements – such as the assertion that theorganisation has no modern slavery issues –areequally likely to set alarm bells ringing for
enforcers and activists.
As yet, companies that have not published astatement have not been called out publicly.
TISCreport is remaining neutral and will not benaming and shaming companies.
But some clients are analysing reporting data aspart of their risk assessment for supply chains. In
addition, the authorities are increasingly likely
to view the failure to publish statements as anindicator of poor governance and a red flag fortriggering investigations.

44

The Modern Slavery Act has been criticised for its
lack of punitive measures and the fact that there isno obvious government plan to monitor company
performance. However, the act has many supporters
and crossbench peer, Baroness Young of Hornsey islaunching a campaign to encourage more in-depthbusiness engagement.
“It’s in the interests of businesses to try to make thiswork,” she says. “The act is a useful mechanism. I don’t
want to give up on it until we have exhausted every
possibility.”
For many commentators the next few months are
critical. Some business groups are already lobbying forthe £36 million reporting threshold to be lowered.
Other laws, such as the Bribery or Data Protection
Acts, carry substantial fines for bad business practice.
If industry fails to respond to the spirit of the act,
arguments for tougher legislation will only strengthen.

Will the Modern Slavery Act extend to
the public sector?
There were calls for the MSA to be extended to the
public sector even before it passed into legislation.
To many, it seemed obvious that local and national
government departments should conform to the same
reporting rules as businesses.
A number of publicly funded organisations,
including Transport for London, London Universities
Purchasing Consortium and some local authorities are
already writing their own modern slavery statements
on a voluntary basis.
Baroness Young wants to enforce wholesale adoptionof MSA reporting across all local and national
government departments, from the health service tothe armed forces.
Her original private members bill had to be dropped
last year after the snap election was announced. But
she has since introduced a second Modern Slavery(Transparency in Supply Chains) bill, which had its
first reading in the House of Lords on 12 July 2017.
The second reading is expected in 2018.

Construction and the Modern Slavery Act

The bill has attracted broad industry and party
support. As well as the Parliamentary Joint Committeeon Human Rights94 other supporters include the
British Retail Consortium, the Ethical Trading
Initiative, Anti-Slavery International, BRE and CIOB.
Baroness Young says;“Public bodies have an enormous amountof leverage through their contracts andthis is an opportunity to drive meaningfulchange at a local and national level.
“Whilst local authorities already havetheir own guidelines and regulations,accessing the information is a long andcomplex process. I’d like voters to be able
to go to their local authority’s homepage
and see a comprehensive and condensed
statement, in the same way they can now
do for a fashion retailer.”

94
95

Tackling Exploitation in the UK

CIOB VIEW: Public procurement
and construction
Construction accounts for a significant
proportion of government spend. In 2017,
twelve of the 20 top public sector suppliers wereconstruction companies. Their accumulated
contract awards and frameworks totalled morethan £18 billion.95
Extending MSA legislation across public
procurement could act as a major catalyst for
improved supply chain reporting and reform.
The legislation would incentivise tier one
contractors to access the hardest to reach partsof their highly fragmented supply chains. Major
construction companies could also play animportant role in supporting public sector bodies
as they review their procurement processes.

Parliamentary Joint Committee on Human Rights, Human Rights and Business 2017, Promoting responsibility and ensuring accountability :sixth report ofsection 2016-17, 29 March 2017
Sourced from Tussell: www.tussell.com, December 201745

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Legislation and the Modern Slavery Helpline
INTERVIEW: Justine Currell, executive director, Unseen
Justine Currell worked for the civil service for 28 years. In her last government role as modern slavery seniorpolicy adviser to the Home Office, she led on the drafting of the Modern Slavery Act.
Currell joined NGO Unseen in May 2016 to lead the development of the enhanced Modern Slavery Helpline
and Resource Centre.96 She advises businesses, law enforcers and governments around the world on modern
slavery, safeguarding and transparency in supply chains. She is also the deputy police and crime commissioner
for Bedfordshire.

Are you seeing evidence that theModern Slavery Act is changing
behaviours?
Yes, because it is requiring businesses to talk aboutmodern slavery and their role in tackling forced
labour. In fact, we’re getting many calls frombusinesses. They’re asking for more information
about the act and how they can be leaders intheir sectors. It’s demonstrating a really positive
approach.

What were your intentions for section
54 – the requirement for companies to
produce a transparency in supply chainsstatement?
We’ve kept it simple. We’ve asked organisations tolist all the steps that they’ve taken to address modern
slavery in their supply chains in that financial year.
But this requires companies to list everything thatthey’ve done. For example, if they took 10 steps,
and six had positive results, and four had negative
results, they should be reporting on all ten actions
not just on the six that turned out well.
Crucially, the statement must be signed off by adirector and approved by the board. I was reallykeen to include this requirement when drafting thelegislation. It means that the board has to set thetone and direction. Directors can no longer turn ablind eye to poor practice - the whole organisation
has to understand its obligations in tacklingmodern slavery.

96

46

For more information see www.modernslaveryhelpline.org

How is TISC reporting developing?
As companies get into their second year ofreporting, we’re noticing a marked increase in thequality of statements in many cases. I think this
could be down to peer pressure, as companies
become aware of what their competitors are doing.
This is what I was hoping for – a race to the top –but it’s still early days.

What most frustrates you aboutindustry’s response to the Modern
Slavery Act?
I attend a lot of business events with other NGOs,
and there are always one or two people in the room
who say everything needs to be done ‘right now’.
That was never the intention.
When we developed section 54, we wanted to see
organisations growing and performing better
over time, year on year recognising that not all
businesses are at the same point or level. Initiallyit’s about getting the board involved and starting
conversations with businesses that have probably
never had those types of discussions before.

So what’s your advice to companies?
Rather than thinking “how do we comply withsection 54?” Companies need to recognise that therisks are everywhere. They need to see this as akind of long game – to have at least a three to five
year strategy. It’s an ongoing issue and needs anongoing response.

Construction and the Modern Slavery Act

Some companies need to think about creating
more meaningful and productive statements. I’ve
seen a few sweeping announcements such as ‘wedon’t condone modern slavery’ and ‘we seek to haveno more slaves in our supply chain’. This is justnonsense that doesn’t really hit the mark.

What do you think of the calls for theModern Slavery Act to be amended?
When we were developing the legislation, I didn’t
want to make it too prescriptive, because I wasworried that this would become simply a tick-box
compliance exercise.
In my experience, the moment you put in a specificrequirement into any legislation, people do as little
as possible. I had lots of legal counsels saying tome: ‘what’s the minimum we need to do?’So I’m nervous that people are calling for changes
to section 54 before we’ve had a chance to gauge
its impact. We shouldn’t be judging it too quickly,
or tinkering with it too soon, because it will takea while to bed in. What we need to remember isthat this is a far reaching provision that covers all
business sectors so one size does not fit all.

Are there any legislative changes thatyou would like to see?
Legislation is a blunt instrument, it provides theframework for more action. I would be the first to
say that the legislation didn’t do enough for victim’s
services and protections. The government is now
looking at this, but there are many complex issues
around identifying and supporting victims andensuring that they get access to the right services,which cannot be included in legislation.

Tell us about the Modern Slavery
Helpline
The helpline is confidential and it’s developing
fast. Our call handlers are specialists from a very
diverse set of backgrounds such as social services,the police and the NHS. As well as understanding
modern slavery from all perspectives, they
understand the operational side of support andrehabilitation.

Tackling Exploitation in the UK

That helps us on the training and education front
as well: one of our other activities is training
up businesses and public sector agencies. We’reencouraging all organisations to use the helplineas the single point of contact for all modern slavery
issues in the UK. This not only improves the
response to modern slavery issues - it also allows
data and information to be collated and sharedwith other relevant organisations and agencies.

How many calls has the helpline beengetting?
We had around 3,500 calls in 2017, and predictthat this could rise to 6,000 calls this year. There’s
often a spike of activity after publicity campaigns.
We have a growing number of enquiries fromcompanies asking for advice and information.
We’re working really closely with the NCA, the
NHS, the Police, Border Force and NGOs topromote the helpline. Once people realise that it’s
independent and confidential, they’re more inclined
to pick up the phone. We work on a consent basis,
so we listen to and support what the caller wants.

Are you getting any calls relating to
the construction sector?
Yes, we’re getting some calls. Possibly not as
many as we would like, but this is about raisingawareness. The sector has many small businesses,
and it’s probably not on their radar yet.

Has anything surprised you about thecalls you get?
We get a lot of calls from people that are in directcontact with victims, as well as from victims
themselves. We weren’t expecting that so early in the
helpline’s development so that’s very positive news.

Call the Modern Slavery
Helpline on : 08000 121 700

to get help, report a suspicion
or seek advice

www.modernslaveryhelpline.org

47

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

CHAPTER 4: CONSTRUCTION’S RESPONSE TO THE MSAWhether the Modern Slavery Act will permanently shift business behaviours is still up for
debate, but there is no denying that it has started a national conversation.
The Chartered Institute of Procurement andSupply (CIPS) published a pan-industry survey ofprocurement managers in August 2017. In it, 10% of
respondents admitted to finding evidence of modern
slavery in their businesses or suppliers. Prior to thelegislation being passed, the figure was 2.7%.
However, a worrying 37% of procurement managers
admitted they had not read government guidance on
modern slavery.97

What do construction companies think?
A sample of the 77 construction procurement
managers that answered the CIPS survey provides aunique view of the impact of the Modern Slavery Act
on the sector.98
To the question, How certain are you, if at all, that
there is no modern slavery occurring within your supply
chain? 10% said that they were very confident and
48% were fairly confident that they did not have thisproblem.
This answer suggests that 58% of respondents haveconfidence in their systems and processes for spotting%

slavery. Superficially, this might look like a goodresult. In reality it is more likely to be an indicatorof overconfidence, or lack of understanding. There is
a common misconception that immigration checks– often referred to as right to work –will also detectmodern slavery. However, the two activities should not
be conflated, as discussed later in this section.
Complacency is an issue. Whilst some companies aredemonstrating leadership in tackling risk areas, others
are resistant to the idea that UK construction might
have a problem. At least one major contractor has
privately expressed the view that the new legislation isan unfair imposition on the industry.
In an irony that flips surveys of these kinds on theirhead, NGOs and academics are likely to give warmer
encouragement to the 24% who were ‘not very’, or‘not at all’ certain that there was no modern slavery intheir supply chains.
“If you think you have a system in place thatguarantees you haven’t got modern slavery, you’rein cloud cuckoo land,” says the University of Bath’s
Andrew Crane.

How confident are you that there is NO modern slavery in your supply chain?
Responses from construction procurement managers

35
30
25
20
15
10
5
0
Very confident

97
98

48

Fairly confident

Not very confident

Not at all confident

CIPS, One in three businesses are flouting Modern Slavery legislation – and getting away with it, 6 September 2017
CIOB would like to thank CIPS for generously sharing this sample of the anonymised data

Don’t know

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

How companies have responded to the Modern Slavery Act
This chart shows the major activities that construction companies have been carrying out in response to the Modern
Slavery Act, according to the CIPS survey. In the following section, we will examine them in more detail:16%

Undertaken site inspections

22%

Conducted minimum wage and immigration checks

25%

Introduced procurement policies complying
with the Modern Slavery Act

26%

Provided training to employees andsuppliers on slavery risks and compliance

26%

Mapped supply chains to understand risks

26%

Reviewed supplier contracts

28%

Sought assurances from suppliers thatthey are compliant with the legislation

30%

Completed a modern slavery statement

Comparatively poor reporting levels
30% have completed a modern slavery statement
Although this was the most popular activity, it
represents less than third of the industry and indicatesthat many companies are publishing statements late,or not at all.
Construction’s record is poor when compared to allindustries, where two thirds of companies had created
MSA statements. Many TISC statements do not meetbasic compliance criteria, as discussed in the previous
chapter.

Sharp practice and compliance letters
28% have sought assurances from suppliers that they
are compliant with the Modern Slavery Act and 26%
have reviewed supplier contracts“MSA legislation presents a positive opportunity
for major contractors to work with supply chains to
reduce risk both for labour and product procurement,”
says Jacqueline Glass, professor of architecture andsustainable construction at Loughborough University,“after all, they are heavily reliant on their suppliers todeliver these initiatives.”

But growing evidence suggests that many largeorganisations are pushing risk onto their less wellresourced suppliers. Some organisations have been
writing a “zero tolerance” approach to modern slavery
into their contracts. This goes against good practice:
as well as forcing companies to cover up the problems,
it could act as an enabler for criminals to move on toother companies undetected.
“Unless a company has obviously been acting illegally,or with criminal negligence, treating an incident ofmodern slavery purely as a breach of contract, and thereason to terminate a business relationship, is more
likely to push the problem underground,” says Helen
Carter, senior consultant at Action Sustainability andthe Supply Chain Sustainability School.
She adds that collaboration is essential.
“We need to get out of that mindset that modern
slavery is a compliance issue. Organisations won’t
know what’s happening below tier one unless they ask
the right questions. Suppliers need to be comfortableenough to ask for help.”
This view is echoed by some major contractors:“We want to engage with our supply chains in apositive way. Rather than ending up having to deal49

Construction and the Modern Slavery Act

Tackling Exploitation in the UKwith something once it has gone wrong, we want tobe more engaging and collaborative to avoid getting
to that stage in the first place,” says Alice Hands,
sustainable procurement manager at Sir Robert
McAlpine.99
Skanska has also said that it will reengage with
suppliers that show a willingness to improve.
“Recently one supplier came back to us andacknowledged that they needed to make changes. We
supported them, and had some initial discussions
about how they would do this. Now we’re working
with them again, they’re the subject of regular audits
to ensure that they are doing what they promised,”says Harvey Francis, group HR director and executive
vice president at Skanska UK.100
While these behaviours are encouraging, evidence
suggests that other companies are taking a more
confrontational approach, particularly in the area ofmaterials procurement.
The dilemma of Marshalls illustrates the problem.
The hard landscaping products supplier has received
international recognition for its initiatives to tackle
the risks of forced and child labour in its international
supply chains. It has spent more than a decadere-engineering its business model around ethicalpractice, whilst addressing the social, cultural andeconomic causes of slavery in high risk regions.101 Yet
the company’s group marketing and sustainability
director Chris Harrop complains that he frequently
feels compromised by requests to sign the complianceletters that land on his desk.

“We’ve been receiving up to threequestionnaires a week, with threats that
we will be delisted if we can’t guaranteethat our supply chains are slavery
free. As a responsible business, we areunable to sign, because apart from theself employed, no one can make thosekinds of promises. It feels like a totally
redundant exercise.”102

99
100
101
102

50

Loughborough University’s professor Jacqueline Glass
agrees:“This approach by major contractors and clients is aworrying trend that is wrong on so many levels. It’s
sharp practice, manipulative and bullying behaviour,and completely against the spirit of the Modern
Slavery Act. No one can, or should be impelled, tosuggest that their supply chains are ‘slavery-free’ –the point of the act is to demonstrate responsibility
towards the eradication of slavery.”Training and awareness programmes
26% of companies have provided training to employees
and suppliers on slavery risks and compliance
There is evidence that training is already raisingskills and competencies in fighting modern slavery. A
growing number of contractors and clients are signingup for Stronger Together training, which has a proventrack record in the retail sector. Many construction
businesses are using training materials and videos
developed by the Supply Chain Sustainability School,
which partners with more than 65 constructionindustry clients and contractors, and has 25,000
registered members.
Professor Jacqueline Glass says:“The school is a good example of how major
contractors, clients and major stakeholders are coming
together to influence and educate their supply chains.
The advantage is that suppliers will get a consistentmessage, whichever supply chain they are working in.
However, many contractors are not connected to theschool –so it’s more difficult to find out what they are
doing.”
CIPS data suggests that construction lags behind othersectors on training. Just over 25% of construction
companies had provided training to employees andsuppliers on the risks of slavery, compared to a generalindustry average of 41%. And roughly a third of
respondents said that they would not know what to
do if modern slavery was found in their businesses or
supply chains. This was significantly higher than the
16% average across all industries.
When the managers were asked if they were confident
in their own or their staff’s knowledge to tackle
modern slavery in their supply chains, 50% did notthink the business had adequate skills. Once again,
this was worryingly more than the already high crossindustry average of 38%.

See Sir Robert McAlpine case study
See Skanska case study
See Marshalls case study in CIOB, Building a Fairer System, Tackling Modern Slavery in Construction Supply Chains, July 2016
See Marshalls case study in this reportConstruction and the Modern Slavery Act

Tackling Exploitation in the UK

Are you confident that you or your staff have sufficient knowledge% and training to tackle slavery in your supply chain?
35
30
25
20
15
10
5
0
Very confident

Fairly confident

Not very confident

Risk mapping is underway, but will ittranslate into policy?
26% have started mapping their supply chains“Risk assessment has become a bit of abuzzword. People assume it’s all they needto do, rather than take action.”
Helen Carter, senior consultant, Action Sustainability
and the Supply Chain Sustainability School
Mapping out risk in supply chains is one of the firstactivities recommended by supply chain specialists.
This is would be a complex undertaking in any sector:
CIPS reported in 2016 that 72% of businesses had no
visibility beyond tier one suppliers.
But construction has the added challenge that its
supplier base can change dramatically from project
to project, transforming again within joint ventures.
Nevertheless, a number of clients and contractors are
beginning to explore risk mapping.
From a supplier perspective, Marshalls took an
early lead by launching its Ethical Risk Index insummer 2017. Risk ratings for all its stone products (acombined score of country information, independent
audits and scoring systems) appear next to productson the Marshalls website. They are designed to help
buyers make more informed choices.103

103

Not at all confident

Don’t know

The Supply Chain Sustainability School’s special
interest slavery group recently analysed the journeyof four commonly used products: plastic bags, a hivis vest, a cleaning product and steel reinforced bar(rebar).
Just taking the example of the hi-vis vest shows
the complex origins of one supposedly simple
item. Although the many of the elements were
manufactured in factories across China, and thefinal product created in Morocco, the elements went
on long and carbon-hungry journeys. For example:
The fabric was sent from India to the UK, then toGermany for dyeing and finishing, before ending up in
Morocco. The reflective tape was sent from the USA to
Germany for cutting, then sent to the UK before being
dispatched to North Africa to be added to the final
product.
The school has merely provided the information about
these products, it is now up to the members as to how
they respond and adapt their policies.
“Many companies are doing their own risk mapping,”
observes Helen Carter. “But we’re noticing that there isa big gap between those that map risk and those who
actually use this information to drive policies into the
supply chain.”
Extending this activity to the thousands of materials
and products and millions of components within themis an overwhelming undertaking for any company tocarry out alone. It poses the question, if companies
came together to collaborate, could they also use their

See also Marshalls case study

51

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

combined power to accelerate improvements acrossthe industry?
Opinion is divided amongst the contractors. Some
prefer to engage only with their supply chains. Others
are open to working with peers.
Mace is using information sharing platform Sedex
to better understand its supply chains. It is alreadycollaborating with client Heathrow around theplatform and is keen that more clients and contractors
sign up. One advantage, says the company's head ofsustainability for construction Ross Wood, is that thiswould reduce the burden on suppliers as they would
only have to submit information once.
Wood is hoping to be able to trace every component
on a Mace project back to its origins.
“We want to get to the point where we can break every
item down to its raw materials. For example, once
we know how a cladding supplier sources its glassand rubber, we can link then link through to those
production plants. We’re hoping that Sedex will help
us engage faster with the lower tiers,” he says.
He believes that major contractors could use theplatforms like Sedex to address issues with common
suppliers.
“I’d like to think that as an industry we could cometogether to solve some of our systemic problems.
I don’t see this as a business differentiator.”104

Procurement reform gets off to a slow
start
25% have introduced procurement policies complying
with the MSA
According to the CIPS survey, only a quarter of
construction companies have introduced procurement
policies complying with the Modern Slavery Act.
As procurement teams are in a powerful position tocollaborate with suppliers and implement change, thelack of reported action in this area is concerning.

Standard105; Balfour Beatty was the first contractor
to have completed assessment against sustainableprocurement standard ISO 204000, and Lendlease iscurrently aligning its procurement strategy with thesame standard.106
Andy Fulterer, director of Lendlease’s European
systems and policy team is one of many calling for more
standards to increase the traceability of products, suchas FSC for timber, or BES 6001 for brick and rebar.
“We’re happy to put our weight behind an industry
standard if it’s creating the right momentum andreducing effort for all of our suppliers. People have
limited resources, if we can agree on a standard, it
could make everyone’s life easier,” he adds.
Many contractors have beefed up modern slavery
and business ethics sections of their prequalificationquestionnaires. Carter believes that the questions
will gradually become more sophisticated as modern
slavery issues become better understood.
“Over the past ten years, industry’s response tosustainability has matured considerably, powered inpart by programmes such as the London 2012 Games.
We anticipate that business ethics will follow a similar
trajectory, as companies build on their knowledge,
asking more intelligent questions and creating
sophisticated mechanisms,” she says.

Crackdowns on illegal immigration
continue, but are they missing slavery?
22% have conducted minimum wage and immigration
checks“Companies often check the wrong thing
in their audits – such as right to work.
This may not be the right thing to do ifthey’re looking for slavery”
Construction compliance director

Carter warns companies against trying to deal withmodern slavery in isolation, adding: “Initiatives thatconflict with standard internal practice will quickly
fail.”The government is placing two somewhat conflicting
responsibilities on industry: checking for signs of
exploitation and enforcing immigration policy.
Sometimes the two activities are being conflated into
one, with priority given to immigration checking.

Examples of best practice include embedding
sustainability frameworks and ethical labour
standards into business models: Sir Robert McAlpine
is the first contractor to pilot BRE’s Ethical Labour“There’s a definite tension between those two goals,
as one [clamping down on illegal immigration]
can create conditions for the other. It’s a challenge,
although not impossible, for companies to tackle both

104
105
106

52

See Mace case study
See Sir Robert McAlpine case study
See Lendlease case study

Construction and the Modern Slavery Act

things at the same time,” says the University of Bath’s
Andrew Crane.
As he points out, right to work checks will not often
yield the right data to detect slavery.
Many people trapped in unfair working conditions,from modern slavery to minor exploitation, have alegitimate right to work in the UK. Some are British,others from Commonwealth or the 27 other European
Union member countries.
The government’s focus on immigration is expected
to intensify as Britain prepares to exit the EU. New
restrictions on movement could put migrant workers
at higher risk of exploitation. As Crane points out,
exploiters are already using immigration laws toengineer vulnerability in workers, whether throughmisinforming them of their rights, or deliberately
waiting for a visa to expire.107

Tackling Exploitation in the UK

Crane warns that while fraudulent documents are notnecessarily evidence of exploitation, they are often
overlooked as a potential indicator of risk.
“There is a danger that people could be prosecuted
simply for having or issuing fake documents, with noinvestigation into the conditions in which they were
procured or used.”

Wage checks increase
22% have conducted minimum wage checks
Checking that right wages are being paid across alllayers of subcontracting would be a major challenge
for any business. However, it is likely that the industry
will need to develop stronger capabilities in thisarea. Increasing numbers of clients are demandingthat the living wage is paid. Major organisations aredemanding more transparency from their suppliers.

Carter adds that while many companies are tightening
their checks on labour agencies, there is a more hidden
risk of criminals infiltrating construction sites throughsubcontractors. Organised gangs, she suggests, could
be taking advantage of a sudden demand for labour as
projects battle to stay on schedule.

The UK’s largest commercial property company Land
Securities has committed to ensuring that employees in
all its environments, including on construction sites,
will be paid wages set by the Living Wage Foundation
by 2020. More significantly, the client will be asking
contractors to demonstrate that this is taking place.

On many sites, responsibility for labour checks often
falls to subcontractors that are less well resourced
and less likely to have expertise in spotting fakedocuments.

“We’ve added clauses to our contracts to make thisrequirement clear, asking them to confirm by sending
a letter that they’re paying wages as set by the Living
Wage Foundation. But now is the time to provide
evidence to prove that it’s happening on the ground,”says Edward Dixon, sustainability insights director at
Land Securities.

Anecdotal evidence suggests that, despite strong
checking regimes, fraudulent identity documents arestill being found on some major construction projects.
There are still cases of subcontracted workers being
paid cash in hand.
In a survey by the Considerate Constructors Scheme,
more than a third of respondents believed illegal
workers had been present at an existing or previous
employer, 81% believed that it had been on the rise forthe past 15 years, while 93% thought the crime could
be better tackled.108“A foreign national in the black economy can buy
a fake passport for £500, then use it to apply forother documents. Once they have a reference froman established company, they become increasingly
difficult to detect,” says a government insider. “At
the same time, building company administrators
are expected to become expert in hundreds ofnational identity documents. It’s a huge challenge
for industry.”

107
108
109

Enhanced site inspections and worker
engagement
16% have undertaken site inspections
This low figure suggests that much of the industry
has yet to develop a strategy for site inspections thatencompass human rights. However, in one example
of best practice, Great Portland Estates (GPE) piloted
worker engagement interviews on six central Londonsites in 2017.109
GPE now plans to roll out worker engagement
interviews across all construction and refurbishment
projects and expects the questions and techniques to
evolve over time.
Some companies are complementing their standard
auditing processes with informal engagement andCrane A, LeBaron, G, Allain J and Behbahani L., Governance gaps in eradicating forced labour: from global to domestic supply chains, September 2017
CCS, The Scheme launches campaign to tackle illegal working in construction, March 2017
See GPE case study53

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

conversation. As part of Skanska policy, every
member of its of the 20-strong senior management
team conducts a formal site visit every month, and it’s
not unusual for major projects to receive leadership
visits on a weekly or bi-weekly basis.
“It was originally an executive health and safety
visit. We’re now having broader conversations, asking
workers how they are being treated by Skanska andtheir employers,” says Harvey Francis, group HR
director and executive vice president at Skanska UK.110

Hotlines and remediation programmes are
in development
All companies interviewed by CIOB have launched or
taken part in modern slavery awareness campaigns.
Some companies have introduced whistle blowing
hotlines. But anecdotal evidence suggests that manyorganisations have yet to implement procedures todeal practically with reported incidents.
In one example of best practice, Marshalls has signed along term agreement with Hope for Justice. The NGO
is not only delivering training to internal departments,
clients, installers, and labour agency providers, it isalso helping Marshalls develop a remediation strategy
for addressing any reported human rights issues acrossits sites.

“We’re taking a flexible approach, on a case by casebasis. Working with Hope for Justice enables us tohave options rather than a standard process,” says
business and human rights lead Elaine Mitchel-Hill.

Construction backs labour market
enforcement
61% of construction procurement professionals backtougher labour enforcement legislation
Should major companies be held liable for labour
abuses committed by their suppliers, such as
minimum wage violations?
Industry is often resistant to extra legislation, but 61%
of construction procurement professionals in the CIPS
survey backed tougher laws, with 69% believing that
it would help to combat modern slavery. Just over halfof respondents thought that that new legislation would
reduce the amount of labour abuses taking place in the
UK generally.
Other popular reasons cited were that legislation
would force companies to scrutinise suppliers morethoroughly, and encourage board members to take abigger interest in supply chain management.
However, 20% feared that this could make audits
prohibitively expensive.

What effect would labour market enforcement have on your business?
Top answers from construction procurement professionals:

6%

110

54

See Skanska case study

I expect my business would be fined
under these rules

14%

We would have access to higher quality products

18%

It would improve our relationship with suppliers

20%

Auditing our supplier’s labour policies
would be prohibitively expensive

30%

It would encourage board members to be
more involved in supply chain management

44%

It would encourage us to scrutinise
our suppliers more thoroughly

52%

It would help to reduce the number of labour
abuses taking place in the UK69%

It would help to combat modern slavery

Construction and the Modern Slavery Act

Cracks in the auditing process“Many companies are undertaking oneoff audits but they must realise this will
be an ongoing issue needing continuous
diligence checks: just because yourworkforce and supply chain are free fromforced labour today, it doesn’t mean it will
be six months from now.”
Independent anti-slavery commissioner,
Kevin Hyland
One of industry’s responses to the Modern Slavery Act
has been an increase in auditing for labour as well as
materials. Auditing is important for benchmarking,building knowledge and raising standards. But its
effectiveness in detecting modern slavery depends on
the quality of approach, along with the intention andcommitment of the client.
This is especially important in construction where
the fluctuating workforce can cycle through projects
at such speed that even regular audits are unlikely toconnect with the same workers twice.
Getting reliable data out of audits can be a challenge
anywhere. A study of 44,383 social audits across 47
countries found that recording violations “might beinfluenced by financial conflicts of interest and thecompetence of auditors.”111
It is often acknowledged that bribery and extortion
can disrupt audits in developing countries. But softer
forms of corruption are also distorting reportingin the UK’s construction and food processing
sectors, according to a recent research paper. 112 The
researchers suggested that this “appeared to contributemost to the persistence of forced labour in the UK.”

111
112
113

Tackling Exploitation in the UK

Identifying that forced labour was most prevalentat and below tiers 4 and 5 of subcontracting supply
chains, the report blamed audit protocols for limiting
detection and reporting of exploitation. It also citedmodern slavery incidents discovered in workplaces
that had recently passed audits. Auditors were:“…implicitly or even explicitly encouraged
to not detect incidents of forced labour.
As one social auditor described it, many
auditors are ‘not trying to find things out,
they are trying to prove that something is
not there’.”The commercial model is partly to blame. Many
auditors are so financially reliant on their clients, they
are not incentivised to report criminal activity to theauthorities. Taking the hypothetical scenario that aproblem had been uncovered, one social auditor told
researchers:‘We would have to work with the commissioning
company on that to decide how they wanted to play
it because…unless you have real evidence that thelaw is being broken, you really cannot start going to
the authorities, not if you want to stay in business,anyway.’113
Audits that are booked in advance present anotherproblem. One social auditor said that it had been a“standing joke” that you could go to a local theme parkon a weekday and see:“..Loads of illegal workers who had been
given the day off by their employers, andall the difficult ones who were likely to saythings to the auditors.”

Toffel, M, Short J and Ouellet, M., Codes in context: How states, markets and civil society shape adherence to global labor standards, 2015
Crane A, LeBaron, G, Allain J and Behbahani L., Governance gaps in eradicating forced labour: from global to domestic supply chains, September 2017
Crane A, LeBaron, G, Allain J and Behbahani L., Governance gaps in eradicating forced labour: from global to domestic supply chains, September 201755

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Lead author Andrew Crane says:“All our evidence suggests that companies,
however well meaning, cannot realistically
identify the nature of exploitation that’s
happening five levels down a supply
chain, through another five levels of
subcontracting. When planning audits,
companies face a dilemma. Do they want
to demonstrate that they are ‘clean’ or
do they want to solve the problem ofmodern slavery?”56

But Crane says that some consultancies and social
auditors are beginning to recognise the limits oftraditional audits, and are taking action to addressthem.

“Those following best practice are
identifying areas of high risk, interviewing
workers in their own language, sometimes
tracing them back to their countriesof origin.
“Some are trying to understand the stories
of workers, rather than simply relying on
box-ticking exercises. This is importantbecause it’s a question of building
understanding rather than meetingcompliance.”

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

CHAPTER 5: CHANGING THE MODEL
All industries face complex challenges in cleaning up their supply chains. This is
acknowledged by legislators and law enforcers. But whilst companies are not expectedto achieve radical change overnight, independent anti-slavery commissioner Kevin
Hyland is looking for evidence that they are taking meaningful steps towards continual
improvement.
The following chapters explore potential pathways
towards sustainable change.

Modern slavery and reputation
management
Reputational risk is the most compelling incentive forcompanies to take action on human rights abuses. In a
2016 survey of major brands, 97% of senior managers
said that protecting corporate reputation was thebiggest driver for supply chain improvements. The
survey also found that CEO engagement with modern
slavery had doubled since the introduction of theModern Slavery Act. 114
Anxiety crosses all industries. The survey found that:“Companies are extremely cautious about how muchthey should share publicly about the risk of modern
slavery...They worry that campaigning NGOs andthe media will exploit this to name and shame thecompany...” 115
Apart from the house building sector, construction
has less direct interaction with the general publicthan many consumer brands. Nevertheless, 70% ofconstruction procurement managers believe that
reputational damage would be the most significant
effect on their business if modern slavery was found intheir supply chains.116

Driven by fear
Fear of risk to reputation can have negative as
well as positive consequences. On the plus side, itcan encourage organisations to become proactive.
Conversely, directors may try to cover up evidence,
become defensive or avoid looking for problems at all.
Corporate nervousness can be seen in the numerous
legal departments watering down MSA statements.117

As well as removing any negative findings on risk,
anecdotal evidence suggests that organisations are
avoiding mention of positive steps that they havetaken, for fear that the information could be usedagainst them at a later date.
“There is a general reluctance to announce any
initiative until successful remediation has takenplace,” says one corporate insider.
Dr Alexander Trautrims of the University of
Nottingham’s Rights Lab is calling for a culturechange.
“Companies need to feel more comfortable about
being open. They should be proud when they detectproblems. It shows that their auditing and complianceregime is working.”

Opening Pandora’s box
Few leaders are as forthcoming as businessman andphilanthropist Andrew Forrest. Forrest is the former
CEO and current non executive chairman of Fortescue
Metals Group in Australia. He is also co-founder ofthe global anti-slavery organisation, the Walk Free
Foundation.
Instead of waiting for systematic audit of his 3,500
suppliers, Forrest demanded they sign an affidavit,
forcing them to disclose whether they had modern
slavery in their supply chains.
Suppliers were told that if they came forward,
Fortescue would work with them to resolve theproblem without penalty. But if they hid theirproblems they would be cut from his supply chain, andpublicly “barbecued”.
The process flushed out 12 suppliers and Forrest
discussed his supply chain challenges in public,
explaining the appalling conditions he had witnessedas he visited mining companies around the world.

Ethical Trading Initiative and Hult International Business School, Corporate Leadership on Modern Slavery, How have companies responded to the UK
Modern Slavery Act one year on?, November 2016
115 Ethical Trading Initiative and Hult International Business School, Corporate Leadership on Modern Slavery, How have companies responded to the UK
Modern Slavery Act one year on?, November 2016
116 Based on sample of construction procurement managers in the CIPS survey, carried out Summer 2017
117 See Modern Slavery Act reporting section
114

57

Construction and the Modern Slavery Act

Tackling Exploitation in the UK“[They had] a life expectancy of five years and food
which just kept them alive…18 to a room which you
wouldn’t call your larder…and not able to leave...
That company was supplying goods to us and othercompanies all over Australia....We all had slavery in
our supply chains,” he said.118
This is an inspired move in a country that is still
drafting its modern slavery legislation. In bringing his
supply chain into public view, Forrest has helped tojumpstart a discussion with businesses and citizens.
In Britain, corporations have shown more reticencein talking about systemic slavery problems. But Paul
Gerrard, policy and campaigns director at the Co-op
Group, is calling for more open discussions.
In a recent Co-op survey with the general public, 35%of respondents said that they didn’t believe that slavery
was happening where they lived, and 68% said thatthey would not know what signs to look out for. Nearlya fifth claimed not to have heard of modern slavery atall.119“I’ve been speaking at events up and down the country,
and even the professional people are constantly
amazed that slavery exists. Companies have a role toplay here. We need to help people understand thatcriminals are trying to put slaves into supply chainsof all the goods and services that they buy. Businesses
need to talk about how they are managing that risk,”
he adds.
The Co-op has an extensive ethical food trademonitoring programme that covers 1,773 sites withmore than half a million workers. In recent years, it
has expanded its reach to include tier 2 suppliers in
70 countries and is carrying out targeted activities
on highest risk supply chains.120 The Co-op reported
that it had identified a risk of child labour in its supply
chains on six occasions in 2016.
“By identifying risk we can do something about it,
and we can work with other partners to address the
problem. Any business that thinks it can solve theproblem on its own is foolish,” Gerrard says.
UK construction has so far escaped many of thematerials-sourcing scandals that have hit othersectors. This might be because enforcement agencies
are only just beginning to explore the sector’s complex
labour supply chain relationships. It might also be thatNGOs are more focused on tracking the journeys of
consumer goods.

118
119
120
121
122

58

But buyers should beware that building-relatedmaterials are already coming under scrutiny in othersectors.

When a problem is uncovered, what then?
In 2017, high street retailers Habitat and John Lewis
withdrew a range of granite worktops sourced from
Andhra Pradesh in southern India121 after a Dutch
NGO published a report on human rights violations
including debt bondage, child labour and unsafe
working conditions in the region’s quarries. 122
John Lewis told the Observer newspaper that “in lightof this report and pending further investigation, we
have made the decision to remove [the granite] fromsale ....and are currently investigating all granite
sources worldwide.”At present, it is unclear whether these popular
brands have permanently disengaged from stone
suppliers in the region. Cutting ties may seem likea logical corporate reaction, but Trautrims warns
that organisations should focus on due diligence andremediation first, as disengagement from suppliers
risks leaving victims in an even more precarious
situation.
“An organisation’s first priority should be to offer
remediation, working with suppliers to improve.
Companies should only walk away if suppliers areunwilling to improve conditions,” Trautrims says,
adding:“Brands withdrawing from vulnerable regions cancause major economic damage. It can result ingovernments viewing anti-slavery initiatives in theircountries very negatively. This can act as a further
block to progress.”
Gerrard comments that media needs to take more
responsibility on how it reports stories, as responsible
and negligent companies are being tarred with thesame brush.
“There are many UK companies that are working
desperately hard to do the right thing. But they
are being named and shamed in the same way as
businesses that don’t take the problem seriously.
“More responsible journalism is required. We need toencourage proactive organisations to be more open
about the challenges that they face.”

The Guardian, We had slavery in our supply chains says Andrew Forrest, 6 April 2017
The Co-op, Modern Slavery is happening right now, yet 1 in 5 Brits unaware it exists, 18 October 2017
The Co-op, Co-op Modern Slavery and Human Trafficking Statement 2016, April 2017
The Guardian, John Lewis and Habitat withdraw granite worktops over slavery concerns, 3 September 2017
India Committee of the Netherlands, Stop Child Labour and Kerk in Actie, The Dark Sites of Granite, August 2017

Construction and the Modern Slavery Act

CIOB VIEW: Changing the narrative
We need to work together, as an industry and as
a nation, to change the narrative around modern
slavery.
Exploitation thrives best in the shadows.
A culture of corporate silence and swiftly
terminated contracts enables criminals to target
other unwitting businesses. And PR paralysis
is unlikely to protect business image over the
longer term.
If it can be acknowledged that modern slavery,or exploitative labour practices, have infiltrated
most supply chains, companies should be
more open about their incidents and risks.
However, priority must be given to supporting
prosecution cases and protecting victims before
all information is made public.
Clients should also rethink how they frame theirtender process. At present, companies being
open about the risks of modern slavery in their
supply chains could score more poorly thanthose denying that they have a problem. Moreacute questions, such as asking what systems
companies have in place to detect modern
slavery, how they are dealing with incidents, andhow they are identifying their areas of risk, arelikely to encourage a less defensive conversation.
And it is a conversation that we desperately needto have with the media, to the general public,
NGOs and clients.
There is, of course, a bleaker alternative:
companies lie low and wait for disaster, in theform of court case, site shut down, media exposé
or damning NGO report to hit them first.

Tackling Exploitation in the UK

LEARNING FROMOTHER SECTORS:RETAIL AND
MANUFACTURING
amfori: when buyers collaborate on
remediation123
Imagine a situation where human rights abuses arefound in a factory in South Asia. Within 24 hours,
alerts are sent out to all the factory’s major clients.
Within 72 hours, representatives from all parties areon a conference call, collaborating and agreeing on
the best forms of remediation. No client disengages
with the supplier. Instead, the factory is given support
and training. Progress is monitored collectively bycustomers over the following months.
This is standard policy for amfori, formerly theForeign Trade Association. Based in Brussels, amfori
has more than 2,000 members, including many
European-based retailers, brands, importers andagents. Its members’ supply chains encompass morethan 50,000 factories and farms in 107 countries.
amfori BSCI (the organisation’s social performanceservice) has been issuing zero tolerance alerts
since 2015. This is when an auditor reports flagrantviolations in one of four high-risk areas, ranging fromchild labour, to forced labour, imminent health andsafety concerns, or unethical behaviour. Unlike othersectors, where the term zero tolerance is seen as areason to terminate a contract, the phrase is a callto action.
“At most I’ve seen over 30 members linked to
one factory, but the average tends to be five or six
companies,” says Andrew Martin, who heads up
monitoring and continuous improvement at amfori.
Even though the buyers are often competitors,
collaboration between them is strongly encouraged.
“Sometimes a member has more leverage than otherswith their suppliers. For example, if they have a local
office in the region, they could go and visit the factoryon behalf of all clients,” Martin says.
He gives a recent example of workers being issued
a limited number of cards to access toilet facilities.
If they used the toilet without using a card, money
was deducted from wages.

123

For more information see www.amfori.org

59Construction and the Modern Slavery Act

Tackling Exploitation in the UK“This was indicating a slide towards
forced labour, because the factory
was starting to control the movement[through] restrictions.” Martin says.
“Through engagement, the producer
now understands the violations and has
systems in place to stop this happening.”
Since the initiative was launched in 2015, the numberof zero tolerance cases has been steadily increasing,year on year.
“We had 20 cases in the first year, 53 in 2016 and 81
in 2017 . We see this as positive as we’re finding realissues. The crucial part is that we’re supporting theauditors, who can have a very difficult time. We needto give them the courage and freedom to use theirjudgement wisely and speak up if they find something
wrong,” Martin says.
The association’s oversight of the auditing process iscritical to the success of the zero tolerance approach:all members must use auditing companies approvedby amfori; auditors must be trained and qualified by
the association; auditors must also share all their data,
uploading reports directly onto amfori’s database.
Significantly, members are unable to de-link fromtheir supplier on the amfori IT platform for a fixed
time period while a zero tolerance alert is ongoing.
This is to ensure that an effective remediation process
is collectively established.
“We measure members’ individual engagement withthe zero-tolerance protocol through four specific
KPIs, including engagement in the process, andimprovements at the supplier,” Martin says.
In order to reinforce the integrity of its overall
programme, amfori sends out warning letters to
between 40 and 60 poorly performing members
annually as part of its formal member engagement
review.
Punitive action is also taken against auditing
companies that consistently fail to deliver to therequired standards. Actions, following extensive
investigations, range from warnings to sanctions or
potential terminations.
To further strengthen its processes, amfori is launchinga comprehensive audit integrity programme for auditing
firms. It has recently appointed KPMG to manage thequality and consistency of member audits globally, using

124

60

NCA, National Strategic Assessment of Serious and Organised Crime, 2017

data analytics. The association is also using the data from
20,000 annual member audits to develop training andeducational tools for supply chains.
“We’re working on our educational and audit data to
see if there are connections between capacity building
and improvements in audit results,” Martin says.
But he emphasises that choosing when and how to betransparent is essential for building trust.
For example, members use the amfori database to
map their supply chains, but only discover which of
their peers shares the same farm or factory outlet if
a specific disclosure protocol is followed. Similarly,
suppliers are allowed to undergo remediation in
private: only direct clients, linked through amfori’s
database, are made aware of the problem.
“We give suppliers time to get their house in order.
There is often a time lag of a few months before wepublish remediation case studies,” Martin says.

Fighting fake recruitment“....modern slavery and human trafficking
offenders are most likely to recruit victimsof trafficking online; the prevalence of
these methods is highly likely to increasein the coming three years.” 124
National Crime Agency
Dishonest recruitment is the most obvious entry point
to labour exploitation. Networks of unscrupulous
agents span countries and continents, promising goodwages and a better life. They trap the vulnerable into
unsustainable debt through inflated and illegal fees.
Migrant workers are often initially recruited by people
from their own communities before being passed on
to larger agents. At grassroots level, recruiters can holdpositions of trust in towns and villages and are known
to friends and family.
But online recruitment fraud is growing fast, bothin the UK and abroad. The worker never meets theperpetrators and is lured by appealing job adverts. Heor she could pay substantial sums for real or imaginedcosts, before discovering that a job does not exist.
In the year 2015 – 16, more than 1,200 employment
scams were reported to SAFERjobs, a UK initiative
to fight fake recruitment. This was a 300% increaseon the previous year. The number of reports dropped

Construction and the Modern Slavery Act

to 792 in 2017,125 possibly as a result of awarenessraising campaigns. Nevertheless, this figure should
be seen as a fraction of online recruitment crime.
Many people are too embarrassed to admit to being
scammed, or are unaware that they can ask for help
or redress.
Although the bulk of reported crime relates tofinancial fraud, the links to modern slavery should
not be discounted: many victims are vulnerable,
particularly if they have travelled to their ‘job’ fromoverseas and are in debt. In addition, anyone who istricked directly into modern slavery through a bogus
job advert may never be in a position to report it.
A Government insider says:“We see quite a few situations where
people are tricked by agencies. They buy
visas at hugely inflated rates, believingthat they need help entering the UK when
in fact they could go through legitimate
routes at a fraction of the price.”
He adds that people can believe that they are buying
genuine work visas, but receive study visas instead,with no right to full-time work.
“They’ve spent a lot of money to get to this country
and land here in a very vulnerable situation. Withlimited work choices they’re in danger of falling into
the black economy.”
In Scotland’s first successful human trafficking case,Shamsul Arefin was jailed in 2015 for exploitation ofseveral Bangladeshi men in a remote Scottish hotel.
One victim, Abdul Azad, had answered Arefin’s bogus
advert to work as a chef in a tandoori restaurant in
London. Instead, on arrival at Heathrow, he was told
to board a bus to Glasgow.
He was one of several chefs tricked into forced
labour at the hotel. Arefin withheld the men’s
passports, threatening to report them as illegal ifthey complained.126 Many had taken out loans to pay
Arefin a substantial 'deposit' to secure their jobs. They
became trapped in escalating debt to moneylenders
back home. One was even threatened with the removalof his kidney if he did not pay the money.127

125
126
127

Tackling Exploitation in the UK

Construction scams
Fraudsters typically infiltrate booming and busy
industries, disguising fake adverts among genuine
ones. Qualified professionals are attractive targets, as
fraudsters are able to charge higher fees for their bogus
services.
DI Chris Felton of the National Fraud Intelligence
Bureau (NFIB) says:“The construction industry has figured
in several recruitment scams, not just forphysical labourers, but also engineers andarchitects. The UK is seen as an attractive
place to work, particularly with the large
building firms that have good global
reputations.”
For low skilled jobs, the scams tend to focus
around visas or vetting processes. For higher paidroles, fraudsters can make extra money around
qualifications and certificates. They might generate
income from bogus or overpriced activities, such“convert” foreign qualifications, signing targets up toa “register”. They may also stipulate that victims takeexpensive medicals or online health and safety tests
which may in reality be low-cost or free.
“We’ve seen a lot of activity around advanced fee
fraud, where people are paying in advance for CSCS
cards, health and safety certificates or constructor
type affiliate badges and police checks. There may
be other charges such as working on CVs, buying
equipment or taking out insurance. If you come froman environment where there is a lot of bureaucracy,these requests can sound reasonable.” Felton says.
Professional networking sites such as LinkedIn are a
popular method for luring victims under the guise ofheadhunting. There have been several cases of British
citizens being scammed.

“UK nationals have been turning up
destitute in embassies in Indonesia,
Burma and Malaysia, having expected
to start well paid jobs,” Felton adds.

Metropolitan Police, SAFER jobs helps tackle employment fraud, September 2017
The Guardian, A slave in Scotland – I fell into a trap - and I couldn’t get out, 28 May 2016
BBC, Hotel worker Shamsul Arefin jailed for trafficking workers, 24 July 201561

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Jobsites
Scammers often pose as genuine recruitmentcompanies or labour agencies.
Keith Rosser, chair of SAFERjobs, says:“We hear of individuals, often from
Eastern Europe that have gone throughwhat they thought was a legitimate
recruitment company, only to findthemselves in a situation where their living
and accommodation costs are higher thantheir wages. So they become stuck, andalready owe money to their employer.
It’s a common form of entrapment intomodern slavery.”
Setting up a fake recruitment company is relatively
easy, simply requiring a website and a registration
with Companies House. Scammers may even use
accomplices in other countries to promote the website
as a genuine business. They often use mainstream
jobsites to post their advertisements online.
Fraudsters sometimes masquerade as big namecompanies, but with different contact details. They
often use the location of a genuine site or project tolure people in.
Rosser warns:“Fraudulent outfits find it relatively easy to pass due
diligence checks on recruitment sites. Once theiradvert has been posted, it could appear a further
twenty times across the internet in a matter of hours,
as aggregator websites automatically sweep up andduplicate the information.”Fighting the fraudsters
SAFERjobs is a joint industry, government and law
enforcement organisation to help combat recruitment
fraud. A registered charity, it has partnered withmore than 100 recruitment companies, and offers afree telephone advisory service to help jobseekers andbusinesses identify recruitment scams.
Businesses that partner with SAFERjobs are required
to carry out enhanced checks on companies that use
their services.

128

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For more information see www.safer-jobs.com

How industry can help128• By only using job boards or recruitment
agencies that partner with SAFERjobs• By promoting SAFERjobs on company
careers pages• By clearly stating the company recruitment
policy. If an organisation does not use job
boards or agencies, this should be explicitly
stated on its website• By reporting known incidences of company
names being used in fake recruitment scams
to SAFERjobs or Action Fraud. This isessential in helping the partnership build up a
detailed intelligence picture of online activity• By putting victims of scams directly intouch with SAFERjobs
If the legitimacy of any company is suspected,
internet tools can help. For example, putting thedomain name into www.whois.com/whois, will
reveal how recently the website was registered.

CIOB VIEW: Collaborate andcommunicate for greater impact
Bogus recruitment is a low risk way of trapping
workers of any nationality into debt andexploitation.
There is a need to raise this issue more widelyin the UK, but the construction industry could
also support initiatives to educate and recruit
workers more safely abroad. This would not
only help to protect vulnerable people from
exploitation, it could facilitate safe points ofrecruitment and protect the reputation of
British companies overseas. CIOB is aware of
two initiatives already underway:• The Salvation Army is running a pilot
project in Warsaw where it is advising local
people on the legitimacy of job adverts.
Anne Read, director of anti trafficking andmodern slavery says: “The advantage of thisproject is that it is low cost to run, and will
be easy to replicate in other countries.”• Hard landscaping products supplier
Marshalls is running an education project inrural Vietnam, warning local communities
about unscrupulous recruiters.

Construction and the Modern Slavery Act

Procurement“Procurement managers are under somuch pressure to save money, they’ll doanything to save their jobs.”

Tackling Exploitation in the UK

This includes:• Sending out ambivalent messages, tellingbuying teams that the company is dedicated tosustainability, but demanding that budgets are
slashedConstruction supplier• Setting buyers unrealistic targets withunachievable goals so that they continue to push
for unsustainable prices

Corporate policies and cognitive
dissonance• Encouraging an atmosphere of aggressiveinternal competition where employees areworried about losing their jobs

Ethical policies established in the boardroom do notalways translate easily into operations: Chris McCann,founder of consultancy Resilient.World believes thatbusiness leaders can suffer cognitive dissonance on
policies such as sustainability or modern slavery:“People are concerned about the planet and humanrights. But they also have a business to run. On the one
side they’re very concerned, on the other they find itvery difficult to see a way of doing things differently.”
He warns that mixed messages can lead to commercial
drivers being prioritised, and sustainability goals
diluted or discarded:“Sustainability programmes that are not integrated
into the business model, and don’t have the buy-in ofshareholders, often last no longer than 18 months.”
Dr Alexander Trautrims of the University of
Nottingham’s Rights Lab points out that construction
faces additional challenges in changing culture.
“In manufacturing, the head office can share asite with production, so it’s easier to monitor how
the culture is working,” he observes, “whereas
construction projects are usually removed fromcompany headquarters.”
As Trautrims argues, the majority of managers inconstruction do not want to behave unethically or
criminally. But clashing directives can create internaltensions for individuals or teams.

• Setting up humiliating performance
evaluations that incentivise employees to cut
corners• Rewarding workers solely for financial
performance and not evaluating their wider andbehaviours and decision making process. Thereis little academic evidence that bonuses improve
management performance.
Trautrims continues:“It’s important to create a culture where
people are not afraid to raise difficult
issues. Companies need to look at who
they are rewarding and promoting.
Is it the person who came up with somegreat cost savings, or is it the person who
decided not to use a certain supplierbecause they were uncomfortable withthe look of its operations?”
He stresses the importance of transparency, even withdifficult subjects.
“By discussing – rather than hiding - cases oflabour exploitation in your supply chain, your own
organisation gets the message that you really care andyou’re doing something about it.”“Construction should be rightly proud of its strong
health and safety culture. Within time, unethicalbusiness practice should become as unacceptable ashealth and safety violations are today.”63

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CASE STUDYProfit with purpose: Skanska and its supply chains

Skanska UK spends almost 80% of its revenues with its supply chain, and 65%
goes to SME businesses.
The company sets clear objectives for its 120-strong buying team: business ethics are embedded in the
supplier code. The sustainability agenda is included in individual performance evaluations and supply chain
tender analysis. Skanska is also using the Supply Chain Sustainability School’s fairness, inclusion and respectprogramme to further develop company and supply chain culture.
Dale Turner, director of procurement and supply chain, says the contractor is striving to create longer andmore sustainable relationships. This includes engaging suppliers over a longer time frame, typically with athree to five year outlook.
“One to two years has been the industry norm,” says Turner. “But we’re thinking more along the lines of theautomotive sector.”
Skanska is also reviewing its supplier selection processes to ensure a fair and consistent approach.
Most significantly, the procurement team is rebalancing its selection scorecard to add behavioural andcollaboration skills to the usual commercial considerations when appointing supply chain partners.
This approach was recently piloted on the A14 Cambridge to Huntingdon road improvement scheme wherecollaborative skills and behaviours (gathered through prequalification processes and audits) accounted
for 20% of the overall score. In contrast to traditional procurement models, commercial aspects typicallyaccounted for only 30% of supplier selection process.
“Behaviours and culture are critical to the project’s success. We needed to ensure that the partners we selectare aligned and can work as one team,” Turner says.
The company has used this approach across three recent civils projects and is planning to roll it out in thewider Skanska business.
“It has been at times challenging to push this in the current market, where margins are so tight. But it’s not
all about price – we believe that collaboration will achieve more in efficiency in the long run than trying tonegotiate unsustainably low prices on key products and services,” Turner adds.

Agencies

Questions should include:“In the old days, agreements were madewith the shake of a hand. But you can’ttake things at face value anymore,”• What measures is the agency putting in place toensure that workers are properly treated?

Mark Heath, GLAA

• Are they checking their databases to detect
duplicated bank accounts, addresses or mobile
phone numbers?

Mark Heath, head of business change and development
at the GLAA, advises contractors to ask more questionsof labour agencies, even at times when there is an acuteshortage of labour.
“Don’t accept that this has been sorted by someone else.
It’s your responsibility: your company is controlling thecontract and paying the bill,” he adds.

64• How are they verifying the identity of workers andtheir country of origin?

• Is the agency paying its workers individually?
• Are they operating to different standards in
different industries? If so, are workers less protectedin the less regulated sectors that they are serving?

Construction and the Modern Slavery Act

Companies should also talk directly to workers,
asking:• Are they doing the work they signed up to do? Arethey working the hours they expected, and are theyin the sector that they wanted to work in?
• Is their treatment what they expected?

Worker-centred supply chains
Ethical trade consultancy Impactt has been working
for 20 years to bring dignity to workers withininternational supply chains.
Impactt director Dionne Harrison says that companies
need to use social psychology to better understand
how workers become trapped and dehumanised in
the workplace. Four major factors have been identified
that can influence behaviour.129
Disempowerment Workers feel unvalued, see noopportunities for learning new
skills or gaining promotion,
yet feel unable to voice theirconcerns
Dehumanisation

Supervisors and managers see
workers merely as production
units. Different ethnic groups
are treated with unconscious
prejudice or bias. As workers
become “other” in the eyesof managers, it is easier
to overlook the impact ofpractices and decisions oneach individual

Isolation

Far from home and family,
migrant workers arevulnerable to social exclusion
and isolation, which can cause
considerable distressCognitive load

When someone isoverwhelmed with stressand a heavy workload, it
reduces their capacity to feel
empathy for people aroundthem. This condition may
cause supervisors to mistreat
workers129
130

Tackling Exploitation in the UK

A cocktail of conditions such as language problems,
long hours, late payment and culture shock cancontribute to workers becoming disengaged,
demotivated and increasingly vulnerable. As well as
negatively impacting their mental health, it can affectmorale, productivity and safety in the workplace.
Harrison recommends more interaction between
workers and supervisors to understand each other’s
perspectives. She emphasises the importance of proper
inductions to help workers settle in quickly, ensuringthat they understand their rights and how to ask forsupport.
Impactt is supporting an AIM-PROGRESS/Sedex pilot
project on worker voice in the food manufacturingsector, exploring the most effective ways of reaching
workers. A variety of methods are being tested,
including surveys, hotlines, face to face interviews andtext messages.
“Conversations and audits need to be conductedcarefully. There’s an imbalance of power. People
need to be mindful that their reactions, althoughunintentional, could reinforce a culture of fear,”Harrison says.

LEARNING FROMOTHER SECTORS:FASHION AND
FOOTWEAR
Better Buying130: the supplier rates
the buyer
The challenge of conflicting business objectives is
not unique to construction. Similar tensions andcontradictions can be found in the apparel sector
according to Doug Cahn, founder of sustainablesupply chain specialist The Cahn Group.
Cahn spent 15 years working for a global sporting
clothing and footwear brand. He says:“We had great codes of conduct, monitoring systems
and protocols. But purchasing practices of global
brands do not always create the enabling environment
for decent working conditions. In fact, there are manycases where CSR professionals are undermined by thesourcing person from the same company.”

As discussed at Impactt’s Worker First Supply Chains conference, September 2017
For more information, see www.betterbuying.org

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Tackling Exploitation in the UK

He gives an example.

“A CSR professional tells a factory thatit has a serious overtime problem: if it
doesn’t reduce the working week to 60
hours, there will be consequences. Hours
later, the sourcing department informs
the factory that a shipment is urgently
required and that it must do whatever ittakes to meet the deadline.”
Many clients already engage with suppliers to monitor
their own performance, but Cahn argues that this is
not enough to protect workers.
“Summits and surveys are important for developing
positive relationships, but are insufficient because
suppliers can be identified,” he adds.
As co-founder of Better Buying, an initiative toaddress the imbalance of power within supply chains,
Cahn is inviting suppliers to anonymously rate theperformance of some of the world’s biggest brands.
The pilot was launched in 2017, and the 21 online
questions in its online survey cover seven procurement
categories, from how promptly the buyer settles its
bills, to how far in advance it places an order, or how
often the specifications are changed.
“Through our research we found quite a distinction
between good and bad practice, even within the same
company. A brand might be good at paying its bills on
time, but poor at forecasting,” Cahn says.
Suppliers will participate in twice yearly surveys. In
the first round, brands receive their scores privately.
After the second survey, an aggregated score across theseven categories will be converted to a 5 star rating,and made available to the general public.
To protect supplier anonymity, at least five responses
must be collected for each buyer.
“This is a data driven survey. Brands and retailers will
have the opportunity to have a better insight on where
they need to improve. It’s about creating a race to thetop,” Cahn says.

66

Better Buying will be publishing the results of theinitial rating cycles for the world’s top fashion andfootwear and retail brands by the end of 2018. Progress
is being keenly watched by other industries, including
electronics and food.
“Supplier conditions are getting worse. Payment isstretching beyond 120 days. Suppliers are effectively
bankrolling some of the largest brands on earth andare enormously frustrated that they can’t have open
dialogue about the issues.
“On the other side, the brands and retailers don’t
really know if their policies are having the intended
effect. Better Buying should give them a clearer
understanding,” Cahn says.

CIOB VIEW: Could the Better Buying
model work in construction?
Construction is less brand-driven than fashionor footwear, and has comparably larger and morediverse supply chains. So could the Better Buying
model work in this industry?
Possibly. Scrutiny from high profile clients orinvestors could replace consumer and NGO
pressure. Greater transparency on supply
chain performance could help the investmentcommunity develop more detailed risk
assessments.
Public sector accounts for roughly half ofconstruction procurement in the UK. The
pipeline of infrastructure and construction spend
is running at roughly £500 billion.
If the scheme was adopted by regional
governments, local authorities or major
infrastructure projects, it could force a stepchange in buyer behaviour in the same way that
the London 2012 Games drove the sustainability
agenda, or Crossrail promoted innovation.
By flipping the power relationships withinprocurement, Better Buying, or something likeit, would give procurement teams a far better
understanding of how their behaviour impacts
companies lower down the chain. It would give
voice to suppliers that feel disempowered.

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CHAPTER 6: DETECTION, SUPPORT AND REMEDIATION“Every victim we’ve dealt with has an existing vulnerability. They can’t speak English, or
have low educational or social skills. There may mental health issues, learning difficulties
or some form of dependency on drugs or alcohol.”Gary Booth, team leader, Hope for Justice

Spotting the signs of exploitation
People trapped in slavery are not always easy to spot.
They could be working in plain sight, hidden inside
work teams that appear to be compliant. But there aresome warning signs that co-workers and members of
the public should look out for.
Workers could be:• Wearing damaged uniforms or equipment, forexample battered steel-capped boots, or cracked
hard hats• Not wearing all the necessary personal protective
equipment• Working in menial labouring jobs, such as moving
rubble• Showing signs of old physical injuries, for example
broken bones that have been incorrectly set, due tolack of proper medical treatment• Continuing to work with painful injuries such as
ripped tendons• Showing unusually high signs of fatigue. This could
be a sign that they are being forced to work extra
shifts elsewhere, or are hot bunking in cramped
accommodation• Looking malnourished – long term victims ofslavery could be losing their teeth at an unusually
young age– a sign that they are not receiving theright nutrients• Wearing inadequate clothing. For example, a lot of
victims can’t afford to buy proper socks that would
protect their ankles
Emilie Martin, operations manager for The Salvation
Army’s anti trafficking and modern slavery unit, saysthat many people in exploitative situations may nothave access to showers. They may only be able to clean
themselves with a wet cloth and a bucket of water.
“Look out for people that are scruffier than normal.
It’s easy to get dirty and dusty on a building site, but
the following morning, most workers will have had ashower and will look clean again.
131“If co-workers don’t make eye contact, refuse tocommunicate or engage with anyone else – even with
their own language speakers – they could be being
intimidated. It’s easy to write them off as antisocial
or just introverted – but sometimes you need to lookdeeper.”
Incidents, such as violent fights between workers,
may indicate deeper problems. They may be jokingly
explained as two countrymen sorting out theirdifferences, but could be punishment beatings, withthe handler bringing the victim back into line.

The slow road to recovery
The Salvation Army has been working for thegovernment to deliver specialist support to adultvictims of modern slavery since July 2011.131
As well as providing access to immigration and legal
advice, counselling, and advocacy services, The
Salvation Army, along with 13 subcontracted NGO
partners, manages a network of safe houses where thesurvivors of modern slavery start to rebuild their lives.
Outreach support is also available for those that havesafe alternative accommodation.
Survivors respond to the trauma in a variety of ways.
Some choose not to go into the National Referral
Mechanism or receive official help. Others can be
reluctant to talk. They may be under the belief that if
they escape, disappear or talk to the authorities, theirfamilies will be attacked and killed. Some are too
ashamed to admit the truth to relatives. Others moveabroad, joining their families in new locations. Many
will have developed addictions to drugs or alcohol:
traffickers often encourage substance abuse as a meansof keeping control.
In severe cases, some survivors may even suffer from
Stockholm syndrome and want to return to theirabusers.
John Merralls, senior operations manager with
Migrant Help UK says:

Under the Salvation Army’s Adult Victims of Modern Slavery Care and Coordination Services contract67

Construction and the Modern Slavery Act

Tackling Exploitation in the UK“Resilience levels tend to vary, depending on thelength of time that the person has been subjected toabuse, and whether they were alone or in a group.
We tend to find that groups of exploited workers that
support each other show greater resilience than thosethat were isolated. The difference is noticeable.”

LEARNING FROMOTHER SECTORS:RETAIL
Bright Future: helping victims of slavery
back to work

“Employment is the surest way to prevent
retrafficking.”
Paul Gerrard, policy and campaigns director,
the Co-op GroupIt can take considerable time for modern slavery
survivors to recover physically and emotionallyfrom their trauma. They may be suffering frompost traumatic stress disorder, or have to overcome
addictions. They may be injured, weak or sufferingfrom ill health. They may have endured years of very
poor diet and hard physical labour.
Finding work is an important part of recovery, but
survivors are in a vicious cycle. Once they leave thecare of charities, many are still emotionally vulnerable.
Without employment, safe accommodation and agood level of English they are at high risk of becoming
homeless and retrafficked.
“What’s shocking is that many victims of modern
slavery are left in limbo. People want to work. They
want to rebuild their lives,” says the Co-op Group’s
senior public affairs manager Alison Scowen.
In early 2017, the Co-op launched Bright Future, apilot project to help survivors of slavery back into
work.132
The retailer partnered with City Hearts, a charity
supporting victims of trafficking, to identify those thatwere physically and psychologically ready to work.
Over the 12 months, 30 people were taken on to workin Co-op food stores and distribution centres. They
ranged in age from 20s to 50s.
Under Bright Future, candidates are assessed for theireligibility for work using a range of criteria.

132

68

• They must be eligible to work in the UK• They must be fit and psychologically ready to go
back to the workplace• They must have adequate level of English tocommunicate with colleagues“We have to make a profit and we’re as commercial asanyone else. But we want to do it with a responsible
business approach. It’s a different way of doing
business,” Scowen says.
Candidates undertake a four week paid placement,
after which they undergo a non-competitive job
interview. If they pass the interview, they continue towork under probation for a further nine weeks before
being offered a permanent role.
Scowen says that the Co-op is continuing to refine
Bright Future, in order to give candidates the best
chance of success, but many challenges need to beaddressed.
For example, candidates are advised not to share
their story. Only direct line managers are aware of
the worker’s background. Managers must be alert
for signs of trauma and protect the employee from atendency to overwork. Each survivor will need longterm support from NGOs, even after being offered apermanent contract.
But Scowen says that the scheme has brought many
benefits.
“It has really inspired our staff. People are asking us to
do more. It makes them feel good about working for
the Co-op.”
Gerrard says:“This isn’t charity, but philanthropy. We’re giving
people a chance to help themselves, to get back on
their feet and to take control. Those who have gone
through the pilot have proved to be brilliant membersof staff. One of them recently won colleague of themonth in one of our larger stores.”
The Co-op is now working with businesses andcharities to expand Bright Future into different
sectors. CIOB and other construction partners,
including the Supply Chain Sustainability School,
are backing the initiative.
Gerrard says:“The best way to ensure that slavery survivors won’t
be re-trafficked is to get them into work. Employers
need to be brave. People have got skills and have a lot
to give.”

Bright Future evolved from a previous initiative started by David Camp of Stronger Together, working in partnership with City Hearts

Construction and the Modern Slavery Act

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CASE STUDY
Be Onsite and marginalised workers

Be Onsite is a not for profit organisation run by Lendlease. Since it was established in
2008, Be Onsite has placed nearly 600 people from the most marginalised parts ofsociety into work. The organisation is now exploring how it could work with survivorsof modern slavery.
Be Onsite’s model is to place scheme participants with Lendlease subcontractors. However, the not for profit
organisation remains the direct employer, paying workers directly and ensuring that they receive all benefits
including sickness and holiday pay.
Be Onsite provides pastoral care and helps with practical challenges, such as navigating bureaucracy. Workers
are paid weekly rather than monthly. This helps them manage rent, food and travel costs as they come off
benefits.
Head of Be Onsite, Jessica Mellor-Clark says:“This is about breaking down every single barrier and making it as simple as possible to get people into
work. By employing directly, we can look after employees in the way that we would all like to be looked after
ourselves. That means paying the London living wage as well as sick and holiday pay. These are the kind ofthings that people in permanent jobs take for granted – but agency workers often miss out on. We also takeon the employment risk for the subcontractor.”
She says that the scheme is open ended. People usually leave it because they have found direct employment
with the contractor, having proved their worth.
“That usually happens between six and 12 months,” she adds.
Mellor-Clark is now exploring how the Be Onsite model could be adapted for modern slavery survivors.
But past experience has shown that this process should not be rushed:“At Be Onsite, every case is challenging in different ways. People have their own traumas, hopes andfears. Supporting modern slavery survivors is at the more difficult end of the spectrum. I would suggestthat companies take this one step at a time, working with one person for six months to understand thecomplexities. We need to walk before we run.”

CIOB VIEW: Contributing to society
We can learn much from the Co-op’s pioneering work, as well as the experiences of Be Onsite. Offering
opportunities to victims should be an important part of construction’s contribution to society. As well as
helping companies do the right thing, it could also increase understanding of modern slavery within thewider workforce.
NGOs have identified a lack of occupational initiatives that support male survivors of exploitation, andconstruction organisations are well placed to offer training and meaningful work.
It will not be an easy process: careful management will be essential for creating the right safeguards.
However, with persistence, sustainable models can evolve.
Organisations could support Bright Future in other ways, for example helping NGOs to renovate
accommodation for safe houses; providing advice, training or support services. CIOB will be forming aworking group to explore how construction can contribute to Bright Future and would like to hear fromany interested parties.

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Tackling Exploitation in the UK

CHAPTER 7: REGIONAL GOVERNMENT APPROACHES
Different countries within the United Kingdom are developing their own initiatives tofight modern slavery and human trafficking. This chapter examines the local challenges
and responses.

Wales
The Welsh government created the role of anti-slavery
co-ordinator in March 2011, four years before theModern Slavery Act came into being.
Stephen Chapman, who has held the post sinceNovember 2012, acknowledges that there was some
initial scepticism about the prevalence of slavery inWales. Human trafficking, when it occurred, wasthought to centre on the sex trade. Now it is acceptedthat the risk is widespread.
“We’ve found slavery hiding in towns, cities and rural
areas,” Chapman says. “And all four of the police
forces in Wales are investigating live cases at the
moment. We’re expecting to find exploitation acrossall sectors and in particular forced labour, as ourknowledge and intelligence builds.”
He adds that two cases were a “wake-up call” for Wales.
The first was Darrell Simester, a vulnerable man who
disappeared on holiday in Porthcawl. Simester was heldfor 13 years by travellers, before being discovered on aremote farm near Cardiff in 2013.
Subsequently, police rescued Michael John Hughes in
2014. Hughes had travelled from Aberdeen to Waleslooking for work, but was held in forced labour for 26
years by the Connors family.
The Wales Anti-Slavery Leadership Group (a multiagency group) has launched specialised training
programmes to identify victims of slavery and help law
enforcement agencies and the Crown Prosecution Service
investigate cases and bring perpetrators to justice.
“..This is an extremely complex area. Many of the law
enforcement officers are experienced in dealing withhomicide or kidnap, but are new to these crimes,”
Chapman says. “We want to make sure that we canbuild cases that are as strong as possible.”
In addition, at least 18,000 people have received antislavery awareness training in Wales over the past three
years. The training modules are stored on the cloudand regularly updated to reflect changing policy andlegislation.

70

Code of Practice
The Welsh government annually spends £6 billion
on public procurement. It launched its Code ofPractice for Ethical Employment in Supply
Chains in 2017.
The twelve commitments in the code range from
criminal practices (such as modern slavery) to theunlawful (tax evasion) to the ethical (a commitment
to paying the living wage).
Although the code is voluntary, it is expected toaffect millions of workers in public sector supply
chains. It also goes further than MSA legislation:
any organisation receiving public funding in Wales(directly or through grants or contracts) will be
expected to produce a modern slavery statement,
regardless of size or turnover.
The Welsh Government says the code will influence
procurement on major building and infrastructure
projects. Aspects of the code will be incorporated
into tender documents as well as construction andoperational contracts.
Dr Sue Hurrell, special projects manager at the Welsh
Government, says the code is meant to be flexible,
incorporating guidance, tools and techniques to help
industry adjust.
“We see the code as being a deterrent for illegal andunethical practices. It will make companies think
about who they are tendering with for public sector
work. It should also shine a light on organisations
showing good leadership.”
The code is also being promoted internationally.
“We are engaging with other countries, telling foreign
suppliers what to expect if they want to trade with us,”
Chapman says.

Construction and the Modern Slavery Act

What the code demands of business133• Any business working with Welsh government is
expected to produce an annual statement on what
actions they have taken to combat slavery andhuman trafficking, either within their organisationor their supply chains. This will apply to all sizes ofbusiness: unlike other parts of the UK, there is no
turnover threshold of £36 million•

Anyone involved in the procurement, recruitment
or deployment of workers should receive training
on modern slavery and ethical employment
practices. Training records should be kept

• Bidders will be asked to explain the impact that
low costs may have on their workers each time anabnormally low quote or tender is received
The code also encourages companies to be moreaccountable for their supply chains.
• Businesses should ensure that undue cost and timepressures are not applied to any suppliers if this is
likely to result in unethical treatment of workers.
• They should ensure that suppliers are paid on time,within 30 days of receipt of valid invoice.
• Suppliers will also be expected to sign up to the
ethical code of practice, to encourage ethicalemployment practices to spread throughout the
supply chain.
• Risk assessments should be carried out to identify
suppliers at highest risk of modern slavery orillegal/unethical employment practices, working
with the supply chain to rectify problems andmonitor progress.
Even more pertinently for construction, the code
covers blacklisting and bogus self employment.
Companies are expected to:• Ensure that false self employment or umbrella
schemes and zero hours contracts are not used
unfairly, in particular for tax avoidance or
to unduly disadvantage workers in terms of
employment rights, or to avoid health and safety
responsibilities• Ensure that workers are free to join a tradeunion and to raise worker concerns without riskof discrimination. They must also ensure thatblacklisting is prohibited throughout their supply
chains

Tackling Exploitation in the UK

CIOB VIEW: Setting new standards
The Welsh government’s code of practice sets thestandard for fair employment and raises the bar
on working conditions, driving the agenda intoless accessible parts of its supply chains.
The use of open data will help accelerate thischange. The code of practice encourages allcompanies to file their statements with TISCreport.
The social enterprise has created a digital dashboard
for the Welsh government, giving it quick visibilityof the status of all statements in its supply chains.
The information will be publicly available on thewebsite, helping any organisation assess potential orexisting suppliers.
Over the medium term, businesses should expect
these or similar requirements to be replicatedin other parts of the UK. Scotland, Northern
Ireland and English local authorities are believed
to be watching the initiative with interest.
CIOB has added the Welsh government’s code ofpractice to its code of conduct for Welsh based
members and is promoting the code nationallyand internationally as an example of best practice.

Northern Ireland134
Awareness of modern slavery in Northern Irelandis growing. In a recent survey of 1,200 people, 54%
thought that human trafficking and modern slavery
was either very or fairly widespread. However, 77% of
respondents could not recognise signs of trafficking. 135
The Police Service of Northern Ireland (PSNI) set up a
dedicated unit to tackle modern slavery in 2015. In its
first two years, the Modern Slavery Human Trafficking
Unit (MSHTU) has helped more than 100 people outof exploitation. The team has developed a screening
process to assess and safeguard every potential victim
that is discovered in the province.
Before 2015, sexual exploitation was the most common
type of slavery that the PSNI dealt with. But now
that the MSHTU is regularly engaging with car
washes, food processing plants and construction sites,
awareness and understanding of labour exploitation
has increased significantly.

Guidance documents and further information can be accessed from the Welsh Government website :http://gov.wales/topics/improvingservices/bettervfm/code-of-practice
134 Northern Ireland’s modern slavery legislation is called The Human Trafficking and Exploitation Act 2015. It is very similar to the Modern Slavery Act.
135 Soroptimist International Northern Ireland, Outcome Report, Human Trafficking Survey Questionnaire, October 2017
133

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PSNI’s detective chief inspector Mark Bell is head of
the MSHTU and cautions that official statistics do
not accurately reflect the scale of exploitation in theprovince: in 2016, MSHTU screened and interviewed
308 potential victims. The majority were labour
exploitation cases, and roughly half were hidden in
legitimate businesses. However, only 34 cases wererecorded with the National Referral Mechanism. Thisis because many obvious victims of trafficking are
reluctant to accept state protection.

“It’s frustrating for us that people decideto remain in situations that are clearly
exploitative. And the more we look atthese kind of cases, the more we find,”
Bell comments.

The Northern Irish border
As the only UK region sharing a land border with theEU, Northern Ireland faces particular challenges indealing with crimes such as people trafficking andmodern slavery.
The 499 km border, which winds through towns,
villages, local communities, farms and even houses136
is currently open, pending Brexit negotiations. Its 300
crossing points allow trade to flourish supporting an
estimated 200,000 jobs in both countries and many
people cross the border on a daily basis for work andtrade.
The open border is important for maintaining peaceand stability in Northern Ireland, and the government
is keen to keep it “seamless and frictionless”137 after
Britain leaves the EU.

Tackling modern slavery is a priority for Northern
Ireland, as underlined by the recent publicity
campaign launched by the Department for Justice(DoJ) in partnership with private and public sector
organisations in October 2017.

Depending on the outcome of negotiations, Bellbelieves the land border may continue to be a weak
point for exploitation by criminal gangs, despiteextensive cross-border collaboration between agencies
in both countries.

The DoJ has set up a modern slavery human trafficking
subgroup, a multistakeholder collaboration whose aim
is to identify the barriers to improvement in the fightagainst modern slavery investigations.

He adds that the most common forms of trafficking
detected by PSNI have been through flights to Dublin
and then via road to Northern Ireland. Although there
have been no detected instances of victims being held
inside trucks, “a hard border at Brexit may show that
happening.”

One initiative has been Operation Outrun, aprevention programme to identify potential trafficking
victims as they enter Northern Ireland. Flights fromhigher risk locations were targeted and newcomers
selected for interview.
“We’ve been meeting people coming into theconstruction industry in this way. It has been a good
opportunity to talk to them, and check that theirstory adds up. We use the opportunity to explain tothem what modern slavery is and to give them contact
points should they find themselves in a difficult
situation,” Bell says.
He admits that the extent of a problem of modern
slavery within construction is currently unknown, but
his unit would welcome the opportunity to meet withconstruction companies at a regular forum.

“A cross-border joint agency approachis essential for tackling organised crime.
Any reduction in the close relationshipthat we have with the Guards and EU
law enforcement agencies would increasedifficulties for PSNI investigators. But
whatever the future holds, tacklingmodern slavery is a priority for the
PSNI and we are strongly committed
to bringing perpetrators to justice.”“It would be a good opportunity to raise awarenessand share information. Strong partnerships are the key
ingredient to any response,” he adds.

136
137

72

The Irish Times, Brexit: There Will be a hard border. The only question is where? , 22 March 2017
Northern Ireland Office and Department for Exiting the EU, Northern Ireland and Ireland - position paper, 16 August 2017

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ScotlandPublic procurement

The Human Trafficking and Exploitation (Scotland)Act, was passed by the Scottish parliament in 2015.

The Procurement Reform (Scotland) Act 2014, requires
Scottish public bodies to consider how procurement
can be used to improve social, economic andenvironmental well-being, with a particular focus on
reducing inequality.

As required by the act, Scottish ministers publishedtheir first trafficking and exploitation strategy on 30
May 2017 and have committed to conducting a review
every three years.
The number of trafficking and exploitation victims
discovered in Scotland is on the increase. Labour
exploitation is the fastest growing category: 213 people
in Scotland were referred to the NRM in 2017, of
which 123 were male and 126 were in some form oflabour exploitation.
Year

No of victims138% labour exploitation

2013

99

40 (40 victims)

2014

111

37 (41 victims)

2015

145

35 (51 victims)

2016

150

51 (76 victims)

2017

213

58 (126 victims)

The Trafficking Awareness Raising Alliance (TARA)
says that trafficking and exploitation139 has been
located “across the length and breadth of Scotland”.
Exploitation has been found in rural areas such as Fort
William, Annan and the Orkney Islands as well as
major towns and cities.
Surveys suggest that more work needs to be doneto raise awareness in the general public: in a recent
survey 54% of Scottish people did not believe thathuman trafficking was a problem in their area, eventhough it had been identified in 27 of Scotland’s 32
local authorities.140

Under the regulations141:• Companies that have breached environmental,social and labour law can be excluded from bidding
for government contracts. Child labour and othertrafficking offences are mandatory exclusion
grounds• Bids can be rejected where it can be demonstrated
that they do not comply with applicable obligations
in social, environment and labour law• Bids that are established to be abnormally low,
because they do not comply with environmental,social and labour law, must also be rejected• All public bodies in Scotland that spend morethan £5 million annually must publish an annual
procurement strategy, including their generalpolicy on fairly and ethically traded goods andservices

The living wage142 and fair work
The Scottish government was the first in the UK tobecome an accredited living wage employer and has
pledged to work with the Poverty Alliance to builda ‘living wage nation’ over the next three years.
Currently there are more than 1,100 living wage
accredited employers across Scotland.
The Scottish Business Pledge, a shared mission
between government and business to boost
productivity, competiveness and fair work, includes acommitment not to employ people on exploitative zero
hours contracts (or comparable very low core hours).
Employers must ensure that contracts are fair andappropriate.

138 Adults and children combined
139 Scotland uses the terms trafficking and exploitation in preference to modern slavery
140 Reuters, Scotland details human trafficking hotspots in bid to end abuse, 31 August 2017
141 For full details of procurement policy see The Scottish government website: www.gov.scot/Topics/Government/Procurement/policy/ProcurementReform
142 See scottishlivingwage.org

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CHAPTER 8: DRIVERS OF CHANGE
Companies often ask whether there is a clear business case for incorporating anti-slavery
initiatives into their operations. This chapter examines the push of legislation and the financial
incentives for better governance, along with some platforms, standards and frameworks for
improvement.

International legislation
The UK Modern Slavery Act should be seen as partof a wider mosaic of anti-slavery and human rights
legislation being passed or drafted around the world.
The 2010 California Transparency in Supply
Chains Act, which came into effect in 2012, mandates
large companies to publicly disclose the steps that they
have taken to address human trafficking and forced
labour in their supply chains.
The EU Non Financial Reporting Directive is now
in force. It requires large organisations to report on
their due diligence processes, disclosing what actions
they are taking to manage risk on non-financial issues
including the environment, human rights, employee
welfare, corruption and bribery.
France passed the Duty of Vigilance Law in 2017
which requires companies with more than 5,000
employees in the country, or 10,000 worldwide, topublish the steps they are taking to root out humanrights and environmental violations from their supply
chains.
The Netherlands has proposed a law requiring
companies to conduct due diligence on child labourin supply chains, and anti-slavery legislation is also
being drafted by the Australian Parliament.
There are campaigns for targeted legislation to be
introduced to many other countries including New
Zealand, Switzerland and the United States.
The UN’s Sustainable Development Goal 8.7 isto eradicate forced labour and modern slavery by 2030,
and ending all child labour by 2025.

UK multinationals and duty of care
At the time of writing, no civil claim has been brought
against a British company for failing to prevent
modern slavery in its international supply chains.
This could change as lawyers explore how strategic
litigation could be used to hold parent companies
accountable for the actions of their subsidiaries.

143

74

For many years, multinationals have been able toabsolve themselves of responsibility for wrongdoingin their international operations using two mainarguments:• The corporate veil – the rule of English law that
one company and board of directors cannot beheld responsible for the wrongdoing of anothercompany or individual• That the laws of the UK should not apply towrongdoing overseas
James Sinclair, international lawyer and researcher inmodern slavery at Kings College London believes that
this has led to a culture of corporate complacency.
“Many multinationals have been pushing liability
onto their subsidiaries, secure in the knowledge thatlegal systems in developing companies won’t supportcomplex court cases,” he says.
Pressure is now growing for cases to be heard whereparent companies are headquartered. One landmark
ruling indicates a shift in the legal landscape.
In 2016, 1,800 Zambian farmers were given the rightto sue Vedanta Resources in the English courts overenvironmental abuses committed in Zambia by its
mining subsidiary KCM.
Vedanta, which is headquartered in London, argued
that the case should be heard in Zambia. But English
high court judge Sir Peter Coulson dismissed thisargument on the grounds that the Zambian legal
system was insufficiently resourced for such a large
and complex trial.143
It is still uncertain whether the trial will be heard in
London. Vedanta lost its appeal against the rulingin October 2017, but may take its argument to theSupreme Court. However, lawyers, academics andNGOs are watching developments closely.
Other trials have already challenged the concept ofcorporate veil. One landmark ruling was Chandler v
Cape 2012 where Cape plc was successfully sued fornegligence in an asbestosis case. It was proved that thecompany knew about the potential harm caused by

The Guardian, Zambian villagers win right to have pollution case heard in Britain, 27 May 2016

Construction and the Modern Slavery Act

asbestos in the 1950s and should have been sufficiently
close to its subsidiary, Cape Products, to exert better
control over worker health and safety. Judge Lady
Justice Arden ruled that the parent company had
failed in its duty of care to Mr Chandler.
Sinclair believes that the tests applied in Chandler
and Cape (and possibly Vedanta) could be utilised inlabour exploitation cases.
Given the endemic nature of bonded and forced labour
in international supply chains, it can be difficult forcompanies to know where to start remedial action.
Sinclair argues that companies can protect themselves
by taking meaningful steps, even if full and immediate
compliance cannot be realistically expected. Thisshould result in a much lower risk of litigation, evenwhen failings are found.
“Companies taking meaningful and reasonableactions to address labour exploitation are unlikely tobe pursued. But those with systematic modern slavery
practices at the heart of their business models – or using
their modern slavery report as an elaborate PR exercise- could find themselves in difficulty,” he adds.

Investors demand greatertransparency“Workforces are an essential and corecomponent of any organisation, yet too
often .....they are a missing piece in thecorporate reporting jigsaw.” 144
Joanne Segars, Chief Executive, National Associationof Pension Funds (NAPF)
Sustainable investing used to be a niche activity.
Today, environmental social and governance (ESG)
factors are becoming increasingly important tomainstream investors.
As major financial players such as Bloomberg,
Morgan Stanley and Goldman Sachs expand their
ESG products,145 the Financial Times reports thatinterest in impact investing, which aims to balance
profits with social good, has exploded in recent years.
The UK market alone is estimated to be worth morethan £1.5 billion.

144
145
146
147
148
149

Tackling Exploitation in the UK

Investors are looking for longer time horizons andacknowledging that short term investment approaches
can lead to negative social outcomes.146This is reflected
in a 2015 survey by the NAPF where investment
managers thought that a company’s human rights
record, and the pay and conditions of its employees,
were more important than executive pay. 147
One of the barriers to investment engagement with
ESG criteria has been the poor quality of the data.
Now, initiatives are emerging that will create aconsistent framework for benchmarking human rights
performance. Examples include:
The Corporate Human Rights Benchmark(CHRB)148 released its first results in March 2017 inwhich it ranked the human rights performance of 98
of the world’s largest publicly traded companies fromthree sectors: agriculture, apparel, and the extractive
industries. There are already plans to expand CHRB
into other areas. Construction organisations in oil andgas supply chains may already be feeling the effects of
the CHRB.
The Workforce Disclosure Initiative (WDI) 149
Campaign group ShareAction launched theWorkforce Disclosure Initiative in 2017. Developed inconsultation with investors, companies, trade unions
and NGOs, the project was backed by a coalition of
79 institutional investors in its pilot year, representing
US$7.9 trillion assets under management.
Several of the 75 publicly listed organisations
approached to take part in the WDI pilot survey
work in the built environment sector. Companies
that submitted information included Land Securities,
British Land, Vinci, Saint Gobain and CRH.
Although the WDI has no specific questions on
modern slavery, several areas deal with related risk
factors including recruitment, working hours, supply
chain transparency and health and safety.
As the initiative evolves annually, the range ofparticipating organisations is expected to increase,in line with the volume of investors engaging withcompanies on workforce issues. ShareAction will be
encouraging respondents to extend reporting beyond
their critical supplier list.

NAPF, Where is the Workforce in Corporate Reporting?, June 2015
NYU Stern & Center for Business and Human Rights, Putting the “S” in ESG: Measuring Human Rights Performance for Investors, March 2017
NYU Stern & Center for Business and Human Rights, Putting the “S” in ESG: Measuring Human Rights Performance for Investors, March 2017
NAPF, Where is the Workforce in Corporate Reporting?, June 2015
See www.corporatebenchmark.org
WDI is funded by the UK Government’s Department for International Development (DfID). See www.shareaction.org/wdi

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CASE STUDYLand Securities and the Workforce Disclosure Initiative

Landsec is the UK’s largest commercial property company, owning, operating andmanaging £14.4 billion or 23.2 million sq ft of real estate. The company participated in
the WDI pilot in 2017.
Part of Landsec’s commitment to the WDI involves disclosing data not only on its directly employed
workforce, but also employees in its supply chains.
Edward Dixon, sustainability insights director at Land Securities, says:“This is pushing us to look at areas that we haven’t looked at before and is highlighting gaps in our knowledge.
For us, the most noticeable data gaps are with our one-off contractual relationships and construction
projects.”
Landsec’s challenges are similar to many other property companies: the company has 3,500 direct suppliers
and but works regularly with only a small pool of trusted delivery partners.
“Our delivery partners are doing good work on improving labour standards. But much of it is process based.
We now need evidence that the processes are working,” Dixon says.
He gives the example of the living wage. Landsec has committed to ensuring that employees within all its
environments, including construction sites, will be paid wages set by the Living Wage Foundation by 2020.

“We’ve added clauses to our contracts to make this requirement clear, asking themto confirm by sending a letter that they’re paying wages as set by the Living Wage
Foundation. But now is the time to provide evidence to prove that it’s happening on
the ground,” Dixon says.
He adds that investors are demanding increasing levels of transparency, as ESG criteria rises in importancein investment portfolios.
“We welcome higher levels of interest from the investor community. There is no doubt that investor pressure
is impacting corporate governance in a positive way. The ESG agenda from investors challenges companies
to do more and we’re responding to that challenge” he says, adding:“Every tier of the industry needs to come together to fix the systemic problems we’re facing. Clients needto show leadership by setting the tone and asking the right questions. It’s important to demonstrate to ourpartners and our communities that we are thinking for the long term, and to our investors that we’re creating
value in a responsible way.”76

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New standards and social
platforms

Balfour Beatty was the first contractor to complete
assessment against ISO 204000, using Action
Sustainability as the independent assessor.

New types of standards are emerging that arechallenging old ways of thinking. Instead of passing
or failing audits, organisations are being evaluatedagainst frameworks that encourage continual
improvement. Here are two examples:“The removal of a ‘pass or fail’ status allowed us tohave honest and frank discussions with the assessors,which in turn resulted in a much clearer picture ofwhere we stand and what we need to do to move
forward,” says the company’s head of sustainableprocurement Aaron Reid. 150

BS ISO 20400
The International Standard for Sustainable
Procurement BS ISO 20400 was published in
May 2017. Replacing British standard BS 8903, it
incorporates recent developments on sustainability
such as the UN Guiding Principles on Human Rights
and Business and ISO 26000.
ISO 20400 is described as a ‘guidance’, rather than a‘requirements’ standard. Instead of being issued withcertificates, organisations are encouraged to work withindependent experts to improve their operations.
Action Sustainability is one organisation that has
been developing ISO 204000 guidance to help
companies incorporate their anti-slavery initiatives
into the framework.
Helen Carter, senior consultant at Action
Sustainability and the Supply Chain Sustainability
School, says the guidance will help a company
evaluate its governance, training capability andgrievance mechanisms, as well as setting KPIs that aremeaningful to the business.

BRE’s Ethical Labour Sourcing standard
BRE launched its Ethical Labour Standard BES 6002
in February 2017. The standard provides a framework
for continual improvement in sourcing labour andmaterials within a supply chain. Organisations that
undergo the standard are verified annually by BRE
assessors.
Assessment covers 12 areas: organisational andmanagement structure, HR, procurement, bribery
and corruption, forums, management policies,
immigration, supply chain management, learning anddevelopment, reporting, assurance and compliance.
Marshalls was the first company to be verified by the
ELS, and Sir Robert McAlpine was the first contractor.
Construction labour supplier VGC also achieved
verification in early 2018.

She adds:“This standard moves away from tick-box
exercises. It helps businesses define and set
their own priorities and should enhance
supplier relationship management.”

150

Construction Manager, When is an audit not an audit?, 22 May 201777

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CASE STUDY
Sir Robert McAlpine adopts the ELS

Building and civil engineering contractor Sir Robert Mc Alpine was founded in 1869 andis still family-owned. The company has an annual turnover of around £1.2 billion anddirectly employs 2,000 people. Sir Robert Mc Alpine was the first main contractor to beverified under the BRE’s Ethical Labour Sourcing standard in 2017.
“Our first response to the Modern Slavery Act was to ensure legal compliance. Once we’d established how
this would affect our business and our supply chain, we quickly saw the need to become proactive.” says Anna
Baker, head of sustainability at Sir Robert McAlpine.
The company had been helping to develop the Ethical Labour Sourcing standard as part of a BRE stakeholder
group. Alice Hands, sustainable procurement manager at Sir Robert McAlpine says:“We like the fact that the ELS is structured to encourage buy-in from all departments. It provides a pathway
for setting clear objectives.”
Hands initially led the ELS project. Her first challenge was to ensure that the right disciplines across thebusiness were included and working strategically.
For example, HR led the review on internal staff practices while the procurement team assessed majorrisk areas in the supply chain. Hands says that the procurement initiative opened up dialogue with suppliersof all sizes.
“We fully acknowledge that we can learn from suppliers, particularly as some have far larger reach than us.
It has been a two way interaction,” she adds.

Working towards continual improvement
One important aspect of the ELS is that it is not about passing or failing. Companies are monitored on anagreed set of objectives and work towards continual improvement.
“We’re on a journey. We acknowledge that any contractor could be infiltrated by criminality. This is about
making our processes and those of our supply chain more resilient to that threat,” Hands says.
But she stresses that openness was an important part of the verification process.
“Internally, some of our stakeholders were asking why we hadn’t scored higher in certain areas. But we needto get away from that mentality. Ethical practice is about tying our processes and approach to the values ofthe organisation, and discovering where we need to do the most work, in order to make the biggest difference,both for our employees and our extended supply chain.”

ELS – phase one
In the first phase, Sir Robert McAlpine has been engaging in particular with four issue areas within the ELS,
but Hands expects activities to expand quickly to all of the standard’s 12 business sections.
Initial activities include:• Making the company’s cross disciplinary modern slavery working group a permanent fixture, bringing inpeople from all aspects of the business• Reviewing and updating procurement strategy• Developing the company’s existing anti bribery and corruption programme, identifying job roles that may
need further support and training78

Construction and the Modern Slavery Act

Tackling Exploitation in the UK• Providing training to everyone in the company about the realities of modern slavery and how to spot thewarning signs• Raising the public profile of important policies through the supply chain and beyond. “We’re making surethat whistleblowing and procurement policies are communicated at a consistent and more visible level,”
Baker adds.

Procurement
The company is involved in several collaborative initiatives and has participated in the Supply Chain
Sustainability School’s special interest group on supply chain mapping. Initially, the company is engaging
with subcontractors thought to be working in higher risk areas.
“We’re not necessarily saying that our subcontractors have this problem, Baker says, “But we know fromthe GLAA that some areas – particularly those that use temporary low skilled labour - are at greater risk of
infiltration from criminal gangs.”
But Hands sounds a note of caution. “We want to engage with our supply chains in a positive way. Rather
than ending up having to deal with something once it has gone wrong, we want to be more engaging andcollaborative to avoid getting to that stage in the first place.”

Whistleblowing and communications campaigns
Sir Robert McAlpine has set up an independent whistleblowing helpline, administered by a third party. It hasrolled out an e-learning module as well as a communications campaign that encourages anyone within thecompany to report problems. This approach has already brought benefits, with potential issues being raised bypeople across the company.
“As a business we talk to people regularly on site. While that is one good avenue, it doesn’t work in all
scenarios. For example, if there are language issues, or if a supervisor is breaching ethical codes. We also want
to give people confidence to report anything that doesn’t feel quite right to them. Something not feeling rightis often the best indicator,” Hands says.
The company has appointed a whistleblowing officer that will co-ordinate activities if a problem is found.
“The enquiries that we have had so far have been fairly straightforward. Our next big challenge is how we deal
with complex enquiries that may come through,” Baker adds.

Looking ahead“We’re using the ELS to evaluate where we are on our ethical labour journey. The framework allows us totake a flexible approach as we evaluate each stage. So we’re keeping an open mind on how this will develop,”
Hands says.
Baker cautions that the construction industry’s response to the Modern Slavery Act runs the risk of creating
mountains of site audits that are not properly analysed or shared.
“We want to share what we’re learning - both good and bad - with other parties. We’re hoping that initiatives
such as the Supply Chain Sustainability School and the GLAA construction protocol will enable wider
industry sharing. We can learn a lot from each other within our own sector, as well as others, such as retail,that have been working longer in this area.”
She adds:“The more we explore the issues beyond legal compliance, the more we realise that this is not a case of asking‘if’ but ‘when’ we find modern slavery in our supply chains. We believe that how we deal with the situation
when we encounter it will provide a true reflection of who we are as a business and what we stand for. And, as
an industry, it will give us an opportunity to show how collaborative we can be.”79

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The following case study examines how major contractor Mace is working with collaborative platform Sedex tobetter understand its supply chains.

Case study
Mace and Sedex

Global built environment consultancy and contractor Mace turned over £1.97 billion
in 2016. The company’s construction business focuses on the UK, Ireland and mainland
Europe; whilst consultancy activities are delivered from five global hubs. Mace directly
employs 5,900 people in the UK.
Mace is one of the first UK contractors to adopt the Supplier Ethical Data Exchange(Sedex), described as “the world’s largest collaborative platform for responsible
sourcing data”. Sedex was established in 2001 and now has 43,000 members inmore than 150 countries.
Mace signed up to Sedex in 2015. Head of sustainability for construction Ross Wood says that part of theplatform’s appeal is that its systems were well established.
“It’s also cost and time efficient,” he adds. “Suppliers pay an annual membership of £60, and they only have tosubmit their information once. They can then choose to share their data with as many clients as they like, so it
should reduce bureaucracy.”
There are three different levels of Sedex membership. Clients become A members, using the platform toengage with their supply chains. B membership is for suppliers. Suppliers post compliance information
policies and audits and link to buyers with whom they want to share the information.
As a buyer and supplier, Mace has taken AB membership, which enables it to share information in both
directions: upwards to clients and downwards to suppliers.
Mace is still in the early days of engagement with Sedex. So far more than 120 suppliers have linked to Maceon the platform. Wood says that the majority are tier one and based in the UK.

“We’re at the stage where we’re starting to dive deeper into our supply chains. Sometier one suppliers are helping to get lower tier members to sign up. Our aim is toencourage more engagement from international suppliers as well,” he adds.
The company initially focused on cladding and MEP suppliers. Mace targeted these trades because they
represented big packages of work and a large proportion of spend. They also featured products with multiple
components that were more difficult to trace.
“By contrast, our policies and standards give us a much better handle on the provenance of elements such as
timber, concrete and steel,” Wood says.
Newcomers to the platform fill out a self assessment questionnaire, answering questions in four categories:
labour standards, health and safety, business ethics and environmental management. They can also post
information, such as policy documents or the results of ethical audits.
The new members are then given a score for each for each category which is combined with a general risk
score for the country in which they operate.
Mace has been using Sedex-generated reports to map risks globally. A recent example is a report on
forced labour indicators. On the basis of these reports, Mace has been issuing briefing sheets to its
procurement teams.

80Construction and the Modern Slavery Act

Tackling Exploitation in the UK“Our aim is to help them ask more informed questions. If we know, for example
that there is a risk of poor business ethics in a company or region, we dive in tounderstand the systems and procedures a supplier might be using to mitigate risk.”
However, Wood stresses that Mace’s goal is to work positively with suppliers.
“We’re looking at how we can support them to fix any problems. Our aims are to upskill the rest of theindustry, to understand where the problem lies and eradicate it,” he says.
Although membership of Sedex is not a compulsory part of Mace’s prequalification process, it has been
written into tenders.
“Once companies work for us, they are contractually obliged to join Sedex, maintain the membership andlink with us on the platform,” Wood says.
He is hoping that the use of Sedex will ultimately enable every component on a Mace project to be traced
back to its origins.

“We want to get to the point where we can break every item down to its raw
materials. For example, once we know how a cladding supplier sources its glass andrubber, we can link then link through to those production plants. We’re hoping that
Sedex will help us engage faster with the lower tiers.”
But one major challenge will be checking the quality and validity of the information on the platform.
“Sedex is not a certification system. So it’s incumbent on us to do the due diligence, such as checking thatISO 14001 certificates have not expired. The further we go down the supply chain, the more due diligence
will have to be done,” Wood says.
So far Mace has focussed on using Sedex for materials procurement. It is still assessing how best to deal withother aspects, such as temporary labour.
“Our long term plan is to get our entire supply chain signed up to Sedex, but that’s going to take a few years.
In the meantime, we’re also looking at other options around labour, such as how we do frontline checks onsite. We’re looking for a solution that is appropriate, sensible and easy for our supply chain to adopt, without
unnecessary paperwork,” Wood explains.
Ultimately, he believes that engagement with major clients will accelerate the take up of Sedex inconstruction. One of its clients, Heathrow Airport has signed up to Sedex.
Heathrow procurement process and performance manager Rob Wilton says that the operator is now asking
its major suppliers to register on the platform.
“As a key supplier and partner, Mace has been collaborating with us in driving the roll-out program,” Wilton says.
Wood would like to see more major contractors engaging with the platform as AB members.

“There is so much crossover between our supply chains and those of our peers.
It can only be for mutual benefit if more people join the platform.
“I’d like to think that as an industry we could come together to solve some of oursystemic problems. I don’t see this as a business differentiator.”81

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Industry initiatives roundup
Here follows non-exhaustive list of anti-slavery
initiatives and organisations that are positively
influencing UK construction as well as other sectors
and regions. We regret that we are unable to include
all players, but are keen to hear from any organisation
doing relevant work for future reports.

APRES and the Eight Pathways to bestpractice
The Action Programme for Responsible and EthicalSourcing (APRES) - a learning network created by
Loughborough University - launched a white paper in
September 2017 on the responsible ethical sourcing ofmaterials products and people.
The APRES eight pathways model helps organisations
examine their operations from a responsible andethical sourcing perspective. Areas covered include
policies and management systems, compliance,
auditing and reporting, procurement, HR, financial
management, recruitment and external relations.
APRES says the model is relevant to clients,
contractors, subcontractors, suppliers, designers,
specifiers and buyers as well as auditors.
• APRES is now managed by Constructing Excellence(CE), the platform which promotes best practice andindustry change. CE merged with BRE in 2016.
http://apres.bre.co.uk

BRE
BRE has launched the Ethical Labour Standard
BES 6002. Two companies that have successfullygone through the ELS are Marshalls and Sir Robert
McAlpine. Labour provider VGC also achieved
verification in early 2018.
An updated version of the ELS standard was launchedin April. It can now be accessed online and has a freeself assessment module.
www.elsonline.co.uk
Every year, BRE runs Modern Slavery and Ethical
Leadership in Construction Symposium.
www.msa4construction.com

Building Responsibly
Building Responsibly is a group of international
engineering and construction companies collaborating
to improve the rights and welfare of workers. Activities
include: agreeing on common standards; developing82

tools; engaging with workers, clients, governments,
and civil society; sharing best practice and, driving
innovation and continuous improvement across thesector. Focus areas include recruitment, subcontractor
management, living and working conditions.
The group is administered by non-profit organisation
BSR (Business for Social Responsibility) and fundedby corporate membership fees with additional
support from Humanity United. Founding members
are Amec Foster Wheeler (now Wood Group),
Bechtel, CH2M (now Jacobs), Fluor, Multiplex Middle
East, and Vinci.
Membership is open engineering and construction
companies “committed to upholding and promoting
the rights and welfare of workers.”
www.bsr.org/en/collaboration/groups/buildingresponsibly

The Chartered Institute of Building
CIOB has updated and strengthened rules of conduct
and disciplinary procedures following detailed
consultation with chartered organisations and nearly
3,000 individual members. The new code of conduct
came into force in January 2018.
During the consultation, 99% of individuals, 100% ofcompanies and 97% of consultancies agreed or agreed
strongly that integrity, honesty and trustworthinessshould be the guiding principles of an organisationand the conduct of its employees.
CIOB has added the crimes of terrorism andtrafficking, slavery and immigration to its disciplinary
regulations. Members overwhelmingly backed thestrengthening of regulations.
At the beginning of 2017, the CIOB Academy
launched the sector’s first massive open online
course (MOOC) dedicated to ethics and compliance.
The five week interactive course is free and open
to anyone working in the built environment sector
anywhere in the world.
Devised in collaboration with ethical experts, theMOOC is designed to empower people to makebetter decisions at work: improving relationships,
identifying conflicts of interest and taking steps tominimise risk.
CIOB also supports the Stronger Together Toolkit.
The organisation is preparing to sign up to the UN
Global Compact.
www.ciobacademy.org
www.ciob.org/about/governance/royal-charter

Construction and the Modern Slavery Act

The Chartered Institute of Procurement
and Supply
CIPS has developed and collected a wide range ofeducational materials and guidance on modern slavery
which is free to access free from its website.
www.cips.org/en-gb/knowledge/procurement-topicsand-skills/sustainability/modern-slavery/

Clearview
Developed by the Association of Labour Providers andmanaged by NSF International, Clearview is a global
social compliance certification scheme for labour
recruitment. ALP says the scheme, launched in March
2018, will help labour providers, recruiters and brands
assure and continuously improve working conditions
in domestic and global supply chains. Based on UN
guiding principles on business and human rights andother international standards, Clearview is designed togo ‘beyond audit and compliance.” The scheme applies
to workers in any country in a wide variety of sectors,
including construction.
www.clearviewassurance.com

Construction Coalition launches charter
British-based built environment institutions haveformed a coalition to raise awareness of and eradicate
modern slavery from the sector’s supply chains.
Established and led by Dr Shamir Ghumra, headof responsible sourcing at BRE, the coalitionis supported by CIOB, Build UK, Constructing
Excellence, Royal Institution of Chartered Surveyors,
Royal Institute of British Architects, Chartered
Institute of Procurement & Supply and the Supply
Chain Sustainability School, as well as a number ofbusiness and civil society organisations including the
Ethical Trading Initiative, the Business & Human
Rights Resource Centre and the Institute for Human
Rights and Business.
Coalition members have signed up to a charter forcombating modern slavery. Commitments include
developing tools and training materials on businessand human rights; supporting best practice throughpartnerships and research; using influence to support
the abolition of illegal and unethical practices
whenever they are found.
www.msa4construction.com

Tackling Exploitation in the UK

East Midlands - collaborative projectIn 2017, the University of Derby launched a joint
collaboration with the Derbyshire Constabulary
to improve information flow on human trafficking
between business and the police in the region.
The Combating Modern Slavery, East Midlands Police
and the Business Community in Collaboration project,
led by researcher Laura Pajón and Professor DavidWalsh, has established multi-disciplinary teams ofbusiness leaders, academics, statutory agencies andpolice officers to develop best practice around priority
areas such as business support, information sharing,
communications and training.
The initiative is expanding to new regions. Businessof all sizes are invited to join the regular seminars.
For more information contact:
L.PajonMoreno@derby.ac.uk

GLAA Construction Protocol
This framework, launched in Autumn 2017, hasbeen developed to encourage interaction between
construction companies and the Gangmasters andLabour Abuse Authority. From 2018, the GLAA will
be running quarterly meetings to which construction
companies will be invited.
This is an open invitation to any business in the
sector. Discussions will be treated in confidence.
For more information contact Samantha Ireland,head of business change at the GLAA.
samantha.ireland@glaa.gsi.gov.uk
www.gla.gov.uk/i-am-a/i-use-workers/constructionprotocol

Leadership Group for Responsible
Recruitment
Recruitment fees paid by workers often leave them insituations of debt bondage. Members of the LeadershipGroup for Responsible Recruitment, launchedby the Institute for Human Rights and Business(IHRB) in 2016, have signed up to the Employer Pays
Principle: No worker should pay for a job. The costs ofrecruitment should be borne not by the worker but by
the employer.
Members include Coca Cola, Walmart, Tesco, M&S,
GE, Mars, Hewlett Packard, HPE, IKEA, Unilever andconstruction firm Vinci.

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The group’s aim is to eradicate worker fees fromsupply chains within a decade. It is advocatingthat the Employer Pays Principle is embedded incodes of practice, and adopted by industry groups,
governments and trade bodies around the world.
www.ihrb.org/employerpays/leadership-group-forresponsible-recruitment

The Local Government Association
Representing over 370 councils and all fire andrescue authorities in England and Wales, the LGA
has produced guidance, in collaboration with theindependent anti-slavery commissioner. As well as
helping councils identify and safeguard victims, theguidance, published in November 2017 also addresses
local authorities’ procurement and supply chains.
www.local.gov.uk/modern-slavery-council-guide

APPG on Mega Sporting Events
Baroness Young of Hornsey has set up an all party
parliamentary group on mega sporting events,
modern slavery and human rights. The group will
look at activities around a range of high profile events
including the Olympic and Commonwealth Games,
Champions League, Formula One and the FIFA World
Cup. Construction related companies will be invited
to present evidence on the building of stadia andsupporting infrastructure and to collaborate on policy
areas and procurement criteria that tackle labour
abuses within such programmes.
Baroness Young says: “Sport is a great medium forbringing human rights issues to the attention of thegeneral public. Fans are acutely aware of the build
progress around stadia projects, but how many areasking whether the people working on those projects
have been coerced or trafficked? By raising the profileof these issues, I’m hoping to bring more pressure on
business and government to ensure robust measures
are put in place to deal with this.”Stronger Together
The multi-stakeholder initiative first launched in2013 for the consumer goods sector has a new CIOBbacked construction programme. Project sponsors
include Multiplex, Saint-Gobain, Westfield andWillmott Dixon. Stronger Together is running regularinteractive workshops across the UK that are open to
any interested parties.
The Stronger Together website offers a range of freedownloadable materials and resources. This includes
a short awareness raising film that can be used in
induction and training. The organisation will also

84

soon be launching an online progress reporting
tool, enabling companies to monitor the progress of
their anti-slavery initiatives, checking them against
industry standards.
www.stronger2together.org/construction

The Supply Chain Sustainability School
Supply Chain Sustainability School has 25,000
registered members and partners with more than
65 major contractors and clients. Its aims are to
improve the performance and sustainability ofbuilt environment supply chains. Run by Action
Sustainability, the school has produced a range offree educational and training materials on modern
slavery, and also holds regular events on fairness,
inclusion and respect. Membership is free and relevant
to anyone working in the built environment sector in
England, Scotland and Wales.
www.supplychainschool.co.uk

West Yorkshire Anti –Trafficking andModern Slavery Network
WYATMSN was set up in 2014 by anti-humantrafficking charity Hope for Justice in conjunction with
West Yorkshire’s police and crime commissioner
Mark Burns-Williamson. The network createsa strategic meeting point for public and privateorganisations to tackle modern slavery in theregion.
The network originally worked with local authorities,
the police and NGOs. Since 2016, following a major
engagement event with local employers, banks andrecruitment agencies, it has been sharing information
on recent prosecutions as well as local and national
trends in worker exploitation.
Modern slavery issues can be different even inlocations within the same county. So the WYATMSN
has now established smaller forums in local authority
districts within West Yorkshire, and is hoping for
closer interaction with businesses, as well as building
a more detailed analysis of challenges to agencies andlaw enforcement across the region.
The West Yorkshire PCC’s safeguarding adviser Stuart
Piper says:“This is the perfect opportunity for the police, otheragencies and NGOs to partner with businesses andto share information. We need to tap down to a local
level and work together if we are to effectively tackle
the problems of modern slavery.”
http://hopeforjustice.org/wyatmsn

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Tackling Exploitation in the UK

CHAPTER 9: COMPANY CASE STUDIES
Responding to the Modern Slavery Act has set many organisations on a journey. In thischapter, companies in the construction sector tell their stories and look to the future

Great Portland Estates
Great Portland Estates is a FTSE 250
property investment and development
company that owns over £3 billion of realestate in central London.
Worker interviews
In response to the Modern Slavery Act, one of GPE’s
first activities was to investigate labour on its sites
through worker engagement surveys.
“We started with site labour because we could get
on with that task quickly. But we didn’t just want
to audit on modern slavery, we wanted to develop abetter understanding of how the workforce was being
treated down the supply chain,” says GPE head ofsustainability Janine Cole.
GPE collaborated with supply chain specialist Achilles,
providing one of the original pilot schemes for
Achilles to test and develop its worker engagement
survey. The client has since adopted the approach on
six sites in central London, working with five main
contractors.

Implementation
Achilles conducted five minute tablet surveys, stopping
workers randomly on their way back from breaks.
“We didn’t want to take people off into a side room,
where they might have felt intimidated, so we decided
to make it as informal as possible,” Cole says.
The surveys covered conditions on site, welfare
facilities and employment conditions. Questions
included:• whether the workers had to pay for their own PPE
equipment• whether site inductions were conducted in theirnative language• whether they were being paid the London living wage
• whether any of their documents had been withheld• whether they had had to pay a bond to secure thework• who their employer was

The findings“On analysing the first responses, we had as manyquestions as answers. So we’ve been fine tuning thequestions ever since,” Cole says.
One overriding theme was the high level of self
employment across all sites.
“Although the high rate of self employment is wellknown in construction, the surveys highlighted the
difficulties this creates, particularly in training anddevelopment. Self employed individuals are moredifficult to track. It’s more of a challenge pushing oursite policies down the supply chain, even just from ahealth and safety point of view,” Cole says.
Although no serious problems were found, the surveys
revealed that awareness of modern slavery was stillpoor amongst the workforce. GPE also found someinstances where it was not possible to prove thatworkers were receiving the London living wage.
Some welfare issues emerged on all sites.
“The worker engagement surveys have provided a
different feedback loop. We believe they have given amouthpiece to workers that may have been reluctant toraise concerns previously,” Cole says.

Actions
Rollout: Over the next few months, GPE willcontinue to roll out worker engagement surveys on all
construction and refurbishment projects valued at £5
million or higher.
Contractors and subcontractors are informed thatsurveys are taking place, but are not told when they
will be conducted. Questions will continue to berefined as intelligence builds.
“By carrying out regular engagement and querying
our findings we hope to drive improvement. This wasa learning process for all parties and we will continue
to develop our approach as our understanding of theissues deepens,” Cole says.
Translation: GPE is planning to conduct surveys inworkers’ native language, to ensure that all answers are
independent and not reliant on translation from others.
Awareness-raising campaign: In the coming
months GPE plans to launch a poster awareness-raising
campaign on modern slavery. “We want to reach out to85

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the whole workforce - and supervisors in particular about spotting the warning signs,” Cole says.

LendleaseLondon living wage: In cases where it is unclearthat workers are receiving the London living wage,
GPE has taken up the issue with principal contractors
to ensure that this is reviewed throughout their
supply chains.

Development, construction and finance company
Lendlease is headquartered in Sydney, Australia andoperates in Asia, Europe and the Americas. With
12,000 employees worldwide, Lendlease directly
employs 1,900 people in the UK.

Welfare facilities: Responding to feedback fromthe surveys, GPE is working with all of its principal
contractors to improve the general standard of welfare
facilities across sites, including access to drinking water,
improving canteen facilities and maintenance of toilets.

PQQs and audits

Procurement policies:
In October 2017, GPE updated its sustainable
development brief for its professional teams. This
increases requirements for assessing human rights
risks when sourcing materials. The client is also
working with BRE to review whether its EthicalLabour Standard and The APRES Eight Pathways151
model are appropriate for the business.
Cole says that the company prefers to collaborate
and work with contractors rather than to unilaterally
enforce systems upon them.
“Our partners are approaching the modern slavery
challenge in a variety of ways. Some are using theSedex platform, others are favouring the ELS, andthat’s fine too. We will work with them to find theright solution.” Cole says.

Looking forward
GPE is exploring the possibility of wider data sharingof risk management data across the sector.
“If we knew that one of our suppliers had already beenchecked and assessed by other responsible contractors
and clients, it would give us some comfort, eventhough it wouldn’t guarantee that the risk had been
entirely mitigated,” Cole says.
She suggests that building ratings systems such as
BREEAM, LEED and SKA could include a greater
focus on human rights and modern slavery criteria toaccelerate uptake of better standards and practices in
the industry.

“As most major clients and developers arefamiliar with these kind of ratings tools,
this may well help to ramp up uptake
across supply chains.” Cole says.

151

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See the BRE and APRES sections in this report’s Industry Initiatives roundup

Head of strategic procurement Andy Fulterer joineda cross-departmental group to review company
procedures in the light of the Modern Slavery Act.
One area of focus was auditing. The company had
been using Achilles BuildingConfidence for the past
decade for health, safety and quality audits of its
supply chains.
“Over the past decade, we’ve been gradually adding inquestions on environmental and sustainability issues,
ethical sourcing and child labour. So it was a logicalprogression to develop sections on modern slavery,”
Fulterer says.
More than 20 major contractors work with Achilles,
often sharing suppliers. To reduce the administrative
burden on the supply chains, the companies
decided to take a standardised approach to adding
modern slavery questions to their prequalificationquestionnaires.
After passing PQQ stage, Achilles auditors visit the
suppliers to check that the paperwork matches statedpolicies and practices.
Audits are booked in advance. “The idea is not tocatch suppliers out, but to upskill them,” Fulterer
explains. “We acknowledge that smaller companies
in particular may need more help on tacklingmodern slavery.”Direct and non directly employed labour
Lendlease collaborated with a major client on a labour
audit of a central London site. Although no major
problems were found, Lendlease has since embedded
a five minute awareness video on modern slavery into
its induction process. This was partly to reach the large
numbers of non-directly employed labour that were on
its sites.
As part of Lendlease policy, staff must undertakean online ethical training course once a year, inwhich they watch a video and answer questions.
The course is updated annually to reflect changes
in legislation.

Construction and the Modern Slavery Act

Site security
Before starting on site, workers have to enrol online,
submitting details of their right to work permits,
Construction Skills Certification Scheme cards foradvance checking. Documentation is physicallychecked when they turn up for work.
The company uses MSite for security, and electronicsystem which checks the validity of CSCS cards
against the official CSCS database, run by CITB. It
uses biometric access to identify workers throughfinger prints or hand geometry.
“MSite has been mandatory across all Lendlease sites
over the past two years. We have also centralised oursystem, so workers can be managed across all oursites,” Fulterer says.

Procurement strategy
The company is currently aligning its procurement
processes to the recently launched BSI ISO 20400
standard.
“Action Sustainability is helping us identify any gaps
in procurement process, from specification to site,”
Fulterer explains. “Our plan is to have our procurementaligned with ISO 20400 in the first half of 2018. We are
expecting an action plan to come out of that.”
He adds that he would like to see more standards thatmake products more traceable, such as FSC for timber,or BES 6001 for brick and rebar.
“We’re happy to put our weight behind an industry
standard if it’s creating the right momentum andreducing effort for all of our suppliers. People have
limited resources, if we can agree on a standard, it
could make everyone’s life easier.”

Actions and collaborations
Lendlease is one of more than 65 partners of the
Supply Chain Sustainability School, helping to develop
its initiatives and training materials for construction
supply chains.
Fulterer stresses how collaboration with the school is
helping to save time and resources, particularly in risk
mapping.
“We quickly found a fairly common supply chain
between most main contractors. Even if the product is
not coming from exactly the same supplier, it is often
from the same region. So it makes sense for companies
to work together.”152

Tackling Exploitation in the UK

Marshalls
Marshalls has been manufacturing andsupplying hard landscaping products sincethe 1880s. In the UK, it directly employs
more than 2,500 people and has 52
operational sites.
Last year CIOB reported on the company’s
exemplary work in India and other highrisk sourcing countries, where it has
been addressing the social, economic andcultural causes of slavery. 152 This casestudy focuses on UK operations.
“As members of the Ethical Trading Initiative, we
had done more work on slavery internationally thandomestically,” says group marketing and sustainability
director Chris Harrop, “However, the Modern
Slavery Act prompted us to look at the UK. It was acase of challenging assumptions right through theorganisation.”
Elaine Mitchel-Hill, business and human rights
lead at the company adds: “From a human rights
perspective, we wanted to seek out where we might
be unintentionally doing harm, and to put that right.
Wherever we work in the world, modern slavery
victims are at the centre of our strategy.”

Working with Hope for JusticeMarshalls entered a long term partnership agreementwith anti-slavery NGO Hope for Justice in January
2017.
The organisation was chosen because its expertise
encompasses prevention, training, education,
investigations and remediation.
“We know our limitations as a business. We wanted
to have a plan in case we did discover an incident,”
Mitchel-Hill says.
If a problem is suspected in UK operations, but there
is no immediate threat to life, Marshalls policy is tocontact law enforcement, the GLAA and Hope for
Justice simultaneously, allowing all three parties toliaise on the approach that will best protect victims
and support evidence gathering.

CIOB, Building a Fairer System: Tackling Modern Slavery in Construction Supply Chains, July 201687

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Tackling Exploitation in the UK

As part of its remediation policy, Marshalls may offer
employment to modern slavery survivors that are
eligible to work.

Anti- slavery ambassador Karen Preiss, who works
in procurement, identified temporary labour as apriority area of activity.

“We’re taking a flexible approach, on a case by casebasis. Working with Hope for Justice enables us tohave options rather than a standard process,” MitchelHill says.

Marshalls decided to take a strategic approach on
temporary labour. It commissioned Hope for Justice
to run a training programme with human resources
specialist De Poel, which manages 65 agencies
supplying temporary labour to Marshalls.

Training
Marshalls’ 2,500-strong workforce in the UK receives
online training on modern slavery every year.
Hope for Justice is providing more detailed training
for employees in pivotal roles, including board
directors, health and safety experts, specialists fromthe procurement, human resources and supply chain
teams and operational staff.
“We’re giving extra help to anyone who is more
likely to come into contact with modern slavery risk
indicators in their day jobs,” Mitchel-Hill says.

Anti-slavery ambassadors
Marshalls is appointing modern slavery ambassadorsin strategic parts of the business. Ambassadors receive
in-depth training tailored to their business functions.
The first three ambassadors to be appointed workin the registered installer management, commercial
projects and procurement departments.
Dave Jessop is responsible for Marshalls’ UK-wide
register of certified patio and driveway installers,
liaising with clients in the housing sector. Since
becoming a modern slavery ambassador, he has
conducted awareness training in roadshows in 14
strategic locations, reaching 230 businesses and 507
individuals. He has also communicated with theregister’s 1,200 members on how to spot the signs ofmodern slavery, how to report and stay safe.
Results have been positive so far: installers havestarted reporting information that is leading to police
and agency investigations.
Jessop says: “Installers are fully supportive of the fightto tackle slavery. They are motivated by an economic
argument, that if someone can undercut them andtake away their work using forced labour, this has adirect impact on their business.”

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The programme was devised to increase the agencies’
awareness of systematic exploitative and business-likenature of trafficking.
Mitchel-Hill says:“Armed with new understanding, a lot of
temporary labour providers said that theywould look at applicants in a different
way, and were running back to theiroffices to review recent incidents.”
The most recent anti-slavery ambassador to beappointed is Mike Plaster who works in thecommercial projects team. Marshalls is planning toappoint two more ambassadors in 2018.

Consumer transparency – the Ethical Risk
Index
Marshalls launched its Ethical Risk Index in thesummer of 2017, which demonstrates how its stone
products are sourced in various regions of the world.
The ERI is based on a combination of elements:
information on risk factors in the source countries aswell as data from independent audits. The rating takes
into account 10 different measures including supply
chain awareness, environmental practices and healthand safety.
The ratings now appear alongside each of Marshalls
products on its website.
“The ERI is to give customers a better insight, so thatthey can make more informed decisions about thestone they are purchasing,” Harrop says.

Construction and the Modern Slavery Act

Further initiatives:
Supply chain engagement.
Marshalls is using software platform Vinci Platforms
to get closer to its supply chains. All suppliers have had
online slavery training via the platform, and have readand agreed to the company’s anti-slavery statement.
“We’re encouraging suppliers to engage with us on
any particularly challenging areas that they would liketo work on. Using an IT based system gives us more
traceability,” says Mitchel-Hill.

Code of conduct launch
M-Way - Marshalls’ new supplier code of conduct
and ethical sustainable procurement policy - not only
sets out its standards and expectations for the supply
chain, but also asks the suppliers to give feedback.
“We want suppliers to tell us if we are not behaving
to our own standards,” says Harrop. “It’s a two way
conversation.”

Living wage
Accredited by the Living Wage Foundation, Marshalls
has committed to ensuring that the living wage isapplied throughout its business operations in the UK.
This includes any temporary labour.

West Yorkshire Anti-Trafficking andModern Slavery Network
Marshalls was the first business to join the West
Yorkshire Anti-Trafficking Network. The company isalready using information shared with the network to
send out alerts of modern slavery risks to its registeredinstallers.

ELS
Marshalls was the first organisation to be BRE EthicalLabour Standard BES 6002-accredited in February 2017.

Education abroad
Marshalls is running an education project inVietnamese quarries to assist the independent antislavery commissioner’s drive to make communities
more aware of modern slavery risks.

Frustrations“When I talk to other company directors, their main
fear is that the media will take news of slavery foundin their supply chain as guilt of the company, rather
than celebrate the fact that they have found problems
that they are trying to fix.” Harrop says. “This isprobably the biggest barrier to change in the industry.

Tackling Exploitation in the UK

He adds that, as a supplier, his company has beeninundated with client questionnaires of dubious value.
“At times we’ve been receiving up to threequestionnaires a week, with threats that we will bedelisted if we can’t guarantee that our supply chainsare slavery free. As a responsible business, we areunable to sign, because apart from the self employed,
no one can make those kinds of promises. It feels likea totally redundant exercise.”

Skanska
Swedish construction group Skanska
was founded in 1887 and operates in
Europe and North America. Its UK
operation, established in 2000, directly
employs around 6,000 people. Skanska
UK’s revenue was £1.68 billion in 2016,accounting for 10% of the company’s
global business.
Skanska directly employs a proportionately highnumber of workers in its specialist operations, which
include piling, highway maintenance, civils, utilities
and M&E. The company has been using a preferredsupplier list for standard recruitment since 2010.
In the past few months the company centralised andslimmed down its list of temporary worker agencies.
It now partners with an agency aggregator to gain
more control and understanding of the agency spend.
“Previously, the regions and divisions were dealing
directly with the agencies. Now we have fullvisibility of the metrics and make up of ourworkforce right across the business,” says Harvey
Francis, group HR director and executive vicepresident at Skanska UK.
He adds that the slimmed down agency list is still“probably a little larger than we would like it to be”,
but reflects the skills requirements of Skanska’s diverse
operations. Nevertheless the company now works withfewer than ten labour-only agencies.
“This is a significant reduction, but it helps us manage
our relationships better,” Francis adds.
Every year, a third party provider carries out a two-day
audit of Skanska’s labour suppliers. The vetting process
is combined with detailed labour checks
on site.
As a result, Francis believes that Skanska’s greaterrisk of labour abuse lies within subcontractors in the
supply chain.
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Supply chain engagement
Skanska spends nearly 80% of its revenues with its
supply chain, of which 70% is with SMEs. Francis
says that much work is done to engage the supply
chain on company values during tender processes.
Sustainability KPIs are also built into performance
evaluations of Skanska’s own procurement team.
“We build long term relationships and make it clearthat we won’t have anyone working with us who is notprepared to work ethically and transparently. Suppliersmust demonstrate that they have policies in place tostop labour abuses occurring within their areas of
responsibility, he says, adding:“We regularly carry out supply chain audits tocheck specific labour welfare issues, such as whether
payroll is running correctly, and whether workers arereceiving their due holiday pay.”
Skanska is rebalancing its selection criteria to place
more emphasis on the behaviours and collaborativeskills of teams. On some projects, commercial criteria
accounts for only 30% of the overall score.153
In an industry such as construction which has cash
flow issues and small margins, Francis believes
that clients must be prepared to pay a fair price,whilst contractors have a responsibility to price work
realistically.
“Price is important,” he says, “But it can never be an
excuse for poor, unsafe or unethical practice. That’s avery short term mindset.”

Code of conduct
Skanska revised its code of conduct for company
employees in 2016, expanding sections on human rights
and modern slavery. Every Skanska employee receives
training on the code within four weeks of starting work.
Their training is refreshed every two years.
The company has also published a separate code ofpractice for suppliers.
“We expect this to be applied back to back along our
supply chain, in the same way as our commercial
conditions,” Francis says.
Suppliers found flouting the law or breaching ethicalguidelines can be removed from preferred supplier
status. In less extreme cases, the company is prepared
to reengage with suppliers if they can demonstrate thatthey are making permanent improvements to theiroperations.

153

90

“Recently one supplier came back to us andacknowledged that they needed to make changes. We
supported them, and had some initial discussions
about how they would do this. Now we’re working
with them again, they’re the subject of regular audits
to ensure that they are doing what they promised,”
Francis says.

Worker engagement
Like many major contractors, Skanska is runninga modern slavery awareness campaign across its
projects. It has also set up a whistleblowing hotline,
run by a third party, which sends regular reports toSkanska’s ethics committee.
However, if a serious problem is discovered, company
policy states that Francis or another senior director
must be immediately informed.
“Any serious breaches are immediately referredto the ethics committee. We deal with every casethoroughly,” Francis says.
He adds that every member of Skanska’s 20-strong
senior management team conducts a formal site visit
every month, and that it’s not unusual for major
projects to receive leadership visits on a weekly or
bi-weekly basis.
“It was originally an executive health and safety visit.
We are now having broader conversations, asking
workers how they are being treated by Skanska andtheir employers.”
These interactions are kept as informal as possible.

“This gives us a very good sense of how
things are being managed. There is no
substitute for face to face contact. In mostcases, people are not reluctant to give
their opinions.
We can’t reach everyone, but thisshould be seen in the context of all ourother initiatives such as the hotline, theprocurement processes and training andawareness campaigns. We’re doing as
much as we can, although it’s never going
to be enough.”See “Profit with purpose” Skanska case study in the Changing the Model section

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

Acting on values

The vetting challenge

Skanska Group has demonstrated that it is prepared
to walk away from jobs, clients or regions that may
compromise its social or environmental standards.

Jacobs acknowledges that tackling fraudulent
documents is a major industry challenge.

“These things are non-negotiable, and come out of
our company values. If you want to be a responsible
business that is going to be operating in ten or 20
years’ time, you have to be prepared to lead on ethicalstandards, whether or not clients are driving you to doit,” Francis says.

“Resources are stretched. Everyone is busier thanthey were five years ago. Companies are being asked
to check more and more documents. The problem isthat the responsibility is being driven right down the
supply chain. Often it’s the people with the lowest levelor experience or resources that are being forced tomake decisions.”

Wilson JamesHe adds that the fast turnaround of workers on site
presents additional challenges:

Specialising in construction logistics, site
security and business services, Wilson
James turned over £130 million in 2016
and is growing at the rate of roughly 10%
a year. Wilson James directly employs
3,000 people in the UK. Major clients
include Heathrow Airport, Stanhope
and Lendlease.

“Vetting has become a cottage industry. When I wasworking for a contractor on major projects such as the2012 Games, we had a full time vetting team, but they
were finding it difficult to get to the facts. By the timethey had worked their way through subcontractors tolabour suppliers, workers had moved on.”Responding to the Modern Slavery Act

He would also like to see a streamlining of social
auditing processes. “Social auditing is a step in theright direction, but we’re finding some systems
clunky and not that intuitive. People are under a lotof pressure. If systems aren’t user-friendly, it’s going
to be hard to make them comply.”“As a supplier, we’ve noticed a lot of major contractors
changing terminology in their contracts to tighten
up pre-employment vetting requirements,” says Peter
Jacobs, past president of the CIOB and managing
director of Wilson James’ construction logistics
division.
But he adds; “I think there’s still some confusion forpeople outside the industry as to where the risks arein construction, who needs to take ownership of thoserisks, and how people are employed in this sector.”

Labour
Because it is active in security and aviation industries,
Wilson James has a larger than average vetting teamcompared to other construction suppliers.
The company recently carried out a rationalisation
exercise, cutting two thirds of its labour agencies.
“We retained those companies with the best processes
and competencies,” Jacobs adds.

Jacobs is recommending that responsibility forchecking documents is pushed back up the supply
chain to clients and main contractors.
“This will really make a difference. It will shift theculture,” he says.

But he believes that the industry is on the beginningof its human rights journey.
“I would compare where the industry is today with
where it was on health and safety around 15 years
ago. It was at that point that CDM legislation was
introduced, and companies started engaging inbehavioural safety training. This is where we started
to really make a difference.
“We’ve got to get our heads around modern slavery
because this is important. It’s not just a government
drive on laws and regulations. It’s about looking after
the welfare of our people on site. There are a lot ofdecent people in construction If they really knew
how some people were being treated by ruthlessgangmasters, there would be a bigger outcry.”91

Construction and the Modern Slavery Act

Tackling Exploitation in the UK

ACKNOWLEDGEMENTS
Many organisations and individuals generously contributed their time and expertise for thisreport. Here follows a non-exhaustive list of acknowledgements
CIOB apologises for any omissions, but would like to thank:

Action Sustainability

Heathrow Airport

amfori

Mace Group

ArcadisMarshalls Group

Baroness Young of Hornsey

Migrant Help UK

University of Bath School of Management

The Modern Slavery Helpline and Resource Centre

Be Onsite

The National Fraud Intelligence Bureau

BRE Group

The National Police Chief’s Council

Building Responsibly

Police Service of Northern Ireland

The Cahn Group

Resilient.WorldThe Chartered Institute of Procurement and Supply

SAFERjobs

The Co-op GroupThe Salvation Army

University of Derby

University of Nottingham Rights Lab

The England Illegal Money Lending TeamThe University of Salford

Ergon Associates

The Scottish Government

The Gangmasters and Labour Abuse Authority

Sedex

GMB Union

James Sinclair

Great Portland Estates

Shayne Tyler

Caroline Haughey QC

Sir Robert McAlpine

Hope for Justice

Skanska

Human Trafficking Foundation
Kevin Hyland OBE
The Institute for Human Rights and Business
Impactt UK
Land Securities

Stronger Together
The Supply Chain Sustainability School
TISCreport
The Welsh Government

LendleaseWest Yorkshire Anti-Trafficking
and Modern Slavery Network

Loughborough University

Wilson James92

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