The coming into force of Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act, SC 2023, c 9 (the “Modern Slavery Act”) on January 1, 2024 was a large step forward by Canada in its contribution to the fight against modern slavery globally – an intention particularly addressed in the preamble of the Modern Slavery Act.
Under the Modern Slavery Act, and as touched on in our article on this topic, companies that meet the thresholds identified in the Modern Slavery Act will be required to review their supply chains and identify any risks of forced labour and child labour being used, as well as identify any steps taken to manage the risk.
Such investigations will form the basis of a report that is required to be filed with the Minister of Public Safety and Emergency Preparedness before May 31 each year. By enacting the Modern Slavery Act, Canada has followed in the footsteps of other countries that have imposed similar reporting requirements in an effort to combat modern day forms of slavery.
Legislation imposed by other Commonwealth countries
Legislation addressing modern day forms of slavery, including forced labour and child labour, has already been adopted by and in force in other Commonwealth countries. This includes the United Kingdom and Australia for several years prior to Canada’s enactment. Entities that may now find themselves subject to reporting obligations under Canada’s Modern Slavery Act may already be subject to, and reporting under, modern slavery legislation in the United Kingdom and Australia. In brief, the legislation in the two countries imposes the following reporting obligations on companies.
United Kingdom
- Enacted in 2015, Part 6 of the United Kingdom’s Modern Slavery Act 2015 (“UK Act”) requires organizations that are captured under the definition of “commercial organization” as defined in the UK Act, and that supply goods or services and have a total turnover of not less than an amount prescribed by regulations, to prepare a statement on slavery and human trafficking for each financial year of the organization.
- The UK Act sets out both mandatory and optional information to be included in the slavery and human trafficking statement, as well as the necessary approvals and signatures required on the statement depending on the type of organization (such as body corporate, partnership, limited partnership) preparing the statement.
- The statement must identify the steps taken by the organization during the financial year to ensure slavery and human trafficking are not taking place in any of the entity’s supply chains or in any part of its own business, or expressly state that it did not take any steps.
- The statement must be published on the organization’s website. Or, if the organization does not have a website, the organization must be prepared to produce a copy within 30 days of receiving a written request from anyone for a copy.
Australia
- Enacted in 2018, Part 2 of the Modern Slavery Act 2018 (“Australia Act”) requires an entity that fits within the definition of “reporting entity” under the Australia Act to provide to the Minister a modern slavery statement for a reporting period.
- The Australia Act details the mandatory information that must be included in the modern slavery statement, as well as the approvals and signature requirements required depending on the type of entity completing the report and whether the report is a single report or prepared jointly with other entities.
- Under Section 18, the Minister is required to maintain a Modern Slavery Statements Register on the internet that is available for the public to access free of charge.
- Notably, under Section 6 of the Australia Act, an entity that meets the requirements of subsection (2), which require that the entity is an Australian entity (as defined under the Australia Act), or carries on business in Australia (as defined under the Australia Act) can volunteer to prepare reports in compliance with the Australia Act for one or more reporting periods by giving written notice to the Minister during a defined time period.
Conclusions
With the first round of reports under the Modern Slavery Act for most entities and government institutions to be filed no later than May 31, 2024, it remains to be seen how companies that are currently subject to reporting obligations in other jurisdictions may attempt to adjust their reports to address their reporting obligations under Canada’s Modern Slavery Act.
A company can be found liable for a fine up to $250,000 for failing to comply with the Modern Slavery Act’s reporting requirements, and directors and officers can face similar liability exposure. Businesses that find themselves subject to reporting under Canada’s Modern Slavery Act should be careful to adhere to the timelines imposed and include all mandatory information when attempting to use reports prepared for other countries as the base for their Canadian report.
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