Modern Slavery Bill

Baroness Kennedy of Cradley Excerpts

Wednesday 10th December 2014 Lords Chamber

[Baroness Kennedy of Cradley (Lab)]

My Lords, I, too, add support for the amendment moved by the noble Baroness, Lady Cox. This is a very important issue, affecting a group of extremely vulnerable workers, so it is right and fundamental that it forms part of the Bill. The change to the overseas domestic workers visa back in 2012, tying domestic workers to their employer, was too heavy-handed a response when you look at the number of domestic workers involved and the vulnerability of those workers. In 2010, visas issued to domestic workers accounted for just 6% of all employment-related visas issued. At the time of the change, the Government argued that this visa was a route to settlement that was abused. However, very few overseas domestic workers were granted the right to settle; between 2006 and 2010, an average of just 700 domestic workers a year were given the right to settlement. That figure taken as a percentage of the 2013 settlement figures represents less than 0.5%.

I understand, as the Government will argue, that because of their isolated working conditions this group of workers was vulnerable to, and suffered, abuse before the change in visa rules. But the research by Kalayaan, as others have said, has shown that abuse and exploitation has increased as a result of the new visa rules, figures that the Minister in the other place made clear are not disputed by the Government. This visa change has created the perfect storm, with work carried out in isolated conditions, employers having excessive power afforded to them and a legal system that offers absolutely no protection. It is therefore unsurprising that the abuse has increased.

The Minister will no doubt talk about having stronger pre-entry checks, a stronger written contract with explicit terms and conditions and more information given to overseas workers on their rights but, as the noble Baroness, Lady Hanham, said, the effectiveness of those provisions has yet to be proven in practice. Also, these actions are not mutually exclusive to any other action; it is not a choice between stronger support mechanisms or a change in the visa rules—we should be doing both.

The amendment has a lot of support inside and outside this Chamber. Three parliamentary reviews have supported a change to the visa situation for overseas domestic workers. I hope that the Government can support it too, and include this amendment, or a version of it, in the Modern Slavery Bill.

[Baroness Hamwee]

My Lords, it happens here—it happens even in Scotland, as we have heard, that most civilised country.

A number of noble Lords have used words such as “unimaginable” but, like the noble Baroness, Lady Hanham, I can only too well imagine the card—and I share her concerns about the card itself—being slipped into the passport as it is handed over. Of course, the passport is then very often taken by the employer.

I do not want to repeat the very powerful speeches made by so many noble Lords. I was grateful to hear from a number of people, including, most strongly and emphatically, from the three workers themselves to whom the noble Baroness referred, and at the meeting that she organised with Virginia Mantouvalou, who has written a report. Clearly, it is far too long to read here, but one thing particularly struck me. She gives the history of the overseas domestic worker visa and the diplomatic visa. When the concession was originally introduced, it was from concern to enable workers who had been with a family overseas to come here. The comment was made that it was for “a humanitarian reason”—to look after the domestic workers—and look where we have got to.

At that meeting, Kate Roberts from Kalayaan explained how her organisation could no longer help workers who managed to find their way to it, which must be a tiny percentage, because the organisation has to explain the problem with the Immigration Rules. Indeed, it often cannot help because of threats from employers to workers about criminalisation.

A number of noble Lords have also said that we must remember the realities. Measures such as dealing more effectively at the port of entry are important, but they are not enough. One thing that occurs to me on that is that, at the border on exit, when there is suspicion that a girl is being taken abroad for a forced marriage—the border officials are trained to recognise this—there are arrangements whereby they can be taken aside to be interviewed. The noble Baroness is right to point to that. I do not see why it should not happen in the other direction. We need to think about the realities. What people seem to be able to do to get around formal systems is almost beyond our imagining, and it is the realities that we need to fix on.

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[Baroness Butler-Sloss]

My Lords, this is another modest amendment to allow the Government to look at the Gangmasters Licensing Authority at an appropriate time to see whether the functions, powers and duties of the licensing authority should be extended to cover other areas, which are extremely obvious, where it is well known that there is quite a lot of slavery and trafficking.

Two particular areas that I have in mind are the construction industry and the hospitality industry. One area of the hospitality industry is the laundry. Almost every hotel uses outsourcing of its laundry. There are serious concerns as to what goes on in some of the laundries. There is no doubt at all that there are serious concerns about what goes on in the construction business, particularly with people working on sites.

A very obvious example of that was the Connors case in Bedfordshire, where a Gypsy family, the Connors, picked up out-of-work, homeless people from soup kitchens and homeless centres and took them, on the promise of £80 a day, to work on construction sites. These people were kept in appalling accommodation in caravans, first working on construction sites in England, and then a whole lot of them were taken across to Sweden where they were working in the northern part of the country. It was not until a young Swedish boy, who had also been caught like this, walked 500 miles to Stockholm and went to the police, who rushed to the area where these people were locked up—not being paid a single penny, in appalling conditions—that they were identified as slaves and victims, and they did not even know it. However, one of them gave evidence to the informal inquiry led by Frank Field MP, of which Sir John Randall MP and I were members at the request of the Home Secretary. This particular victim gave very clear evidence of what goes on in the construction industry.

I understand entirely the scarcity of resources, so I am not asking the Government to extend the powers of the Gangmasters Licensing Authority. Indeed, Paul Broadbent would be horrified unless he had proper resources to manage what would have to be a larger enterprise if these two areas were taken into account. What I do not want is there to be inability on the part of the Government, when they have the money to extend the Gangmasters Licensing Authority, to find the proper legislative process to be able to do that. To put the matter in current usage, rather than faffing around looking for the right sort of place, if you have the power to do it, you do not have to do it until you can, but the power would be there so that you could do it in subsidiary legislation later. I hope that the Government will listen seriously to what I suggest. I beg to move.

[Baroness Kennedy of Cradley]

My Lords, I have Amendment 97A in this group, but I also support Amendment 97 in the name of the noble and learned Baroness, Lady Butler-Sloss, and Amendment 101A in the name of my noble friend Lord Rosser. Many people welcome the great job done by the GLA. In the sectors for which it is responsible, it has been extremely effective at raising standards and driving out poor performance. Ten years ago, given the context in which the GLA was established, limiting the sectors it covered made sense. But 10 years later the limit on the GLA remit now makes little sense.

Amendment 97A was recommended by the joint scrutiny committee, of which I was a member, to allow the remit of the GLA to be extended. As the noble and learned Baroness, Lady Butler-Sloss, said, many high-risk sectors fall outside the remit of the GLA, such as construction and hospitality—and I would add care and cleaning to that list. These sectors are high risk because they commonly use subcontractors, agencies and migrant labour. The work is seasonal and low paid, and workers often work on site and in isolated conditions. Therefore, these sectors need to be afforded greater attention and the workers need the extra protection given to them by the licensing regime of the GLA.

As I have said, the GLA is widely recognised as being effective and is often cited as an example of best practice. Many people have called for its remit to be extended to such high-risk sectors, which is why the Joint Committee looked at it in some detail and agreed. It would be a mistake not to consider it now or, as the noble and learned Baroness said, in the future, which is why I support Amendments 97 and 101A that allow for that. These amendments also would allow the GLA to be given greater powers. I agree. The GLA would have the power, for example, to enforce payment of unpaid wages and the ability to fine businesses which have deliberately evaded licensing.

The sentencing and penalties faced by unlicensed and exploitative gangmasters also need addressing. Some very ruthless people are getting away with comparatively small fines. In 2013, an unlicensed gangmaster was convicted of exploiting more than 60 Filipino workers on dairy farms in the UK. Despite having made more than £700,000 through exploiting his workers and housing them in appalling conditions, he was given a 12-month suspended sentence and was asked to pay £45,000 in compensation over three years. We must review the sentencing guidelines for GLA offences. We cannot have a situation where cruel gangmasters see fines, in the words of the GLA,

“as a hazard of the job”.

I hope that we can amend this Bill to address these significant issues, as when there is inadequate preventive action, abuse occurs.

[Baroness Royall of Blaisdon]

My Lords, I shall speak to Amendment 101A in my name and that of my noble friend Lord Rosser, and I support the other amendments in the group. Like others, we are seeking an enabling power by regulations to allow the Secretary of State to expand the remit of the Gangmasters Licensing Authority into other sectors when he or she wishes to do so. In Committee in the other place, the Minister, Karen Bradley, said:

“The case has not been made for extending the GLA’s remit at this stage beyond the core areas the Act sought to address”.—[Official Report, Commons, 14/10/14; col. 480.]

I contest that point of view because, like other Members across the Committee, we have a deal of evidence to prove that there is a strong case for extending the GLA’s remit. But we are not forcing the Government to do that now; we are saying, as and when appropriate, please let us do it.

The introduction of legislation on gangmasters in 2004 has worked very well in protecting workers in the agriculture, horticulture and shellfish collection sectors. Widespread research from trade unions, charities and academics suggests that hundreds of thousands of migrant workers are routinely underpaid and overworked in dirty and dangerous jobs across the UK on farms, in care homes, providing cleaning services on the London Underground, in hotels and offices, and on construction sites, as others have said. Often employed by labour providers or gangmasters, many of these workers presumably have little idea of UK employment rights such as the national minimum wage, let alone the leverage to be able to claim them.

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[Baroness McDonagh (Lab)]

I shall speak to Amendment 98A and support Amendment 98. I start by declaring an interest as patron of the Lily foundation, an anti sex-trafficking charity operating in India and the UK. Is it not absolutely fantastic that we are here on all sides of the Chamber to support a Bill that we all want to see enacted? That is a very unusual occurrence. In that spirit of unity, I am pleased that this amendment is being supported by me and the noble Lord, Lord Hastings of Scarisbrick.

Our concern is that this clause on supply chains will turn out to be warm words and good intentions. Indeed, when assemblies all around the world have sought to phrase legislation in these terms, they have rarely been able to meet their objectives. If the Bill cannot meet its objectives, what then? That is what this small enabling amendment covers. It would allow the Home Secretary to intervene and require extremely large companies to risk assess, create an action plan and audit. We think this is a very simple thing to do and would welcome a meeting with the Minister to discuss it further.

Let me be clear about the companies to which this amendment would apply. I understand that the Government would be concerned if it were to apply to all companies. I understand that placing such a regulatory responsibility on SMEs would be extremely difficult. Indeed, our amendment would not even apply to large companies; it would apply to really large global entities, which are very specifically defined as companies with a turnover of £1 billion per annum. Not only that, there is a secondary locking qualifier, which is that they would be in the wholesale, retail, manufacturing and construction sectors, in which you find more people who are working in servitude in the supply chains.

I ask the Minister and the Government to accept this small enabling amendment. It is a safety net to ensure that all the hard work in tackling this terror will not have been in vain. If it is needed—and if the Bill does what is intended, it will not be needed—it will apply to a small number of companies. Behaviour change in the 124 companies which would qualify would have the biggest impact on the greatest number of people and would bring up the standards of all.

[Baroness Kennedy of Cradley]

My Lords, I support Amendment 98, which was moved by the noble Lord, Lord Alton of Liverpool.

The case for legislating for transparency in supply chains as part of the Bill has been well made and it is very welcome that it is being progressed by the Government through Clause 51. Now, as many noble Lords have said, the task is to get the detail of the legislation right and agree between us a well crafted clause that levels the playing field for business, informs investors, shareholders and consumers and drives change to end slavery in supply chains. I support Amendment 98 because it would do exactly that.

Amendment 98 would rewrite Clause 51 by adding, where necessary, elements of detail to ensure that it is more meaningful, effective and workable. As the noble Lord, Lord Alton, said, in line with the California Transparency in Supply Chains Act, which came into force in 2012, the amendment defines the threshold as not less than £60 million and, most importantly, includes the term “group undertaking” when determining the total turnover. That is important because it allows multinational companies that may have small operations in the UK to be covered by this legislation.

We all want the Bill to have global reach. Therefore, having a way to ensure the inclusion of all large foreign companies that provide services to the UK is vital. Clause 51 is ill defined in parts and Amendment 98 seeks to correct that in a number of ways. First, it suggests a simple change in the language to make the intent of the clause explicit. In the Modern Slavery Strategy the Government make it clear that they want this legislation to ensure that businesses investigate and report on modern-day slavery through the annual statements they are required to produce. It is therefore important that that aim is made explicit in the Bill. Subsection (4)(a) is consequently amended to confirm that the statement is specifically to “identify and address” the issue of slavery and human trafficking. It is its primary aim.

It is also important that the remit of this statement is more tightly defined. The clearer this legislation is, the better for business and consumers alike. Subsection (5) of Amendment 98 provides a framework for the statements. It makes sure that minimum disclosure measures are included in the Bill: the need for risk assessments; the need to set out who has been involved in identifying the risks; what actions have been taken to mitigate the risks; and what has been the impact of those actions. The “how” should be left to guidance. Without those minimum criteria, as other noble Lords have said, comparisons between companies will be impossible to make and the level playing field desired by good businesses will be difficult to achieve.

We also need to look to and learn from the Californian Act and not repeat its mistakes. The learning from the application of the California legislation to date also shows us why it is necessary to be clear in the legislation about what you want to achieve and what you expect business to report. In California hundreds of organisations have issued statements in line with the Act, but there is a wide variation in the information provided in those statements. Some have disclosed meaningless information, some have disclosed misleading information, and a few—perhaps worst of all—have thwarted the legislation and disclosed that they do nothing and are indifferent to the issue of slavery in their supply chains. For example, Caterpillar Incorporated, a multinational company reported to hold $89 billion in assets, which manufactures its products and components in 110 factories worldwide in high-risk countries such as India and Indonesia, issued a woefully inadequate statement. Krispy Kreme Doughnuts issued a statement of just 182 words, using them to say that as regards slavery it does not verify product supply chains, conduct audits of suppliers or require direct suppliers to certify materials.

Getting businesses to produce statements of that kind is not what this part of the Bill is about, and I do not believe it is what the Government intended it to be about. Clause 51 is not a paper exercise for businesses to write down in 200 words or less that they do not do any of this kind of work and do not intend to start. It is a serious measure that we need businesses to engage in and which good businesses want to engage positively with, properly and on an equal footing with each other. It is not fair that the good businesses that do excellent work, actively searching for evidence of exploitation, are being undercut and undermined. That is why having minimum criteria in the Bill is vital. Setting out those minimum criteria would not make the task more burdensome for business; the task—the production of the statement—remains the same. Minimum measures just give a framework for the task so that a level playing field between businesses is achieved.

Proper monitoring is also vital and, as the noble and learned Baroness, Lady Butler-Sloss, said, it is not currently clear how this part of the Bill will be properly monitored and enforced. Amendment 98 seeks to address that, too. Again, if we look to learn from the experience of the Californian Act, here some companies have ignored the Act completely. Research in January of this year quoted 85 companies as ignoring the legislation. That level of disregard is unacceptable, and we should make sure it is not replicated in the UK. Amendment 98 also ensures that a named government department receives and makes sure that the statements are easily publically available. It ensures that there will be consequences for blatant flouting of the legislation—as we have seen in California—by companies that do not comply or refuse to comply. Most importantly, it makes sure that compliance with this clause is a corporate responsibility. You need leadership from the top to change attitudes and make things happen.

I also very much support the requirement for a review after three years, which is included in Amendment 98. This part of the Bill in particular, as it is a completely new area of work, would benefit from a re-evaluation over a specified time period. Formally being able to hear the views of businesses, NGOs, trade unions and consumers on how this legislation operates in practice, and committing to bring forward changes where needed, would be a positive step forward.

I hope that the Government can accept much—if not all—of what is included in Amendment 98 and that they will look seriously at Amendment 98A in the name of my noble friend Lady McDonagh. She has clearly set out the impact multinational corporations can have in the fight against slavery. The 124 companies to which she referred, which operate in high-risk sectors and which have a combined turnover of approximately $1 trillion, can clearly influence the working conditions in tens of thousands of workplaces and help many millions of workers across the world. The power of this small group of companies is huge. They have the power to reform their business models, insist on inspection regimes, support local efforts to empower workers and insist on decent wages and formal contracts for all workers here in the UK and across the world. Her amendment brings home to us that we cannot rid the world of slavery without the help of big business.

The provisions in my noble friend’s amendment would enable the economic strength of these companies to be a force for good—something they want to be and something we desperately need them to be. Many if not all those companies understand the reputational damage and loss of both consumer confidence and market share they will suffer if they are found to be sourcing from suppliers which use exploitative labour. Most companies want supply chains that reflect their brand, not brands that reflect their supply chains, so I am sure that, like Amendment 98, this amendment will not be seen as a burden but an advantage. I hope that both amendments and what they set out can be accepted by the Government.

[Baroness Mobarik (Con)]

My Lords, I support the amendment in the name of the noble Lord, Lord Alton, and I am grateful to him for tabling it.

I have put my name to this amendment because it would do two important things. First, it will give businesses more certainty and clarity when producing the slavery and human trafficking statements required of them. That clarity is vital in saving businesses time. Secondly, however, it would also provide consumers with the information they need to hold businesses to account. Without the clarity that the amendment would provide, I am concerned that stakeholders, investors and campaigners will not be able to play their part effectively in helping stamp out the abhorrent practices that exist in some of our supply chains.

The media have done an excellent job in highlighting just how far slavery and forced labour have penetrated the supply chains for many of the goods and services that we take for granted, from basic foodstuffs to electronic goods, clothing and fashion. But modern slavery exists across the globe, and whichever form it takes, business supply chains are involved in some way or another. Slavery in supply chains is closer than we often realise. A couple of weeks ago, the owner of a bed factory in West Yorkshire that supplied retail chains such as Next and John Lewis was charged with human trafficking and slavery offences.