Five on Friday – Five Recent Developments that We’ve Been Watching Closely - April 2018

by Foley Hoag LLP - Corporate Social Responsibility
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It’s Friday and time for another overview of developments in the field of business and human rights that we’ve been monitoring.

This week’s post includes: two new reports looking at corporate compliance with the U.K. Modern Slavery Act and best practices with respect to efforts to address the risks of forced labor; and the release of a “Frequently Asked Questions” document by the U.S. Department of Homeland Security regarding the presumption that goods made by North Korean workers are made with forced labor.

  • On March 5, U.S. Customs and Border Protection (“CBP”) published a notice with respect to a new Withhold Release Order pursuant to the prohibition on the importation of goods made in whole, or in part, with forced labor. The Order was specific to toys made by a specific manufacturer in China. Notably, this was the first Withhold Release Order issued pursuant to the forced labor prohibition since September 2016. Many observers are waiting to see whether CBP will adopt a more aggressive approach to enforcement of the forced labor prohibition under Commissioner Kevin McAleenan, who was sworn in on March 20. Commissioner McAleenan has previously stated that “CBP is committed to establishing a strong and effective interagency response to human trafficking and forced labor.”
  • On March 25, KnowTheChain published a report analyzing the efforts of more than 100 companies in the information and communications technology (“ICT”) sector to comply with the U.K. Modern Slavery Act.  Of the 102 companies evaluated as part of KnowTheChain’s research, only 79 have actually published a Modern Slavery statement. KnowTheChain found that only 14 of those 79 statements were compliant with the requirements that disclosures should be: published on corporate websites with a link available on the homepage; approved by the Board of Directors (or equivalent); and signed by a director (or equivalent). Later this year, KnowTheChain intends to release its second benchmarking report with regard to the ICT sector’s efforts to address the risks of forced labor.
  • On March 29, the Business & Human Rights Resource Centre released its latest corporate legal accountability bulletin. This edition of the quarterly bulletin focuses on the #MeToo movement and litigation and legislation related to gender-based discrimination in the workplace. The bulletin highlights cases brought in jurisdictions around the world alleging that companies have either discriminated on the basis of gender or taken insufficient action to address acts of sexual harassment.
  • On March 30, the U.S. Department of Homeland Security (“DHS”) published a “Frequently Asked Questions” document with respect to North Korea-specific provisions of the Countering America’s Adversaries Through Sanctions Act (“CAATSA”). As summarized in a previous post, CAATSA created a presumption that goods made by North Korean citizens or nationals, anywhere in the world, are made with forced labor. As noted in the FAQs, an importer seeking to import goods that are subject to the presumption must provide “clear and convincing evidence” to overcome the presumption. DHS further recommends that companies “review due diligence best practices and closely reexamine your entire supply chain with the knowledge of high risk countries and sectors for North Korean workers.”
  • On April 3, the Business and Human Rights Resource Centre released a new report, Modern Slavery Reporting: Case Studies of Leading Practice. The report highlights corporate best practices with regard to: supply chain transparency; integration of modern slavery into the overall management of human rights-related risks; engagement with suppliers; engagement with workers; responsible recruitment; and access to remedy. The best practices were identified based on a general review of statements published in the Modern Slavery Registry as well as a specific review of statements published by companies in the FTSE 100, as previously published here.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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