Building a Fairer System: Tackling modern slavery in construction supply chains

Summary

The Chartered Institute of Building (CIOB) is calling for greater industry collaboration to eradicate unfair labour practices. Clients and tier one organisations need to take greater responsibility for their supply chains. Priority should be given to tackling illegal recruitment fees, according to a new report Building a fairer system: tackling modern slavery in construction supply chains, launched today (Wednesday 13 July 2016).

The report, produced in consultation with a number of businesses and NGOs, including Amnesty International, Verité, Engineers Against Poverty and the Institute for Human Rights and Business, examines the root causes of slavery, and sets out priority actions for moving the industry towards greater transparency.

Slavery remains a problem hidden in many sectors. The International Labour Organization estimates that there are 21 million people in forced labour around the world, generating profits in the private economy of $150 billion. Interpol estimates that only 5 to 10 per cent of cases are ever reported.

With its fragmented supply chains, opaque procurement processes and high demand for migrant labour, the construction sector faces a unique set of challenges in tackling human rights abuses. It is a priority area for the UK’s first Anti-Slavery Commissioner, Kevin Hyland OBE, who writes a foreword for the report.

Building a fairer system examines how workers from developing countries become tricked or coerced into paying illegal and extortionate recruitment fees, and, once in debt, become vulnerable to exploitation in their place of work. Abuses range from forced or bonded labour, late payment, unsanitary living conditions, unfair deductions from wages, withheld passports and loss of freedom of movement, lack of representation, violence, intimidation and physical abuse.

The report also examines how faults in the procurement process allow exploitative practices to remain hidden in building materials supply chains. It includes a series of case studies and recommendations from organisations that are working to shift cultural practices and norms:

• How ethical recruitment firm FSI Worldwide‘s integrated cross-border operations are eradicating illegal recruitment fees
• The steps that CH2M has taken to implement a new global worker welfare policy
• Hewlett Packard’s move to direct labour
• Qatar Rail’s worker welfare strategy
• Marshalls’ ten-year initiative to protect vulnerable children and migrant workers in stone quarrying communities
• Bechtel’s “bottom up” approach to tackle exploitation in metal mining.

Building a Fairer System is part of CIOB’s ongoing campaign responding to changing legislation and international protocols. The UK Modern Slavery Act, which came into force in 2015, requires UK organisations with a turnover of more than £36 million to report on how they are dealing with human rights issues in their supply chains. Other forces reshaping the industry include the California Transparency in Supply Chains Act of 2010, the EU Non Financial Reporting Directive and the UN’s Sustainable Development Goals for 2015.

In parallel to the report, CIOB is collaborating with specialist providers on a series of training packages and is preparing an industry toolkit, to be launched later in the year. The CIOB is making the case that ethical innovation will be a powerful differentiator for businesses and essential for future-proofing brands as well as improving the global reputation of the sector.

Anti-Slavery Commissioner Kevin Hyland OBE said:

“With the culture of transparency becoming the norm in the era of globalised communication, having and showcasing sustainable and ethical practices is the only way forward and indeed an excellent market opportunity. Companies who opt for a model of secrecy will find they are no longer viable, as NGOs, journalists and consumers are increasingly able to hold them to account. Instead, those who lead the way with transparent, ethical and slavery-free supply chains will become the companies of choice and the new market leaders.”

CIOB Chief Executive Chris Blythe said:

 “CIOB’s core values are founded on the principles of ethical business behaviour. We are calling on our thousands of members and partners to ask more searching questions of their colleagues, suppliers and clients. Strong leadership is required, as is the willingness to take more responsibility, both individually and at corporate level.

 “Ethical procurement processes should be embedded into the heart of operations. Organisations need to become proactive, holding subcontractors and suppliers to account through more stringent clauses and penalties. And the eradication of illegal recruitment fees must be our priority.

 “Our journey towards the eradication of slavery will take decades and demands collective action, as is reflected by the multiple contributors to this report. Professional and private organisations need to come together to solve these complex problems and to make a lasting difference.”