Proposed updates to the Modern Slavery Act under the Immigration and Asylum Bill

On 30 June, the Immigration and Asylum Bill (the “Bill”) was published, setting out, among other things, proposed reforms to the current reporting obligations under s.54 of the Modern Slavery Act 2015 (“MSA 2015”). 

Section 54 requires organisations with an annual global turnover of £36m or more, which are doing business in the UK, to report each financial year on the steps they take to prevent modern slavery in any part of their business and supply chains. The MSA 2015 does not prescribe what the statement should contain, and there has been no known instances of enforcement for failure to make a statement. This blog considers the provisions in the Bill that could change this approach, and what this means for organisations operating in the UK.

Mandatory reporting requirements

Clause 44 of the Bill introduces the requirement that modern slavery statements must comply with the obligations set out in the new Schedule 4ZA. These reflect current recommendations under s.54(5) MSA 2015 and add more prescriptive disclosure obligations, including information about where the risks of slavery and human trafficking lie in the relevant entity’s operations and supply chain, the steps it has taken to assess and reduce or remove that risk, its policies and due diligence processes relating to slavery and human trafficking, and the training for its staff. An entity is also required to assess how effective it thinks it has been in ensuring that slavery and human trafficking is not taking place in its operations or supply chains, with reference to appropriate key performance indicators to measure any progress. 

If an entity does not take any steps to assess or reduce the risk of slavery and human trafficking, or does not implement any of the other aspects which are the subject of disclosure obligations, it is required to state this in its report and explain why. The new requirements will therefore function as “comply or explain” obligations. 

Approval of statements

Clause 45 of the Bill introduces a new provision that allows a parent organisation to approve the modern slavery statement on behalf of its subsidiaries, marking a departure from the current legislation that is silent as to the practicalities of how group-wide reports should be approved. While this will ease the administrative burden for subsidiaries, it will also require increased oversight from parent companies and more communication so that the parent company is able to satisfy its obligation. 

Under clause 45(6C), the statement must include a declaration by the director (or equivalent) signing a statement that it is accurate to the best of their knowledge and belief. This will require steps to be taken to ensure an understanding of the operations of both the parent company and the relevant subsidiaries so as to be able to make the declaration in good faith. In addition to the transparency requirements set out in the Bill, this requirement is likely to encourage subsidiary companies to improve their documentation and due diligence processes so that they can adequately demonstrate to their parent companies the necessary information for the purposes of approval.

Penalties for non-compliance

Currently, failure to publish a modern slavery statement allows the Secretary of State to apply for an injunction which, if ignored, will result in the company being in contempt of court and at risk of an unlimited fine. However, there has been no enforcement of non-compliance. Clause 49 of the Bill introduces the ability for the Secretary of State to impose a financial penalty on entities which fail to comply with their duties under s.54 MSA 2015. Such amount could be up to the higher of 1% of the organisation’s turnover and £1 million. 

It is also worth noting that the relevant provision refers to failing to “comply with a duty imposed by or under this Part”, which is not limited simply to publishing a modern slavery statement. The detail of any enforcement regulations remains to be seen, but these duties could also include the approval and declaration in respect of a statement, and the substance of the content itself. 

Comparison with other jurisdictions 

The UK was a frontrunner when it introduced the MSA 2015, with Canada and Australia following suit with their modern slavery reporting regimes. Multiple European jurisdictions also have reporting obligations in place, such as in Norway, Sweden, France and Germany. 

However, the UK is now seen to be lagging behind its international peers in respect of mandatory human rights due diligence and forced labour import bans. The US implemented the Uyghur Forced Labour Prevention Act a number of years ago, and the EU is preparing for its Forced Labour Regulation, which will apply from December 2027. Most recently, Australia has announced its plan to introduce a new criminal offence for companies with an annual revenue over AUD 100 million which fail to prevent modern slavery in their supply chains. Companies which are able to demonstrate that they have taken reasonable steps to prevent modern slavery will be granted a defence under the legislation, the details of which will be subject to a consultation. The US, EU and Australian laws impose consequences for failing to address modern slavery, while the UK legislation still focuses on disclosure, rather than action.

Next steps

The Bill still has some way to go through Parliament and is currently at the Committee stage, which is slated to end by 3 November 2026. However, it would be sensible for companies to start reviewing their current modern slavery reporting and identifying where any gaps might lie. The Home Office’s Statutory Guidance published in March 2025 is a helpful guide for thinking about disclosure recommendations and the process and practices that underpin them. Companies are advised to keep a watchful eye on the direction of the UK developments, while also ensuring they comply with their obligations in other jurisdictions where applicable.