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1 Mar 2017

Jane Moyo, Ethical Trading Initiative

French "duty of care" law for companies: similarities & differences with UK Modern Slavery Act

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...NUMBERS: The UK law has greater reach as it focuses on annual turnover in the UK (£36 million or more) as the criterion for reporting, whereas the French law only applies to French companies and is based on the number of staff employed (5,000 staff in France or 10,000 staff from their combined French and foreign offices). It is therefore estimated that around 150 companies will be affected compared to more than 13,000 in the UK. SCOPE: Despite affecting far fewer companies, France's diligence plan covers a much broader scope in terms of issues, as both human rights and environmental concerns are included. The focus is not only on ensuring decent working conditions and fair wages in supply chains but on sustainability too. CONTENT: The UK's Modern Slavery Act does not set out any specific reporting requirements. There may be six suggested reporting areas...but the only requirements are that a company posts a link to a public statement on the home page of their website and gets sign-off from senior executives or the Board of Directors. Under the French law, it is interesting to note that companies are required to report on their alert mechanisms to identify risks, which should be “developed in consultation with the legitimate trade unions operating within the company”.... PENALTIES: In France, if companies fail to demonstrate that they have established and implemented a plan, they will risk a penalty of up to 10 million euros. Currently, the only risk in the UK is to reputation...