Employee outsourcing hides forced labour in the workforce, new research shows

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  • New research suggests a failure to monitor outsourced recruitment is resulting in companies inadvertently employing victims of forced labour
  • Layers of outsourcing, subcontracting and informal hiring of temporary staff are to blame
  • Report is one of the first research studies to examine forced labour in companies based in the UK, focusing on the UK’s construction and food industries

Failure to monitor outsourced recruitment is resulting in companies inadvertently employing victims of forced labour, according to new research from the Universities of Sheffield and Bath.

Interviews with experts in business, NGOs, trade unions, law firms and the police showed that while companies can increasingly trace where their products come from, many are in the dark about the backgrounds of their staff.

The research, by the University of Sheffield and the University of Bath’s School of Management, suggests that layers of outsourcing, subcontracting and informal hiring of temporary staff are to blame. This, say the researchers, enables victims of forced labour to be hidden within the workforce of companies and organisations – even those with the best intentions.

Statistics recently released by the National Crime Agency showed that the number of people reported as potential victims of forced labour and human trafficking in the UK has more than doubled in the past three years, with 3,805 people referred for help in 2016.

The researchers concluded that the key issue in tackling forced labour is understanding the labour supply chain – the often unregulated networks through which contingent and sometimes forced or trafficked workers are recruited, transported, and supplied to business by third party agents.

Study co-author Dr Genevieve LeBaron, from the University of Sheffield’s Department of Politics, said: “Leading UK companies are starting to belatedly wake up to the fact that their existing systems for detecting worker abuse simply are not fit for purpose for uncovering forced labour. But, as new initiatives emerge, the critical factor determining their success will be whether they meaningfully address the labour supply chains that feed their business.

It is these chains that make forced labour seemingly invisible even when the workers subjected to them are right in front of us in the farms, factories and construction sites that surround our communities.

The study showed that most incidences of forced labour were several steps removed from the core workforce at the producer company. Within the agricultural sector these employees could potentially only be on site for a matter of days or weeks, making it difficult for producers to detect abuse.

Companies thought they were able to shield themselves from forced labour because of the investment they had made in responsible product sourcing but in reality their focus on tracing the product supply chain does not equip them to easily trace where workers have come from, or the types of exploitation they have been exposed to.

One CEO of a UK hotel chain explained to researchers: “We have pretty much solved traceability of the food served in our restaurants. I can tell you the farm where the steak on your plate came from, probably even the name of the cow. But we have no idea where the workers came from that work in our kitchens.”

The workers in these kitchens may well have been supplied by unscrupulous agents who subject workers to highly exploitative employment practices, such as withholding their passports, forcing them to work for little or no pay, threatening them or their families, or tricking them into racking up huge debts through deductions for accommodation, food, transport and other “services”. Some will even have paid to get the job in the first place.

The researchers say government needs to instigate better coordination between labour market enforcement and immigration law. Currently, immigration rules create vulnerabilities among migrants that can be exploited by traffickers in ways that are difficult to police with existing labour market enforcement practices.

For companies, researchers say the study highlights that the current models of social auditing are unfit for purpose in detecting and preventing forced labour.

Lead author, Professor Andrew Crane, Director of the University of Bath’s Centre for Business, Organisations and Society, added: “Companies have little hope of detecting modern slavery practices unless they adopt a new approach that focuses specifically on their labour supply chains – they need to be able to trace the origin of their employees in the same way as most now can for their products.

“Twenty years ago most high street retailers did not have a clue where the products they sold actually came from. Since then, there has been a revolution in responsible business practices and companies have invested millions of pounds to trace the source of their products and tackle the myriad sustainability issues they found there. To prevent the misery of modern slavery from blighting our workforces companies must apply that same focus to their staff.”

The research, which received funding from the Joseph Rowntree Foundation, is published in Regulation & Governance, and is one of the first research studies to examine forced labour in companies based in the UK, focusing on the UK’s construction and food industries.

Governance gaps in eradicating forced labour: From global to domestic supply chains was undertaken with Monash University Australia and Simon Fraser University Canada. DOI: 10.1111/rego.12162

Additional information

The University of Sheffield

With almost 27,000 of the brightest students from over 140 countries, learning alongside over 1,200 of the best academics from across the globe, the University of Sheffield is one of the world’s leading universities.

A member of the UK’s prestigious Russell Group of leading research-led institutions, Sheffield offers world-class teaching and research excellence across a wide range of disciplines.

Unified by the power of discovery and understanding, staff and students at the university are committed to finding new ways to transform the world we live in.

Sheffield is the only university to feature in The Sunday Times 100 Best Not-For-Profit Organisations to Work For 2017 and was voted number one university in the UK for Student Satisfaction by Times Higher Education in 2014. In the last decade it has won four Queen’s Anniversary Prizes in recognition of the outstanding contribution to the United Kingdom’s intellectual, economic, cultural and social life.

Sheffield has six Nobel Prize winners among former staff and students and its alumni go on to hold positions of great responsibility and influence all over the world, making significant contributions in their chosen fields.

Global research partners and clients include Boeing, Rolls-Royce, Unilever, AstraZeneca, Glaxo SmithKline, Siemens and Airbus, as well as many UK and overseas government agencies and charitable foundations.

The University of Bath

The University of Bath is one of the UK's leading universities both in terms of research and our reputation for excellence in teaching, learning and graduate prospects.

The University is rated Gold in the Teaching Excellence Framework (TEF), the Government’s assessment of teaching quality in universities, meaning its teaching is of the highest quality in the UK.

In the Research Excellence Framework (REF) 2014 research assessment 87 per cent of our research was defined as ‘world-leading’ or ‘internationally excellent’. From developing fuel efficient cars of the future, to identifying infectious diseases more quickly, or working to improve the lives of female farmers in West Africa, research from Bath is making a difference around the world. Find out more: http://www.bath.ac.uk/research/

Well established as a nurturing environment for enterprising minds, Bath is ranked highly in all national league tables. We are ranked 5th in the UK by The Guardian University Guide 2018 and 6th for graduate employment. According to the Times Higher Education Student Experience Survey 2017, we are in the top 5 universities students would recommend to a friend.

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