Built Environment

Can the Construction Industry Build Itself a Slavery-Free Future?

30 July 2015

By Neill Wilkins, Head of Migrant Workers Programme, IHRB

International construction firms are increasingly being forced to face up to the consequences of business practices which fail to prevent forced labour and trafficking.

In recent years the issues of forced labour and human trafficking have risen higher on the political agenda than ever before. As awareness has grown, the world has come to learn such exploitation is far more common than was previously known and touches many aspects of our lives.

Far from being an aberration, and a manifestation of criminal activity confined to the shadowy parts of the economy, in reality abusive labour practices are a fairly common feature of many areas of business activity and modern supply chains.

If in the past, customer-facing brands came under the most pressure from customers and activists, of late many other sectors have faced similar scrutiny and been forced to examine their operating procedures and business models.

An example is the construction sector. It has become one of the main focal points for the media, particularly with its integral involvement in infrastructure development associated with mega-sporting events around the world. These occasions by their nature often involve major construction projects and their high profile means a media spotlight shines a light into those darker areas of business practices, which are not usually noticed.

International construction firms are keen to take advantage of prestigious, and potentially lucrative contracts associated with these events. But they are increasingly being forced to face up to the consequences of business practices which at best fail to prevent forced labour and trafficking, turn a blind eye, or at worst even tacitly encourage it. Mega-sporting events reveal to the world how construction companies and the sector operate. In many cases they are found wanting.

The initial, almost knee-jerk response from companies in any sector, when faced with allegations of human rights abuse or exploitation, is denial - that there is no problem.

“It is just a few bad apples or isolated incidents,” many argue. But the reality is that business models have largely evolved in ways that make such practices wider systemic challenges. Failure to properly understand, detect, prevent and remedy exploitation over many years has led to these practices becoming embedded and integral to the way significant portions of the construction industry operates.

Concerned about their reputation, another response from companies is to try to distance themselves from the situation by claiming that severe labour abuses are primarily the fault of sub-contactors or other outsourced operations. While this may offer some legal protection to companies, there is no guarantee that it would protect any major construction contractor or its client from reputational risk. Think of a supermarket or apparel brand when it faces criticism over the activities of its suppliers. The credibility of any brand rests on its reputation and trust – who would trust a company unable to properly govern its own supply chain?

Construction companies also face increased scrutiny from policymakers (who are themselves under pressure to do more to prevent exploitation) and legislation such as the UK Modern Slavery Act, which aims to improve current practice. Under the transparency requirements of the Act companies with a turnover above £36 million will have to report on the steps they are taking to prevent the use of forced labour and trafficking in their supply chains. It would be a bold company to report they were taking no actions whatsoever.

Government also has a role to play. The UN Guiding Principles on Business and Human Rights affirm the duty of states to protect against human rights abuses involving private actors. In many countries there is certainly no absence of legislation, but political will or properly resourced processes for enforcement are often lacking. Appropriate enforcement  would not only protect workers but also law-abiding businesses, which respect their workforces and operate by the rules. Sustainable business needs a level playing field to thrive and it is by ensuring those conditions that successful economies develop. Governments also have leverage in the award of public contracts. Large infrastructure projects offer the chance to set a high bar for the industry with the hope that ensuring best practice will ultimately feed into other projects.

So what are the actions construction companies should take? It begins with a commitment expressed in a human rights policy statement understood and approved at the most senior level of the company. This should be accompanied by a number of specific steps such as developing a far more sophisticated understanding of where their human rights risks lie. It also requires proper due diligence and effective impact assessments. This will be aided by engagement with human rights specialists, consultancies, trade unions and civil society organisations. Companies also need programmes that move beyond reactive or stopgap actions. They need to be more than a responsibility of some newly formed CSR department or a quickly seconded health and safety officer but instead are part of wholesale changes integrated into the very fabric of the company and the way it operates. Performance indicators for departments and functions company-wide should reflect this, as should individual performance reviews and assessments.

As with any enterprise using large numbers of unskilled workers, forced labour and trafficking are key concerns. The construction site may be where exploited workers end up, but it is seldom the place where exploitation starts. Any worker paying a recruitment fee, having their passport retained or being beholden in some other way to a labour broker or other intermediary is either being exploited, or is effectively bonded, and bondage is an indicator of forced labour, regardless of subsequent conditions at the worksite. Understanding supply chains for labour is the key to unlocking this issue.

The construction industry is now beginning to realise that solutions to many of these challenges are in their own hands. A recent roundtable on the UK Modern Slavery Act organised by IHRB and engineering / construction firm CH2M included many of the largest international construction companies who were keen to learn and share experiences. Collaborations within the industry and through industry trade associations can and should drive this agenda. Collaboration will also increase the industry’s leverage with governments, regulators and suppliers.

The Chartered Institute of Building’s (CIOB) recent report Modern Slavery - The Dark Side of Construction is a further welcome step forward. It contains a range of opinions from both inside and outside the industry along with a number of case studies. As noted in the foreword to the report by CIOB Chief Executive Chris Blythe:

"Our business model is predicated on passing risk down the supply chain. But these risks are never passed down in reality, they remain ethically and morally the responsibility of the people at the top. So it’s time to change the business model and to start facing up to our responsibilities.”

Forced labour and human trafficking are widespread. To deliver change requires bold and inspiring leadership backed by strong commitments at every level of company operations. It is time for the construction industry to build itself a slavery free future.

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