Canada’s Modern Slavery Act: What You Need to Know

With the May 31st deadline fast approaching for companies to comply with Canada’s Modern Slavery Act, it’s fair to say most companies are laser focused on getting that first report ready for submission to the government.  Are you ready?

What is Canada’s Modern Slavery Act?

The Fighting Against Forced Labour and Child Labour in Supply Chains Act (Bill S-211), commonly referred to as Canada’s Modern Slavery Act, is a significant step in the fight against human trafficking and modern slavery within Canadian borders. The bill, passed in May of 2023 and in effect on January 1, 2024, mandates that certain organizations provide reports detailing the steps they have taken to address and prevent modern slavery in their supply chains and operations.  

Canada’s legislation is in line with the growing global trend towards corporate responsibility and transparency, particularly when compared to other modern slavery laws throughout the world, such as the UK Modern Slavery Act and the California Transparency in Supply Chains Act. Bill S-211, like its counterparts, emphasizes supply chain due diligence and reporting standards. While every law is different, they all serve to highlight how crucial corporate responsibility is to stopping violations of human rights and advancing moral business conduct globally. 

Does Canada’s Modern Slavery Act apply to my company? 

The Act applies to any business, including a corporation, trust, partnership, or unincorporated entity that:  

Is listed on a Canadian stock exchange, or 

Has a place of business in Canada, conducts business within Canada, or has or controls assets in Canada, and meets at least two of the following conditions in one of its two most recent financial years: 

  1. Has at least $20 million in assets, 
  1. Has generated more than $40 million in revenue, and  
  1. Has an average of at least 250 employees. 

The act also applies to government institutions and crown corporations, even if they don’t meet the above criteria.  

It’s important to note that these criteria are exclusive, so if a company doesn’t meet the size thresholds but is publicly listed on any Canadian stock exchange, it is still required to submit a report. Likewise, if a company isn’t publicly listed on a stock exchange, but does meet at least two of the size thresholds, then it also needs to report.  

What’s required of businesses under the Canadian Modern Slavery Act? 

To comply with the act, companies need to produce an annual report on the actions within their business and their supply chain to prevent and eliminate forced labour and child labour risk.  

According to Public Safety Canada, companies must submit a report each year that addresses: 

  • The steps the entity has taken during its previous financial year to prevent and reduce the risk that forced labour or child labour is used at any step of the production of goods in Canada or elsewhere by the entity or of goods imported into Canada by the entity 
  • Its structure, activities and supply chains 
  • Its policies and due diligence processes in relation to forced labour and child labour 
  • The parts of its business and supply chains that carry a risk of forced labour or child labour being used and the steps it has taken to assess and manage that risk 
  • Any measures taken to remediate any forced labour or child labour 
  • Any measures taken to remediate the loss of income to the most vulnerable families that results from any measure taken to eliminate the use of forced labour or child labour in its activities and supply chains 
  • The training provided to employees on forced labour and child labour 
  • How the entity assesses its effectiveness in ensuring that forced labour and child labour are not being used in its business and supply chains 

In addressing the requirements of Canada’s Modern Slavery Act, it’s crucial to recognize that compliance goes beyond paperwork. This legislation isn’t merely a desktop exercise; it’s a continuous commitment to combatting child and forced labour throughout the year.  

Several departments within your company, including supply chain, compliance, HR, legal, leadership, and the general workforce, will need to be involved to ensure compliance with this Act. At ensogo, we recommend that companies begin by comprehensively understanding the Act’s scope and its applicability to their operations. This fundamental knowledge makes it easier to coordinate efforts with the Act’s goals, allowing for the creation of policies, goal setting, and performance evaluation using KPIs. 

Tools to comply with Canada’s Modern Slavery Act 

When compiling your first report, navigating sustainability or ESG reporting can feel intimidating, especially for businesses who are new to the industry or are facing new regulations like Bill S-211. That’s why it’s helpful to understand the tools and resources available to help your company comply with the laws in this domain. 

Companies can create, manage, track, and report on sustainability and compliance initiatives with the help of the ensogo platform. By combining the strength of generative AI with intuitive tools for accountability and cooperation, ensogo makes sure that your company can easily keep on top of sustainability rules and goals. 

Those whose businesses fall under the jurisdiction of Bill S-211 can leverage ensogo to: 

  • Set clear and measurable goals related to Bill S-211, for example a company may set up an employee education and training program, which can then be monitored, tracked, and reported on through the ensogo platform.  
  • Create policies leveraging the generative AI within our Corporate Policy Builder.  
  • Create accountability; the ensogo platform allows you to designate individuals or teams as responsible for each goal and associated KPIs, ensure clear lines of accountability and a documented history of the steps taken to achieve that goal.  
  • Collaborate with suppliers; through our KPI form tracker ensogo enables you to engage and collaborate with your suppliers, contractors, and partners and ensure you’re communicating the right information and collecting the right data from your suppliers.  
  • Initiate joint programs in areas of shared responsibility; the platform allows you to plan, track, and measure the joint impact of your efforts.  

Get in touch with ensogo right now to learn how we can assist you in your effort to eradicate child and forced labour through your supply chain. 

About the Author

Jon Elkin is an accomplished software executive with a wealth of expertise in ESG ratings, supply chain management, and AI-driven solutions. As Vice President of Operations at ensogo, Jon leverages his extensive experience in product development, marketing, sales, and client services to deliver exceptional service to ensogo’s clients. Previously serving as Vice President at OMX, he led the company through its acquisition by Morningstar Sustainalytics and successfully rebranded OMX as the Sustainalytics ESG Assessment Platform. Jon is deeply passionate about delivering top-tier ESG solutions to the market and supporting companies in their sustainability endeavors.