Canadian Lawyer

September 2021

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36 www.canadianlawyermag.com LEGAL REPORT LITIGATION on Business and Human Rights, issued in 2011. The Modern Slavery Act 2015 is an Act of the Parliament of the United Kingdom designed to combat modern slavery in the UK. It consolidates previous offences relating to trafficking and slavery. And Germany's new Supply Chain Due Diligence Act, coming into effect in January 2023, requires that large companies ensure their supply chain is observing social and environmental standards. Managing the risk Terry says that avoiding litigation involves having appropriate internal policies in place, doing diligence around transactions, and being thoughtful in implementing these policies. "Sometimes a company can get itself into trouble if it's almost too ambitious," he says; "it's important to follow up if you're setting a particular diversity target" or have made public statements ensuring there are no human rights violations in supply chains, and with the mechanisms to validate that. "It's a view that well-run companies will get right away," he says. Terry often gets questions from clients who may be doing business in Myanmar, for example, or the Xinjiang territory of China, which has come under attack for its treatment of the Uyghur people, including forced labour. "Most companies I know are getting themselves better organized, and coming up with appropriate policies," he says, partic- ularly if they are operating in the inter- national market, "either with suppliers from abroad or … when you're engaged in Canadian miner Hudbay Minerals had a claim brought against it in Canada for sexual assault connected to its operations in Guatemala. In 2011, 11 Guatemalan women filed a lawsuit against Hudbay and its subsidiary HMI Nickel Inc., alleging the companies were complicit in the gang rapes committed by their private security forces on the Fenix nickel mining project in El Estor, Guatemala. That case is ongoing. According to Terry, complaints have also been brought against pension funds as investors, including Scandinavian and Dutch funds. The Rana Plaza factor y in Dhaka, Bangladesh, collapsed in April 2013 and 1,130 people — primarily women — died, and another 2,520 people were seriously injured. Although the claim brought against Loblaw and Joe Fresh after that incident was unsuccessful, a focus has developed since then on supply chains and new obli- gations in various jurisdictions, says Terry. This new focus aims to ensure that investors and companies operating internationally do their due diligence and do not engage suppliers violating human rights. Countering modern-day slavery In Canada, Bill S-216, An Act to enact the Modern Slavery Act and amend the Customs Tariff, is before the Senate. Its enactment "would follow trends we see around the world," says Reichelt, including in Germany, the United Kingdom, Italy and France, by updating legislation against modern slavery. The new law would require annual corpo- rate reporting with an aim to reduce the risk of forced or child labour. This bill is the third attempt to pass this legislation in Canada, she notes. In 2018 and 2020, bills were tabled but not enacted. "The current form doesn't introduce mandatory human rights due diligence, which we see in some of the cases in the European countries, but it does intend to implement domestic law [to support] Canada's international commit- ments to fight against modern slavery." Much modern slavery legislation is modelled after the UN Guiding Principles MODERN SLAVERY ACT LEGISLATION REVIVED October 2020: Bill S-216, An Act to enact the Modern Slavery Act and to amend the Customs Tariff, receives first reading in Canadian Parliament. The legislation would follow European countries in enacting laws to reduce the risk of forced or child labour.

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