MODERN SLAVERY COMPLIANCE IN ENERGY PROJECTS

1. Introduction

Modern slavery compliance in energy projects concerns the legal and governance measures used to prevent forced labour, human trafficking, servitude, debt bondage, child exploitation, and other severe labour abuses throughout project operations and supply chains. Large energy developments—including renewable-energy projects, mining, electricity networks, battery storage, oil and gas operations, and major infrastructure—often depend on complex international supply chains.

Modern slavery risks can arise during extraction of raw materials, manufacturing of solar panels and batteries, construction, transportation, subcontracting, maintenance, and decommissioning. Compliance therefore extends beyond direct employees and increasingly requires businesses to examine contractors, suppliers, labour agencies, and overseas operations.

2. Legal Framework

In the United Kingdom, an important statutory framework is the Modern Slavery Act 2015. Section 54 establishes transparency requirements for qualifying commercial organisations carrying on business in the UK. Businesses within its scope must publish an annual slavery and human-trafficking statement explaining the steps taken to address slavery and trafficking within their business and supply chains.

For energy companies, modern-slavery governance may therefore involve supplier screening, contractual labour standards, risk assessments, audits, grievance mechanisms, worker interviews, remediation procedures, and board-level oversight.

Compliance also interacts with general corporate law, tort law, health and safety requirements, procurement standards, human-rights principles, and international standards such as the UN Guiding Principles on Business and Human Rights.

3. Supply-Chain Due Diligence

Energy companies frequently operate through multi-tier supply chains. A renewable-energy developer, for example, may purchase equipment from manufacturers that themselves obtain minerals, metals, components, and labour from numerous jurisdictions.

Effective due diligence requires companies to identify where serious labour risks exist rather than merely obtaining contractual assurances from immediate suppliers. Relevant measures include mapping supply chains, examining recruitment practices, identifying excessive recruitment fees, checking worker freedom of movement, investigating subcontractors, and establishing confidential reporting systems.

A particularly important principle is that compliance should be risk-based and continuous. A supplier that initially satisfies contractual standards may later introduce subcontractors or sourcing practices that create new risks.

4. Contractual and Corporate Governance

Energy-project contracts can incorporate modern-slavery obligations through representations, warranties, audit rights, disclosure requirements, corrective-action obligations, termination clauses, and supplier codes of conduct.

However, contractual clauses alone may be insufficient. Companies should establish internal responsibility for monitoring compliance and ensure that credible allegations trigger investigation and remediation. Modern slavery governance therefore combines contractual control with corporate accountability.

Financiers and public procurement authorities may also impose environmental, social and governance requirements before providing financing or awarding major energy contracts.

5. Case Law

Case: Begum v Maran (UK) Ltd [2021] EWCA Civ 326

Facts: The claimant's husband worked at a shipbreaking yard in Chattogram, Bangladesh. He died after falling while dismantling an oil tanker. The vessel had been sold for demolition through arrangements involving Maran (UK) Ltd. The claimant alleged that Maran exercised control over the sale and knew that the vessel would ultimately be dismantled in dangerously unsafe working conditions.

Legal Issue: Whether it was arguable that the UK company owed the deceased worker a duty of care, notwithstanding the involvement of independent third parties between the company and the Bangladeshi shipbreaking operation.

Judgment: The Court of Appeal held that the negligence claim should not be struck out at this preliminary stage. On the assumed facts, it was arguable that the defendant had created a dangerous situation by controlling the vessel's disposal while knowing that workers could consequently be exposed to serious risks. The decision did not finally establish liability; it allowed the relevant duty-of-care arguments to proceed.

Legal Principle/Ratio Decidendi: A company may, in appropriate circumstances, face an arguable duty-of-care claim where its own decisions create or materially contribute to a foreseeable danger, even though immediate harm is inflicted through the conduct of another party. Foreseeability alone, however, is insufficient; questions including proximity and control remain important.

Significance: Although Begum was not itself a prosecution under modern-slavery legislation, it is highly relevant to responsible supply-chain governance. It demonstrates how corporate decisions concerning contractors, disposal arrangements, and overseas operations can potentially generate legal exposure beyond the company's immediate workforce.

6. Application to Energy Projects

The principles are particularly important for energy businesses sourcing critical minerals, photovoltaic components, batteries, construction materials, and outsourced labour. Companies should assess both their direct operations and circumstances in which commercial decisions may expose workers further down the supply chain to exploitation.

Modern-slavery compliance should therefore be integrated into project procurement, ESG governance, contractor management, financing, construction supervision, and decommissioning strategies.

7. Conclusion

Modern slavery compliance has become an important dimension of responsible energy-project governance. The legal framework encourages businesses to identify labour risks, increase supply-chain transparency, supervise contractors, and implement meaningful due diligence. Begum v Maran (UK) Ltd further demonstrates the potential importance of knowledge, control, foreseeability, and creation of risk when corporate decisions contribute to dangerous overseas working conditions. Effective compliance therefore requires more than formal policies: it demands continuing oversight of how energy projects affect workers throughout their operational and supply-chain networks.