I move: "That the Bill be now read a Second Time."
I am pleased to speak on the Labour Exploitation and Trafficking (Audit of Supply Chains) Bill 2021 in the names of my colleagues Deputies Ó Ríordáin and Sherlock. I am sharing time with Deputy Sherlock.
This is Ireland’s first legislation on regulating corporate activity in respect of labour exploitation and trafficking. As an internationalist party, and as part of the wider international labour movement, it is the Labour Party’s historic and moral obligation to ensure, always, that the power imbalance between capital, with all its attendant abuses and indignities, and labour is rebalanced. That inequality is at its most stark when it comes to the predations of the global supply chain. As one of the most open and globalised economies in the world, heavily reliant on global supply chains in a complex and interconnected world, Ireland has a particular responsibility to introduce a legal framework on mandatory due diligence and business accountability as defined by the UN, the OECD and other important multilateral agencies to prevent negative impacts on human rights, labour rights and the environment.
The purpose of this Bill is to provide for transparent reporting by firms about the risk of labour exploitation and human trafficking in their supply chains. The Bill would require businesses to report annually on what measures they have taken to ensure that production of the goods or services they sell does not involve such exploitative practices. This area is already the subject of voluntary codes. Voluntary codes, to nobody's surprise, are simply not working. So far voluntary implementation by businesses has been neither widespread nor effective. Legislation would help to ensure greater compliance and it would put in place a level playing field that rewards good businesses and those which adhere to the rules.
The French duty of vigilance law of 2017 was the first time an EU member state established a legal duty on companies to act to prevent human rights abuses, domestically and abroad, and to publicly account for the steps taken. Since then, Germany and Norway introduced similar laws in 2021 and parliamentary processes are under way in Austria, Finland, Belgium, the Netherlands and Luxembourg.
There is no overarching legal or regulatory regime to make mandatory due diligence and reporting on human rights and labour rights for businesses in Ireland. There should be no Irish exceptionalism. This needs to change and I am interested to receive from the Minister of State in his response to our opening statements an update on progress in regard to the proposed corporate sustainability due diligence directive.
A number of years ago Ireland committed to implementing the UN Guiding Principles on Business and Human Rights, through the National Plan on Business and Human Rights 2017-2020. However, the national plan proposes a voluntary regime, whereby the role of the State is to encourage and support rather than to ensure compliance. The programme for Government made a commitment to "ensure that the Action Plan is further developed to review whether there is a need for greater emphasis on mandatory due diligence". There is such a need and we need to go beyond voluntary codes and legislate.
According to a June 2021 Ipsos MRBI opinion poll conducted for the Irish Coalition for Business and Human Rights, 81% of Irish people would want an Irish company that is acting unethically in a low-income country to be subject to legally binding regulations in Ireland. Only 11% believe Irish companies operating unethically in low-income countries should be able to self-regulate and apply their own standards. Irish citizens are behind reform in this area. We also know consumer purchases are increasingly informed by principle as well as price.
The Bill applies to labour exploitation and trafficking, which is defined as any activity that constitutes an offence under the Child Trafficking and Pornography Acts 1998 to 2004 or the Criminal Law (Human Trafficking) Act 2008, and making use of work done by a person under the age of 18 where that work is liable to harm the health, safety or morals of the child. Work liable to harm the health, safety or morals of a child would include, for example, work that exposes the child to physical, psychological or sexual abuse, work in an unhealthy environment or for long hours or during the night, or work where the child is unreasonably confined to the premises of the employer.
The International Labour Organization says that more than 25 million people across the world are in forced labour. To our shame, this includes millions of children who are still making goods and providing services across the supply chain. They are used by Irish companies that are household names. These are companies based here, making products we too easily take for granted. The Bill applies to any undertaking that is engaged for gain in the production, supply or distribution of goods or the provision of services which, in the course of business, imports goods into the State or receives services from outside the State, the cost of which exceeds 5% of the undertaking's input costs.
Section 3 requires the Minister for Enterprise, Trade and Employment to make regulations that would require undertakings with a turnover greater than a prescribed amount to prepare and publish annually a labour exploitation and trafficking statement. This is a statement of the steps the undertaking has taken in the previous year to ensure labour exploitation and trafficking is not taking place in any of its supply chains or in any part of its own business, or else a statement that the undertaking has taken no such steps. This statement may include information about the undertaking's structure, its business and its supply chains; its policies on labour exploitation and trafficking; its due diligence processes on labour exploitation and trafficking in its business and supply chains; the parts of its business and supply chains where there is a risk of labour exploitation and trafficking taking place, and the steps it has taken to assess and manage this risk; its effectiveness in ensuring labour exploitation and trafficking is not taking place in its business or supply chains, measured against such performance indicators as it considers appropriate; and the training about labour exploitation and trafficking available to its staff.
The Bill enables the Minister to issue guidelines on the duties imposed on undertakings by this measure and requires the Minister to publish any such guidelines on the Minister's website. The guidelines may include further provision about the kind of information which may be included in a labour exploitation and trafficking statement. An undertaking that contravenes regulations under the legislation will be guilty of a summary offence and liable to a fine. This is a measure that is not available in some of the legislative provisions available elsewhere. Section 6 provides that the Minister must cause a review of the legislation to be carried out before its fifth anniversary and must cause the review to be laid before both Houses of the Oireachtas.
The time is right for legislation of this nature. As the evidence in the Ipsos MRBI poll pointed out, there is public demand for this type of legislation and for a move from a situation where we have voluntary codes that have not been effective to a situation where legal mandates will now be imposed on business accountability and due diligence in respect of child labour, labour more generally and human rights.
I note the Government is not opposing the Bill. I look forward to an update from the Minister of State on progress on the directive to which I referred earlier.
