Five on Friday – Five Recent Developments that We’ve Been Watching Closely

It’s Friday and time for another overview of developments in the field of business and human rights that we’ve been monitoring.

This week’s post includes: a new lawsuit aimed at combating human trafficking in corporate supply chains; the release of the 2016 Trafficking in Persons Report by the U.S. State Department; and a change in the Reporting Requirements on Responsible Investment in Burma.

  • On July 1, the U.S. State Department’s Office to Monitor and Combat Trafficking in Persons released the 2016 Trafficking in Persons report, its annual review of the anti-human trafficking efforts of countries around the globe. The report ranks 190 countries on the effectiveness of their efforts to address human trafficking. Countries that received the worst, or Tier 3, rankings include Burma, Haiti, Sudan, and Suriname. As companies are increasingly being scrutinized with regard to their efforts to address human trafficking in their supply chains, the Trafficking in Persons report has increasing relevance for the private sector.
  • On June 15, a lawsuit was filed in federal court in California by Cambodian plaintiffs who allege that they were victims of human trafficking as a result of their recruitment to and subsequent forced labor at factories in Thailand producing seafood for export to the United States. The plaintiffs have filed suit pursuant to the Trafficking Victims Protections Act, which allows victims of human trafficking to bring civil claims against persons or entities that have knowingly benefited from participation in a venture that was engaged in trafficking or forced labor. Defendants in the case include both Thai-based companies and U.S.-based companies that import and distribute seafood from Thailand. The case highlights the potential litigation risk for companies that know, or should know, that they are benefiting from acts of human trafficking in their supply chains.
  • At the end of June, the U.S. Government formally approved an extension of the Reporting Requirements on Responsible Investment in Burma, which were originally released in 2012 as part of the government’s easing of sanctions and authorization of new investment in the country. The reporting requirements state that companies should report on policies and procedures with regard to human rights, environmental stewardship, land acquisitions, arrangements with security providers, and aggregate annual payments exceeding $10,000 to Burmese government entities. Notably, with the extension, the investment threshold that subjects companies to the reporting requirements has been increased from $500,000 to $5,000,000 in aggregate new investment.
  • On June 29, the U.N. Human Rights Council passed a resolution on business and human rights, with a specific focus on improving accountability and improving access to remedy. The resolution called on companies to “to meet their responsibility to respect human rights in accordance with the Guiding Principles” including by “actively contributing to initiatives aimed at fostering a culture of respect for the rule of law, participating in good faith in domestic judicial processes, and by establishing effective operational-level mechanisms to enable the early resolution of grievances.” The resolution also called on companies to make public disclosures regarding their “human rights policies and procedures.”
  • On June 21, the OECD released a report analyzing the functioning and performance of the National Contact Points, which have served for 15 years as national-level mechanisms intended to promote the implementation of the OECD Guidelines for Multinational Enterprises, in part by providing a non-judicial forum for the resolution of grievances, or specific instances. The report notes that, globally, the National Contact Points have handled over 360 specific instances since 2000, addressing the impacts of business activity in over 100 countries and territories. The U.S. National Contact Point recently released final reports on two specific instances, involving stakeholder disputes with both Starwood Hotels and PepsiCo.