Bill S-211, also known as the Fighting Against Forced Labour and Child Labour in Supply Chains Act, has been enacted by the Canadian Government, effective January 1, 2024. This legislation mandates certain private-sector entities and government institutions to submit an annual report to the Minister of Public Safety by May 31 of each year. This report will outline the measures taken during the previous financial year to mitigate the risks of forced labor or child labor within their operations or supply chains.
The primary objective of Bill S-211 is to align with Canada's global commitment to combat forced and child labor by imposing reporting obligations. Through this Act, the federal government aims to foster responsible business practices by promoting transparency via public reporting and imposing sanctions for non-compliance.
Is your business ready for Bill S-211?
Any corporation, trust, partnership, or unincorporated organization engaged in activities including producing, selling, or distributing goods in Canada or internationally, importing goods into Canada, or controlling entities involved in these activities, may be impacted by this legislation. Specifically, entities listed on Canadian stock exchanges or having a presence, conducting business, or holding assets in Canada and meeting certain financial criteria will fall under the scope of this Act.
What does your business need to know to comply with Bill S-211?
Reporting Deadline
The annual report detailing actions taken to prevent forced labor or child labor must be submitted by May 31 of each year, with the initial report due on May 31, 2024.
Contents of the Report
The report should encompass the entity's policies, due diligence processes, remediation measures, employee training, and self-assessment of effectiveness in ensuring ethical labor practices within their operations and supply chains.
Approval
The report must be approved by the appropriate governing body and made accessible to the public on the reporting entity's website and an electronic registry on Public Safety Canada's website. Additionally, entities incorporated under relevant Acts of Parliament must provide the report to shareholders alongside annual financial statements.
Questionnaire
Completion of an online questionnaire is also mandatory to comply with the Act's requirements.
Penalties for Non-Compliance
Failure to adhere to the Act may result in fines of up to $250,000. This penalty applies to individuals or entities that fail to comply or knowingly provide false information. Furthermore, Directors, Officers, Agents, or representatives involved in offenses may also face punishment, regardless of whether the entity itself is prosecuted.
Bill S-211 underscores the importance of ethical labor practices and transparency in supply chains. By complying with the reporting requirements outlined in the Act, businesses can demonstrate their commitment to combating forced labor and child labor, thereby fostering a more sustainable and responsible business environment. Contact your Crowe Soberman advisor for customized guidance to ensure all reporting requirements are met.
This article has been prepared for the general information of our clients. Please note that this publication should not be considered a substitute for personalized advice related to your situation.
Mayeer Pearl
Partner,
Audit & Advisory
M. Pearl Professional Corporation