[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 3578 Introduced in Senate (IS)]
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117th CONGRESS
2d Session
S. 3578
To require certain businesses to disclose the use of forced labor in
their direct supply chain, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 3, 2022
Mr. Hawley (for himself and Mrs. Gillibrand) introduced the following
bill; which was read twice and referred to the Committee on Health,
Education, Labor, and Pensions
_______________________________________________________________________
A BILL
To require certain businesses to disclose the use of forced labor in
their direct supply chain, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Slave-Free Business Certification
Act of 2022''.
SEC. 2. REQUIRED REPORTING ON USE OF FORCED LABOR FROM COVERED BUSINESS
ENTITIES.
(a) Definitions.--In this Act:
(1) Covered business entity.--The term ``covered business
entity'' means any issuer, as that term is defined in section
2(a) of the Securities Act of 1933 (15 U.S.C. 77b(a)), that--
(A) has annual, worldwide gross receipts that
exceed $500,000,000; and
(B) is involved in the mining, production, or
manufacture of goods for sale.
(2) Forced labor.--The term ``forced labor'' means any
labor practice or human trafficking activity in violation of
national and international standards, including--
(A) International Labor Organization Convention No.
182;
(B) the Trafficking Victims Protection Act of 2000
(22 U.S.C. 7101 et seq.); and
(C) any act that would violate the criminal
provisions related to slavery and human trafficking
under chapter 77 of title 18, United States Code, if
the act had been committed within the jurisdiction of
the United States.
(3) Gross receipts.--The term ``gross receipts'' has the
meaning given to the term in section 993(f) of the Internal
Revenue Code of 1986.
(4) On-site service.--The term ``on-site service'' means
any service work provided on the site of a covered business
entity, including food service work and catering services.
(5) On-site service provider.--The term ``on-site service
provider'' means any entity that provides workers who perform,
collectively, a total of not less than 30 hours per week of on-
site services for a covered business entity.
(6) Secretary.--The term ``Secretary'' means the Secretary
of Labor.
(7) Supply chain.--The term ``supply chain'' means the end-
to-end process for producing and transporting goods beginning
at the point of origin through a point of distribution to the
destination, inclusive of suppliers, manufacturers, and
vendors.
(b) Audit and Reporting Requirements.--
(1) In general.--Not later than 1 year after the date of
enactment of this Act, and every year thereafter, each covered
business entity shall--
(A) conduct an audit of its supply chain, pursuant
to the requirements of section 3, to investigate the
presence or use of forced labor by the covered business
entity or its suppliers, including by direct suppliers,
secondary suppliers, and on-site service providers of
the covered business entity;
(B) submit a report to the Secretary containing the
information described in paragraph (2) on the results
of such audit and efforts of the covered business
entity to eradicate forced labor from the supply chain
and on-site services of the covered business entity;
and
(C)(i) publish the report described in subparagraph
(B) on the public website of the covered business
entity, and provide a conspicuous and easily understood
link on the homepage of the website that leads to the
report; or
(ii) in the case of a covered business entity that
does not have a public website, provide the report in
written form to any consumer of the covered business
entity not later than 30 days after the consumer
submits a request for the report.
(2) Required report contents.--Each report required under
paragraph (1)(B) shall contain, at a minimum--
(A) a disclosure of the covered business entity's
policies to prevent the use of forced labor by the
covered business entity, its direct suppliers, and its
on-site service providers;
(B) a disclosure of what policies or procedures, if
any, the covered business entity uses--
(i) for the verification of product supply
chains and on-site service provider practices
to evaluate and address risks of forced labor
and whether the verification was conducted by a
third party;
(ii) to require direct suppliers and on-
site service providers to provide written
certification that materials incorporated into
the product supplied or on-site services,
respectively, comply with the laws regarding
forced labor of each country in which the
supplier or on-site service provider is engaged
in business;
(iii) to maintain internal accountability
standards and procedures for employees or
contractors of the covered business entity
failing to meet requirements regarding forced
labor; and
(iv) to provide training on recognizing and
preventing forced labor, particularly with
respect to mitigating risks within the supply
chains of products and on-site services of the
covered business entity, to employees,
including management personnel, of the covered
business entity who have direct responsibility
for supply chain management or on-site
services;
(C) a description of the findings of each audit
required under paragraph (1)(A), including the details
of any instances of found or suspected forced labor;
and
(D) a written certification, signed by the chief
executive officer of the covered business entity,
that--
(i) the covered business entity has
complied with the requirements of this Act and
exercised due diligence in order to eradicate
forced labor from the supply chain and on-site
services of the covered business entity;
(ii) to the best of the chief executive
officer's knowledge, the covered business
entity has found no instances of the use of
forced labor by the covered business entity or
has disclosed every known instance of the use
of forced labor; and
(iii) the chief executive officer and any
other officers submitting the report or
certification understand that section 1001 of
title 18, United States Code (popularly known
as the ``False Statements Act''), applies to
the information contained in the report
submitted to the Secretary.
(c) Report of Violations to Congress.--Each year, the Secretary
shall prepare and submit a report to Congress regarding the covered
business entities that--
(1) have failed to conduct audits required under this Act
for the preceding year or have been adjudicated in violation of
any other provision of this Act; or
(2) have been found to have used forced labor, including
the use of forced labor in their supply chain or by their on-
site service providers.
SEC. 3. AUDIT REQUIREMENTS.
(a) In General.--Each audit conducted under section 2(b)(1)(A)
shall meet the following requirements:
(1) Worker interviews.--The auditor shall--
(A) select a cross-section of workers to interview
that represents the full diversity of the workplace,
and includes, if applicable, men and women, migrant
workers and local workers, workers on different shifts,
workers performing different tasks, and members of
various production teams;
(B) if individuals under the age of 18 are employed
at the facility of the direct supplier or on-site
service provider, interview a representative group
using age-sensitive interview techniques;
(C) conduct interviews--
(i) off-site of the facility and during
non-work hours for the worker;
(ii) individually or in groups (except for
purposes of subparagraph (B)); and
(iii) using methods of communication that
limit, to the greatest practicable extent, any
reliance on devices or services provided to the
worker by the covered business entity,
supplier, or on-site service provider;
(D) use audit tools to ensure that each worker is
asked a comprehensive set of questions;
(E) collect from interviewed workers copies of the
workers' pay stubs, in order to compare the pay stubs
with payment records provided by the direct supplier;
(F) ensure that all worker responses are
confidential and are never shared with management; and
(G) interview a representative of the labor
organization or other worker representative
organization that represents workers at the facility
or, if no such organization is present, attempt to
interview a representative from a local worker advocacy
group.
(2) Management interviews.--The auditor shall--
(A) interview a cross-section of the management of
the supplier, including human resources personnel,
production supervisors, and others; and
(B) use audit tools to ensure that managers are
asked a comprehensive set of questions.
(3) Required information.--The auditor shall--
(A) conduct a thorough review of information
regarding the supplier or on-site service provider to
provide tangible proof of compliance and to corroborate
or find discrepancies in the information gathered
through the worker and management interviews; and
(B) review, at a minimum, the following information
related to the supplier or on-site service provider:
(i) Age verification procedures and
documents.
(ii) A master list of juvenile workers or
information related to juvenile workers.
(iii) Selection and recruitment procedures.
(iv) Contracts with labor brokers, if any.
(v) Worker contracts and employment
agreements.
(vi) Introduction program materials.
(vii) Personnel files.
(viii) Employee communication and training
plans, including certifications provided to
workers including skills training, worker
preparedness, government certification
programs, and systems or policy orientations.
(ix) Collective bargaining agreements,
including collective bargaining representative
certification, descriptions of the role of the
labor organization, and minutes of the labor
organization's meetings.
(x) Contracts with any security agency, and
descriptions of the scope of responsibilities
of the security agency.
(xi) Payroll and time records.
(xii) Production capacity reports.
(xiii) Written human resources policies and
procedures.
(xiv) Occupational health and safety plans
and records including legal permits,
maintenance and monitoring records, injury and
accident reports, investigation procedures,
chemical inventories, personal protective
equipment inventories, training certificates,
and evacuation plans.
(xv) Disciplinary notices.
(xvi) Grievance reports.
(xvii) Performance evaluations.
(xviii) Promotion or merit increase
records.
(xix) Dismissal and suspension records of
workers.
(xx) Records of employees who have
resigned.
(xxi) Worker pay stubs.
(4) Closing meeting with management.--The auditor shall
hold a closing meeting with the management of the covered
business entity to--
(A) report violations and nonconformities found in
the facility; and
(B) determine the steps forward to address and
remediate any problems.
(5) Report preparation.--The auditor shall prepare a full
report of the audit, which shall include--
(A) a disclosure of the direct supplier's or on-
site service provider's--
(i) documented processes and procedures
that relate to eradicating forced labor; and
(ii) documented risk assessment and
prioritization policies as such policies relate
to eradicating forced labor;
(B) a description of the worker interviews, manager
interviews, and documentation review required under
paragraphs (1), (2), and (3);
(C) a description of all violations or suspected
violations by the direct supplier or on-site service
provider of any forced labor laws of the United States
or, if applicable, the laws of another country as
described in section 2(b)(2)(B)(ii); and
(D) for each violation described in subparagraph
(C), a description of any corrective and protective
actions recommended for the direct supplier consisting
of, at a minimum--
(i) the issues relating to the violation
and any root causes of the violation;
(ii) the implementation of a solution; and
(iii) a method to check the effectiveness
of the solution.
(b) Additional Requirements Relating to Audits.--
(1) No retaliation for audit cooperation.--A covered
business entity or supplier, including a direct supplier,
secondary supplier, or on-site service provider, shall not
retaliate against any worker for participating in interviews
under section 3(a)(1) or providing information necessary for
the audit requirements under section 3(a)(3)(B) to the auditor.
(2) Contract requirements.--Each covered business entity
shall include, in any contract with a direct supplier or on-
site service provider, a requirement that--
(A) the supplier or provider shall not retaliate
against any worker for participating in an audit
relating to forced labor; and
(B) worker participation in an audit shall be
protected through the same grievance mechanisms
available to the worker available for any other type of
workplace grievance.
SEC. 4. ENFORCEMENT.
(a) Civil Damages.--The Secretary may assess civil damages in an
amount of not more than $100,000,000 if, after notice and an
opportunity for a hearing, the Secretary determines that a covered
business entity has violated any requirement of section 2(b).
(b) Punitive Damages.--In addition to damages under subsection (a),
the Secretary may assess punitive damages in an amount of not more than
$500,000,000 against an entity that is a covered business entity or
supplier, including a direct supplier, secondary supplier, or on-site
service provider, if, after notice and an opportunity for a hearing,
the Secretary determines the entity--
(1) willfully violated any requirement of section 2(b); or
(2) willfully violated section 3(b)(1).
(c) Declarative or Injunctive Relief.--The Secretary may request
the Attorney General institute a civil action for relief, including a
permanent or temporary injunction, restraining order, or any other
appropriate order, in the district court of the United States for any
district in which the covered business entity conducts business,
whenever the Secretary believes that a violation of section 2(b)
constitutes a hazard to workers.
SEC. 5. REGULATIONS.
Not later than 180 days after the date of enactment of this Act,
the Secretary shall promulgate rules to carry out this Act.
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