UK mHRDD law will apply to firms above £350m turnover

The UK government announced on 4 November that it intends to introduce a mandatory human rights due diligence (mHRDD) regime for large companies, applying to UK businesses with global turnover above £350m ($470m). Non-UK companies with more than £350m in UK-generated turnover also fall within scope.

The proposed law will require companies to identify, assess and address risks of human rights abuses and labour exploitation in their operations and supply chains. Compliance will be anchored to the UN Guiding Principles and the OECD Guidelines. A new regulator will gain powers to investigate firms suspected of placing forced-labour goods on the British market and to order removal of those goods where due diligence was inadequate and forced labour is found.

The Ethical Trading Initiative (ETI), which has pushed for the law, is urging the government to place workers at the centre of the regime's design. ETI executive director Giles Bolton said: "Today's announcement is a huge step forward for workers in global supply chains, and for the many responsible businesses, trade unions and NGOs that have called for it."

He added: "ETI stands ready to work with government on the detail, so the law puts workers at the heart of due diligence, creates a level playing field for responsible businesses and gives people who are harmed a route to remedy."

What does ETI want changed?

ETI warned that real progress depends on how the regime is detailed in legislation. Its core demand is that workers and unions take meaningful part in due diligence processes and gain genuine access to remedy when harmed.

The organisation's full recommendations to government are:

• Cover the full value chain, in the UK and overseas, including companies' own purchasing practices.
• Bring environmental harms into scope as the regime develops.
• Include public sector procurement, citing its purchasing power to shape supplier behaviour across whole sectors.
• Set proportionate expectations, so the largest businesses use their leverage to support suppliers rather than push requirements onto them.
• Set out a clear timetable, with legislation brought forward in this parliamentary session.
• Give the regulator a role beyond forced-labour goods, with sanctions that drive improvement and a route to remedy.
• Develop guidance through consultation with businesses, trade unions, NGOs and lived-experience experts.

Bolton said ETI will also strongly encourage government to bring both public sector procurement and environmental due diligence into scope, and to publish a clear timetable so businesses can prepare. The regime's scope and timing are the two open questions suppliers and buyers must track.

Who backed the law?

The announcement follows sustained advocacy from ETI's membership of businesses, trade unions and NGOs, alongside the British Retail Consortium and the Corporate Justice Coalition. Last month, 33 organisations joined ETI in signing a letter to the Prime Minister calling for more robust and clearly regulated supply chain practices.

The government said it intends to "work closely" with stakeholders to design and implement the rules, introducing them as soon as parliamentary time allows.

ETI board chair Philip Jennings framed the move as alignment with an international shift. He said: "Around the world, more and more countries are making due diligence a legal duty, and today the UK has taken its place among them."

He added: "A common international standard, built on the UN Guiding Principles and OECD Guidelines, is what makes respect for workers' rights possible at scale. The UK's commitment sends a strong signal to its trading partners, and to workers everywhere who make the goods we rely on."

For apparel and softgoods sourcing teams, the decision now forced is preparation: firms above the threshold must map supply chains against the UN and OECD frameworks before the regulator gains forced-labour enforcement powers.