The law of human trafficking is a relatively new legal framework that has come a long way but needs the thinking and work of dedicated trial lawyers in order to end the crime. We have seen, over the past 40 years, that the efforts of trial lawyers in partnership with government and activists have brought enormous advances in the quality of life – the use of seatbelts – and diminishing distracted driving, smoking, DDT, Asbestos, and unsafe products. So far, activists, poorly funded NGO’s, and outgunned law enforcement have worked on law, policy and awareness, but now it is time to end the crime.
In the 1990’s, untested laws were enacted in state legislatures across the United States. These laws have been refined every year as best practices become clear and appellate opinions are issued. It is an emerging body of law, and the definitions of the crime and tort vary widely from state to state and from nation to nation. It is one of the very few, if not the only area of law, where new corporate compliance disclosure standards, torts and enhanced damages are being signed into law – even by the most tort reform friendly states.
Scope of the Issue
Human trafficking is modern day slavery — a multi-billion dollar criminal industry that affects 21 million people around the world. From the girl forced into prostitution at the average age of fourteen, to the man working in a foreign land, stripped of his passport and held against his will by debt bondage. No matter where the crime occurs, trafficking victims share one essential experience: the loss of freedom. President Obama has called the fight against human trafficking one of the great human-rights causes of our time. Human trafficking is estimated to impact between 600,000 and 800,000 people worldwide; between 14,500 and 17,500 people are trafficked into the United States annually. The International Labour Organization reports that three out of every 1,000 people worldwide are in forced labor, including 1.5 million in North America.
Victims are trafficked across both national and international borders, infiltrating nearly every part of the world, according to one World Health Organization report. But most human trafficking, however, occurs within national borders. In Denver for example, virtually all minors who are rescued from trafficking are Denver middle school girls.
Refugee migration, destruction of economies, lack of education and opportunity, violence and war are the fundamental causes for trafficking. Spikes in trafficking occurred with the fall of the Soviet Union and the loss of jobs. Where there is no economy to allow people to rise above the poverty line, human beings are reduced to selling themselves and their children to survive. Gang life in the United States promotes sex trafficking of girls in at risk neighborhoods. With nearly 5 million Syrians running from war – with no home and no ability to work – human trafficking may reach an all time high.
How is this Defined?
The most widely accepted definition of human trafficking comes from the Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially Women and Children, otherwise known as the Palermo Protocols. Adopted by the UN General Assembly in 2000 and accepted by over 150 countries, the Palermo Protocols defines human trafficking as:
The recruitment, transportation, transfer, harboring or receipt of persons, by means of the threat or use of force or other forms of coercion, of abduction, of fraud, of deception, of the abuse of power or of a position of vulnerability or of the giving or receiving of payments or benefits to achieve the consent of a person having control over another person, for the purpose of exploitation.
Where does this Occur?
Exploitation generally occurs as forced labor, sexual exploitation, organ and tissue harvesting, people smuggling, and child soldiering. Agriculture, Manufacturing, Domestic Servitude, Prostitution, Elder Care, Country Clubs and Hotels, Restaurants and Janitorial Services are industries where trafficking occurs most.
Victims of this widespread form of trafficking come primarily from developing countries. They are recruited and trafficked using deception and coercion and find themselves held in conditions of slavery in a variety of jobs. Men, women and children are engaged in agricultural work, construction, domestic servitude and other labor-intensive jobs. Forced labor or labor trafficking often involves the use of a plan, or pattern, creating a climate of fear to make people believe there would be serious consequences if they attempted to leave their workplace.
Debt bondage, debt servitude, or bonded labor is holding a person in compelled service by a real or alleged debt. Traffickers use debt as a coercive scheme to trap their victims—they create the initial debt through inflated recruitment and transportation fees. They may add to it by charging unreasonable amounts for room and board and other needs. They may also supposedly apply wages directly to this seemingly never-ending debt that must be paid before the worker can be released. In parts of Africa and Southeast Asia, people are also enslaved by ancestral debts.
This prevalent form of trafficking affects every region in the world. Women and children from developing countries and from vulnerable parts of society in developed countries and refugees of war and failed states, are lured by promises of decent employment into leaving their homes and travelling to what they consider will be a better life. Victims are often provided with false travel documents and an organized network is used to transport them to the destination country, where they find themselves forced into sexual slavery and held in inhumane conditions and constant fear. It is seen in street and on-line prostitution, brothels, massage parlors, and escort services.
In the case of sex trafficking, exploitation implies the forced prostitution or sexual abuses of vulnerable men, women, and children. The United States’ Trafficking Victims Protection Act (TVPA) declares it a crime to coerce, force, or mislead men, women, and children into sex slavery, whether those efforts to coerce are subtle or overt. However, if a victim is a minor (under 18), it is a considered a crime regardless if there is evidence of force, fraud, or coercion. Many of the statutory definitions of human trafficking require the prosecution to prove the mental state of the victim, rather then focus on the actions of the perpetrator. Slowly, the laws are being revised.
Exploitation of Children in Tourism
This crime type has been active in Asia for many years and has spread to Africa and Central and South America. The expansion of the crime is due to the relatively low risk of prohibition and prosecution in these destinations for engaging in sexual relations with minors.
Trafficking for tissue, cells and organs
Trafficking in humans for the purpose of using their organs, in particular kidneys, is a rapidly growing field of criminal activity. In many countries, waiting lists for transplants are very long, and criminals have seized this opportunity to exploit the desperation of patients and potential donors. The health of victims, even their lives, is at risk as operations may be carried out in clandestine conditions with no medical follow-up. An ageing population and increased incidence of diabetes in many developed countries is likely to increase the requirement for organ transplants and make this crime even more lucrative.
Closely connected to trafficking in human beings is the issue of people smuggling. This has taken on new proportions in recent years, especially in the Mediterranean region, and it is clear that organized criminal networks are taking advantage of the Syrian humanitarian crisis for financial gain.
Child soldiering comprises boys and girls recruited or used by an armed force or armed group in any capacity, including as fighters, cooks, porters, messengers, spies, or for sexual purposes and marriage. In some countries, the use of child soldiers is systematic and pervasive.
The Good and Bad of Rescue Operations
Rescue operations that are funded with lucrative government contracts may exploit victims and refugees, and refugee profiteering is an area where lawyers may see an opportunity to stop exploitation on a large scale. In Germany where the nation is absorbing over 1 million refugees, corporations that can provide immediate shelter are profiting at the expense of the refugees. Berlin’s State Office of Health and Social Affairs has been using abandoned train terminals, gymnasiums, army barracks, vacant buildings, and 42,000 tents to house refugees that were arriving by the 1000’s. Some of the camps were set up in less than 24 hours.
And the profits are mounting. Container-Handelsbüro, won the largest contract in its history—23 million euros—to build 1,700 housing units. Another firm called Paranet tripled its annual profits in 2015 by selling giant inflatable domes to house refugees. One of the largest corporate beneficiaries of the crisis is European Homecare, formerly a niche company that has offered services for asylum seekers since the early 1990s. Now, it is Germany’s largest refugee housing provider, operating 100 facilities capable of hosting 20,000 people. Its revenues spiked from 17 million euros in 2013 to more than 100 million euros in 2015, the year the crisis hit Germany. See Vulture In the United States private contractors run substandard facilities.
Organizations have been racked by scandals from exploitation of children, fabrication of trafficking stories for fundraising, and maltreatment and abuse.
Every year “rescue” homes fail financially and fail the victims.
A comprehensive rescue operation that is properly funded and supervised is an essential.
How Can Law Help?
Civil remedies can be a powerful tool for survivors of human trafficking seeking redress from their traffickers. While survivors may have access to victim compensation funds or restitution, often the amount authorized under these types of statutes is not enough to compensate the survivor for all the harm they suffered. Depending on the state law, survivors may be able to seek: compensatory damages, punitive damages, injunctive relief, and attorney’s fees. Additionally, some statutes allow courts to award treble damages in cases where the defendant’s actions were willful and malicious.
Expunging and sealing criminal records can give victims a new chance.
A civil case is a way for a survivor to seek justice. If a criminal case is not brought then the civil case may be the only way a trafficker is held accountable for harm caused. Additionally, a civil case allows for the survivor to drive the case forward, and this can be an effective way for the survivor to reclaim control from the trafficker.
The Trafficking Victims Protection Reauthorization Act of 2003 created a federal right of action for survivors of trafficking. The federal law allows for survivors to recover actual damages, punitive damages, and reasonable attorney’s fees. Since the federal civil cause of action was established, many survivors have brought successful cases against their traffickers.
Currently, forty states and the District of Columbia specifically allow for survivors of trafficking to sue their trafficker. States vary on the amount and types of damages that can be awarded as well as on the statute of limitations for bringing a case.
In 2013, the Uniform Law Commission (ULC) released a Uniform Act on the Prevention of and Remedies for Human Trafficking (Uniform Act), which includes a section on civil remedy. This important section reinforces the need for specific civil remedy statutes for survivors of trafficking, which may inspire legislators to introduce legislation in their states. Additionally, the Uniform Act provides language that can be adopted by states that have already adopted a statute to make the relief available more consistent across the country so that victims have similar opportunities for relief.
Companies are increasingly being required to disclose how they assess and respond to the risks of human trafficking in their product supply chains. Statutes like the California Transparency in Supply Chains Act and the U.K. Modern Slavery Act require such disclosures. In addition, certain U.S. federal contractors are now required to develop detailed compliance plans to address the risks of trafficking associated with the good and services they provide to the U.S. Government.
As companies seek to address human trafficking-related risks, it is important to ensure that internal compliance efforts are appropriately integrated across the company. Corporate personnel focused on anti-corruption compliance efforts should be aware of the relative risk of human trafficking-related activities that may be associated with discrete aspects of the company’s operations, including the activities of its subsidiaries, business partners, and suppliers. These risks may be associated with specific geographies, the types of work being performed, and — especially — the use of labor recruiters.
Companies should also recognize the risk of corruption-related liability associated with labor recruitment. Human trafficking is an extremely lucrative crime and is often dependent upon bribes being paid to immigration authorities, law enforcement officials, border control personnel, and other public officials. To the extent that a company is knowingly benefiting, directly or indirectly, from the cheap labor that results from such bribery, the company and/or its officers may face liability pursuant to the Foreign Corrupt Practices Act (“FCPA”). New reports by Liberty Asia and the Freedom Fund highlight the extensive links between corruption and human trafficking and explore the potential for corporate liability pursuant to both the FCPA and the Trafficking Victims Protection Act (“TVPA”).
In the face of such risks, companies need to understand their “labor supply chain” that is linked to their product supply chains. Due diligence on the sources of labor that a company relies upon should be a component of it anti-corruption efforts and a company should ensure that relevant personnel across the company are engaged in addressing interlinked corruption- and trafficking-related risks.
California Transparency in Supply Chains Act The California Transparency in Supply Chains Act, which was signed into law in October 2010 and went into effect in January 2012, requires certain companies to report on their specific actions to eradicate slavery and human trafficking in their supply chains. Aimed at mid-size and large retailers and manufacturing companies with worldwide annual revenues of $100 million or more, the law’s chief goal is to ensure companies provide consumers with information that enables them to understand which ones manage their supply chains responsibly. It is estimated that the reporting requirement will impact about 3,200 companies headquartered in California or doing business in the state.
Specifically, the law requires a company to disclose on its website its initiatives to eradicate slavery and human trafficking from its direct supply chain for the goods offered for sale. A company must disclose to what extent it: (1) engages in verification of product supply chains to evaluate and address risks of human trafficking and slavery; (2) conducts audits of suppliers; (3) requires direct supplies to certify that materials incorporated into the product comply with the laws regarding slavery and human trafficking of the countries in which they are doing business; (4) maintains accountability standards and procedures for employees or contractors that fail to meet company standards regarding slavery and human trafficking; and (5) provides employees and management training on slavery and human trafficking.
Foreign Corrupt Practices Act and SEC Regulation on Conflict Minerals Federal Acquisition Regulation (FAR)
When it comes to conflict minerals and federal reporting requirements, suppliers and their customers are increasingly recognizing that the breadth and scope of their compliance efforts extend far beyond simply meeting the terms of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Much of the conflict minerals compliance focus has been on U.S. publicly traded companies in meeting the requirements imposed by the Securities and Exchange Commission. However, thousands of more companies that are not subject to SEC rules are, in fact, facing possibly greater federal scrutiny related to the conflict minerals issue.
Inherently, the issue of conflict minerals extends far beyond determining whether a product may contain one or more of the four key raw minerals that are mined in the Democratic Republic of the Congo to help fund a deadly civil war in that country. The underlying factors behind the enactment of Section 1502 of Dodd-Frank deal with corruption, modern day slavery and human rights. Companies large and small that are providing services or products to the federal government face all of these issues and more when meeting federal contract terms and through auditing.
“The Federal Acquisition Regulation is perhaps the most far-reaching and complex federal contracting requirement,” A government contracting expert at Source Intelligence. “Any company linked to federal procurement – either under direct contract with the U.S. government or supplying those companies – are subject to federal audits, investigations and more.”
The general principle for companies and suppliers to follow is to “act” as if they are subject to the SEC rules for conflict minerals disclosure, even if they are not a publicly traded company. The due diligence involved in determining if a product contains conflict minerals provides an optimum framework to track, analyze and report on the connected issues – human trafficking and human rights violations, corruption, restricted substances and more.