Factories that abuse and underpay staff could be banned from sales under new watchdog

A new workers’ watchdog which will enforce rules on modern slavery and minimum wages has been proposed by the government.

There are also plans to bring in greater protection for agency workers and a new adjudicator to investigate company supply chains.

If brands are found to flout these rules, they could face having their goods banned from sale under the new watchdog.

At the moment, there are three different bodies that deal with these types of issues - the Gangmasters and Labour Abuse Authority, the Employment Agency Standards Inspectorate and HMRC’s National Minimum Wage Enforcement.

But the plans for a new watchdog will effectively combine all these authorities under one umbrella.

The government says the new watchdog will enhance workers’ rights by providing a single port of call for employees to blow the whistle on bad behaviour.

The watch has yet to be named by ministers (Getty Images/iStockphoto)

It will also have the ability to ensure vulnerable workers get the holiday pay and statutory sick pay they are entitled to.

Extra curbs aimed at targeting the clothing sector - including banning sales of brands who are found to allow bad behaviour - are being explored as well.

The government says this could work by either creating a Garment Trade Adjudicator, or by extending an agricultural licensing scheme.

Under that scheme, businesses who provide agricultural workers must have a license, and can be inspected to make sure they are meeting employment standards.

It comes after online retail giant Boohoo was last year alleged to have paid staff as little as £3.50 an hour in some UK factories.

This led to Boohoo launching an internal review and cutting its supplier network from an estimated 500 firms to under 100.

Following the claims, the retailer said it would "immediately disclose" any suggestions of modern day slavery "to the relevant authorities".

The plans for the new watchdog were confirmed in a consultation response today and come as part of wider efforts to protect workers’ rights.

Paul Scully, Business Minister, said: “This government has been absolutely clear that we will do whatever we can to protect and enhance workers’ rights.

“The vast majority of businesses want to do right by their staff, but there are a minority who seem to think the law doesn’t apply to them. Exploitative practices like modern slavery have no place in society.

“This new workers’ watchdog will help us crack down on any abuses of workers’ rights and take action against companies that turn a blind eye to abuses in their supply chains.”