The United States maintains a multifaceted legal and policy framework addressing business and human rights (BHR). While the USA supports key international standards such as the UN Guiding Principles on Business and Human Rights (UNGPs), it has not endorsed a binding international treaty on BHR. Recent trends reflect a growing emphasis on responsible business conduct, particularly in areas such as forced labour prevention, supply chain transparency, and corporate accountability.

The United States has adopted and supported several international and regional instruments relevant to BHR:

• UN Guiding Principles on Business and Human Rights (UNGPs): The USA endorses the UNGPs and other international standards, though it has expressed opposition to a binding international treaty on BHR.
• ILO Conventions: The USA ratified the Abolition of Forced Labour Convention in 1991 and the Worst Forms of Child Labour Convention in 1999.
• OECD Guidelines: As a member of the OECD, the USA adheres to the OECD Declaration on International Investment and Multinational Enterprises, which includes the Guidelines for Multinational Enterprises on Responsible Business Conduct.
• UN Declaration on the Rights of Indigenous Peoples (UNDRIP): The USA supports UNDRIP but does not consider it legally binding or reflective of current international law.

Trafficking Victims Protection Act (TVPA)

The TVPA imposes both criminal and civil liability on corporations that benefit from human trafficking, including forced labour, particularly within foreign supply chains. A corporation may be held criminally liable if it acts with reckless disregard of the fact that it is financially benefitting from trafficking-related activities.

Victims may also bring civil claims under the TVPA. To establish liability, a plaintiff must demonstrate that the company benefitted from participating in a venture that it knew or should have known was engaged in forced labour or trafficking.

Key penalties include:

• fines of up to USD500,000 or twice the economic benefit derived from the violation;
• criminal prosecution of employees responsible for engaging in or facilitating trafficking, with potential imprisonment of up to 20 years; and/or
• restitution potentially awarded to victims in criminal proceedings;

The statute applies extraterritorially, allowing for prosecution of trafficking offences committed abroad if linked to US-based entities.

Fair Labor Standards Act of 1938 (FLSA)

The FLSA prohibits the shipment or delivery of goods produced in the United States using oppressive child labour. Violations may result in:

• fines of up to USD10,000; and/or
• imprisonment for wilful violations.

California Transparency in Supply Chains Act

The California Attorney General is authorised to pursue injunctive relief against companies that fail to comply with the Act’s disclosure requirements. This may include compelling a company to publish the required information on its website.

Conflict Minerals Rule

The SEC may impose civil penalties on companies that fail to comply with the Conflict Minerals Rule. However, in 2017, the SEC clarified that it would not enforce certain aspects of the rule – specifically, it would not penalise companies for failing to post the conflict minerals report on their websites, provided they otherwise comply with the rule’s requirements.

Civil Rights and Anti-Discrimination Laws

Corporations may face civil litigation for violations of federal and state anti-discrimination laws. Under Title VII of the Civil Rights Act of 1964, individuals are protected from discrimination based on race, colour, religion, sex, and national origin, particularly in employment-related matters such as hiring, promotion, and compensation.

Nearly every US state has enacted its own anti-discrimination laws, which may mirror or expand upon federal protections.

Consumer Protection-Based Liability

In recent years, plaintiffs in states such as California and Massachusetts have increasingly turned to consumer protection statutes to hold corporations accountable for alleged human rights abuses in their supply chains. These legal actions typically focus on a company’s failure to disclose the use – or risk – of forced labour in the production of goods, arguing that such omissions or misrepresentations mislead consumers.

Legal Basis and Case Examples

In 2015, a series of six class action lawsuits were filed in California federal courts against major corporations. The plaintiffs alleged that these companies failed to disclose the use of forced labour in their supply chains, particularly in regions such as Thailand and West Africa. The claims were brought under California’s Unfair Competition Law (UCL), False Advertising Law (FAL), and the Consumer Legal Remedies Act (CLRA).

To succeed under these statutes, plaintiffs generally must demonstrate that the company made false or misleading representations about its products – especially regarding ethical sourcing – and that consumers were harmed as a result of relying on those representations.

Key Elements of a Consumer Protection Claim

False or misleading representations

• Misstatements About Ethical Sourcing: Companies may claim their products are ethically sourced, produced under fair labour conditions, or environmentally sustainable, when in fact they are not.
• Omissions of Material Facts: Failing to disclose known or likely human rights violations in the supply chain may constitute a deceptive practice under consumer protection laws.
• “Greenwashing” and “Ethics Washing”: Overstating a company’s commitment to social responsibility or sustainability without substantive action can mislead consumers and form the basis of liability.

Knowledge or reckless disregard

• Failure to Conduct Due Diligence: Companies are expected to investigate their supply chains for human rights risks. A lack of audits, supplier assessments, or other due diligence measures may indicate reckless disregard.
• Awareness of Violations: If a company is aware of forced labour or other abuses and fails to act – or continues to source from problematic suppliers – it may be held liable.
• Supplier Misconduct and Corporate Control: A company may be responsible for its suppliers’ actions, particularly if it exercises significant control or influence over them.

Causation and consumer harm

• Demonstrating Harm: Plaintiffs must show that they relied on the company’s representations and that this reliance caused them harm – such as economic loss, reputational damage, or the purchase of goods they would not have otherwise bought.
• Establishing Causation: There must be a clear link between the company’s deceptive conduct and the consumer’s injury.

Even when a corporation is held liable for a legal violation, its corporate officers and directors may also be subject to personal liability for their individual involvement in the unlawful conduct. The determination of liability for directors and officers depends on the specific legal claims asserted against both the corporation and the individuals.

Generally, to establish personal liability, it must be shown that the director or officer had knowledge of the alleged violation and/or directed, participated in, or benefitted from the misconduct.

For example, under the Trafficking Victims Protection Act (TVPA), directors and officers may be held criminally liable if they:

• knowingly benefit from a violation of the Act; or
• act with reckless disregard of the fact that the company is engaged in conduct that violates the TVPA.

This framework underscores the importance of executive oversight and accountability in corporate compliance with human rights obligations.

A parent company may generally be held both criminally and civilly liable for the actions of its subsidiary, particularly where the parent exercises excessive control and fails to maintain the subsidiary’s separate legal identity.

Courts may choose to pierce the corporate veil and impose liability on the parent company based on several key factors, including:

• the degree of influence the parent company exerts over the subsidiary’s operations, decision-making, and management;
• commingling of assets between the parent and subsidiary;
• failure to observe corporate formalities, such as maintaining separate books, records, and governance structures; and
• representation of the subsidiary by the parent as an extension of itself, rather than as a distinct legal entity.

Whether a parent company can be held liable is a fact-specific inquiry that depends on the nature of the claims and the surrounding circumstances. Courts will assess the totality of the relationship between the parent and subsidiary to determine whether liability is appropriate.

Enforcement of Section 307 by U.S. Customs and Border Protection

Since 2016, U.S. Customs and Border Protection (CBP) has significantly increased its enforcement of Section 307 of the Tariff Act of 1930 (19 U.S.C. § 1307), which prohibits the importation of goods produced, wholly or in part, with forced labour.

CBP utilises two primary enforcement mechanisms:

• Withhold Release Orders (WROs): CBP issues WROs when there is a reasonable suspicion that goods were produced using forced labour. Upon issuance, CBP detains the goods at the port of entry. If the importer fails to successfully contest the WRO or remove the goods from the United States, CBP is authorised to seize and destroy the merchandise.

• Findings: Following a more conclusive investigation, CBP may issue a formal Finding that establishes goods were produced with forced labour. If an importer cannot provide sufficient rebuttal evidence demonstrating that the goods were not made with forced labour, CBP may proceed to seize and destroy the goods in question.

These enforcement tools reflect the US government’s commitment to preventing the entry of goods linked to exploitative labour practices and ensuring compliance with federal trade and human rights standards.

California Consumer Protection Lawsuits

In August and September 2015, six class action lawsuits were filed in federal courts in California against various companies for allegedly failing to disclose the use – or risk – of forced labour in their supply chains, particularly in Thailand and West Africa. Each case alleges violations of California’s consumer protection and unfair competition statutes.

The plaintiffs argue that the companies had a duty to disclose the presence or likelihood of forced labour due to their superior knowledge of their own supply chains. This duty, they contend, was further reinforced by the companies’ public representations that they prohibit forced labour among their suppliers.

These representations were found in several sources, including:

• supplier codes of conduct;
• corporate social responsibility (CSR) reports;
• public business principles; and
• disclosures made under the California Transparency in Supply Chains Act;
• industry-wide commitments to ethical sourcing, to which some defendants were signatories

The lawsuits claim that by omitting material information about labour practices, the companies misled consumers and violated their legal obligations under California law.

Sample case: Wirth & Wagner v. Mars, Inc., No. 15-cv-1470, 2016 U.S. Dist. LEXIS 14552 (C.D. Cal.)

On 10 September 2015, plaintiffs Christina Wirth and Adam Wagner filed a proposed class action lawsuit against Mars, Inc., alleging violations of California’s Unfair Competition Law (UCL), Consumer Legal Remedies Act (CLRA), and False Advertising Law (FAL). The case centres on Mars’ Iams brand cat food, which contains seafood sourced from Southeast Asia, specifically the waters between Thailand and Indonesia.

Allegations of forced labour in the supply chain

Mars sources seafood for its Iams products through its Thai partner, Thai Union Frozen Products PCL. Thai Union procures fish from canneries that rely on large “motherships”, which in turn collect seafood from smaller fishing boats. These smaller vessels, which rarely return to port, have been linked to forced labour practices by both the U.S. Department of Labor and investigative journalism reports. The plaintiffs describe these working conditions as dangerous and inhumane.

According to the complaint, once the fish is collected by the motherships, it becomes mixed with other seafood, making it impossible to trace whether any specific product contains fish caught using forced labour.

Failure to disclose and consumer harm

The plaintiffs argue that Mars failed to disclose the likelihood that forced labour was used in its supply chain – both on product packaging and on its corporate websites. They claim that Mars had a duty to disclose this information due to its superior knowledge of its supply chain and its extensive experience in sourcing and marketing seafood-based pet food.

Wirth and Wagner allege they were harmed by this omission, stating they would not have purchased Iams products – or would have paid less – had they known about the potential use of forced labour in the supply chain.

This case, along with the other California consumer protection lawsuits, was ultimately dismissed but highlights a unique pathway to courts for consumers.

Chiquita terrorism financing litigation

Background

In 2007, Chiquita Brands International pleaded guilty to making over USD1.7 million in payments to the United Self-Defense Forces of Colombia (AUC), a designated terrorist organisation. Although Chiquita recorded these as “security payments”, it admitted receiving no actual security services in return.

Following the plea, hundreds of plaintiffs – relatives of individuals killed by the AUC – filed lawsuits in US courts. They alleged that Chiquita’s financial support to the AUC constituted actionable torts under the Alien Tort Statute (ATS), the Torture Victim Protection Act (TVPA), and other legal theories, including Colombian and state common law. The cases were consolidated in the Southern District of Florida.

Litigation history

Between 2011 and 2019, over 5,000 wrongful death claims were filed. Some were dismissed or settled, while others reached the Eleventh Circuit on appeal. In 2019, with only Colombian law claims remaining, plaintiffs sought class certification, which was denied. That same year, the district court granted summary judgment for Chiquita, citing insufficient admissible evidence. However, in 2022, the Eleventh Circuit partially reversed, allowing the case to proceed to trial.

Jury verdict (June 2024)

In the first bellwether trial, the jury found in favour of eight out of nine plaintiffs, awarding USD2–2.7 million per victim. The jury concluded that Chiquita knowingly provided substantial assistance to the AUC, failed to act as a reasonable businessperson, and engaged in conduct that foreseeably caused harm.

Legal implications and takeaways

Although the jury verdict was based on Colombian law, the case underscores the growing use of US statutes to hold corporations accountable for international misconduct:

• the Alien Tort Statute (ATS) grants jurisdiction over civil actions by non-US citizens for torts violating international law or US treaties;
• the Torture Victim Protection Act (TVPA) allows foreign nationals to sue individuals for torture or extrajudicial killing; and
• the Anti-Terrorism Act (ATA) provides a private right of action for US nationals injured by international terrorism, including treble damages and attorney’s fees.

Recent developments, such as the 2016 Justice Against Sponsors of Terrorism Act (JASTA), have expanded ATA liability to include aiding and abetting. Additionally, the Ninth Circuit’s 2023 decision in Doe I v. Cisco Systems affirmed that US corporations can be held liable under the ATS for aiding and abetting human rights abuses.

The aforementioned statutes offer powerful avenues for victims of international wrongdoing to seek redress in US courts.

Nestlé USA, Inc. v. Doe, 141 S. Ct. 1931 (2021)

Background

Six Malian nationals alleged they were trafficked as children and forced to work on cocoa farms in Côte d’Ivoire. They filed suit under the Alien Tort Statute (ATS) against US-based companies Nestlé USA, Inc. and Cargill, Inc., claiming the companies aided and abetted child slavery by providing financial and technical support to the farms in exchange for exclusive cocoa purchasing rights.

Legal issue

Whether the plaintiffs could bring claims under the ATS for conduct that occurred primarily outside the United States, and whether general corporate decision-making in the USA was sufficient to establish jurisdiction under the ATS.

Supreme Court holding

The Court held that the plaintiffs’ claims constituted an impermissible extraterritorial application of the ATS. The Court emphasised that:

• the ATS does not apply extraterritorially unless Congress clearly indicates otherwise;
• the plaintiffs failed to allege sufficient domestic conduct relevant to the statute’s focus; general corporate activity, such as decision-making in the USA, is not enough to support a domestic application of the ATS; and
• nearly all alleged conduct aiding and abetting forced labour occurred abroad.

Majority opinion (Justice Thomas)

The Court reversed the Ninth Circuit’s decision, stating that the plaintiffs did not plead a proper domestic application of the ATS. Furthermore, the Court declined to create a new cause of action under the ATS, reaffirming that such authority lies with Congress, not the judiciary.

Concurring opinions

• Justice Gorsuch (joined in part by Justices Alito and Kavanaugh) argued that courts should not create new causes of action under the ATS and that corporations should not be immune from suit under the statute.
• Justice Sotomayor (joined by Justices Breyer and Kagan) agreed with the judgment but defended the continued viability of judicially recognising causes of action under the ATS for well-established international norms.

Dissent (Justice Alito)

• Justice Alito argued that the Court should have addressed whether domestic corporations can be held liable under the ATS and criticised the majority for avoiding this central question.

Bostock v. Clayton County, Georgia 140 S. Ct. 1731 (2020)

Background

Gerald Bostock, the plaintiff, served for a decade as a child welfare advocate for Clayton County, Georgia. After he began participating in a gay recreational softball league, the county terminated his employment, citing conduct “unbecoming” of a county employee. Bostock filed suit in federal court, alleging sex discrimination under Title VII of the Civil Rights Act of 1964. The district court dismissed the claim, holding that Title VII did not extend to discrimination based on sexual orientation, and the Eleventh Circuit affirmed.

In contrast, two other federal appellate courts reached the opposite conclusion in similar cases. In one, Donald Zarda, a skydiving instructor, was fired shortly after disclosing that he was gay. In another, Aimee Stephens, who had worked for years at a funeral home while presenting as male, was dismissed after informing her employer of her intention to live and work as a transgender woman. The Second and Sixth Circuits, respectively, held that Title VII prohibits employment discrimination based on sexual orientation and gender identity.

To resolve the circuit split, the U.S. Supreme Court consolidated the three cases and granted certiorari to determine whether Title VII’s prohibition on sex-based discrimination encompasses discrimination based on sexual orientation and gender identity.

Legal issue

Does Title VII’s prohibition on discrimination “because of sex” include discrimination based on sexual orientation and gender identity?

Supreme Court holding

Yes. In a 6–3 decision, the Court held that an employer who fires an individual merely for being gay or transgender violates Title VII.

Majority opinion (Justice Gorsuch)

• The Court applied a textualist approach, focusing on the ordinary public meaning of the statute’s language in 1964.
• It concluded that discrimination based on sexual orientation or gender identity necessarily involves treating individuals differently because of their sex.
• For example, if a man is fired for being attracted to men, but a woman is not, the employer is discriminating based on sex.
• The Court emphasised that Title VII’s protections apply to individuals, not groups, and that “but-for” causation is sufficient to establish liability.

Concurring Justices

Chief Justice Roberts and Justices Ginsburg, Breyer, Sotomayor, and Kagan joined the majority.

Dissenting opinions

• Justice Alito (joined by Justice Thomas) argued that the Court was legislating from the bench by expanding Title VII beyond its original meaning and intent.
• Justice Kavanaugh agreed that the policy outcome was desirable but maintained that the change should come from Congress, not the judiciary.

Significance

This landmark decision extended federal employment protections to LGBTQ+ individuals, marking a major civil rights victory. It clarified that Title VII’s ban on sex discrimination encompasses discrimination based on sexual orientation and gender identity.

USNCP

The USNCP operates a grievance mechanism known as the “Specific Instance” process, established under the framework of the OECD Guidelines for Multinational Enterprises. This mechanism allows individuals or organisations to raise concerns regarding the conduct of enterprises that may be inconsistent with the OECD Guidelines.

To initiate a Specific Instance, the submitter must provide sufficient and detailed information. The following criteria must be met for a submission to be considered admissible:

• The submitter must have a specific interest in the matter, be in a position to provide relevant information, and have a clear objective for the outcome they seek.
• The complaint must clearly identify the chapters or paragraphs of the OECD Guidelines that are alleged to have been breached.

If the USNCP determines that the submission is material, substantiated, and meets the OECD’s admissibility criteria, it will contact the parties involved and offer mediation to facilitate resolution. For cases that proceed to mediation, all parties are required to sign the CBI Mediation Agreement, which includes confidentiality provisions and functions as a Non-Disclosure Agreement (NDA).

While the USNCP encourages the publication of mediation agreements, the decision to disclose specific terms rests with the parties involved.

Upon conclusion of the process, the USNCP drafts a Final Statement, which is made public following review and comment by the parties. Where possible, and with mutual agreement, the terms of any resolution reached through mediation are also disclosed to promote transparency and accountability.

Between 2017 and 2025, the USNCP published 14 Final Statements resulting from Specific Instance submissions.

The USNCP provides a range of resources to support businesses in implementing best practices related to human rights. These resources include the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct, which serve as a foundational framework for corporate responsibility. The USNCP emphasises the importance of due diligence, noting:

“Companies implementing due diligence processes are much better equipped to handle actual and potential adverse impacts. Due diligence processes may also reduce the risk of becoming the subject of complaints.”

In addition, the U.S. Department of State, in collaboration with non-governmental organisations (NGOs), administers the Responsible Sourcing Tool (www.responsiblesourcingtool.org). This platform offers practical guidance and information to assist companies in identifying and eliminating human trafficking risks within their supply chains.

The United States’ NAP on Responsible Business Conduct articulates the federal government’s expectations regarding corporate HRDD. Specifically, the NAP states:

“The government expects businesses to conduct HRDD throughout their value chains in line with internationally recognized standards set out in the UN Guiding Principles on Business and Human Rights (UNGPs), the OECD Guidelines, and the International Labor Organization’s (ILO’s) Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy (MNE Declaration). Businesses should treat these standards and principles as a floor rather than a ceiling for implementing responsible business practices while incorporating lessons learned and striving for continuous improvement.”

The US government expects all businesses, regardless of size, sector, operational context, ownership, or structure, to integrate HRDD into their operations and supply chains.