The taskforce was created two years ago following the Commission's wide-ranging inquiry into recruitment and employment practices in the sector. The inquiry revealed serious allegations of ill-treatment and discrimination against agency workers, and pregnant women in particular.

The inquiry also highlighted tensions between different nationalities working together in the sector. British workers were potentially being treated in a discriminatory way due to stereotypes about nationality and work ethic, and migrant workers claimed they suffered abuse and discrimination as a result of their nationality and language barriers.

While the Commission's review highlights clear signs of progress, it also reveals that challenges still exist within some firms - for example management coercion of workers and threatening behaviour, according to a report from the Commission.

The review includes a set of recommendations to tackle these issues, and the Commission will continue to work with processing firms, labour providers, supermarkets and other regulators to ensure that all workers are treated fairly.

The Commission's original inquiry revealed a culture in which a considerable number of workers reported physical and verbal abuse; a lack of proper health and safety protection; and poor treatment -particularly of pregnant workers - that posed risks to the health and safety of both mother and unborn baby.

Many workers had little knowledge of their rights and feared raising concerns would lead to dismissal. While migrant workers were most affected, British agency workers also faced similar mistreatment. The inquiry found recruitment practices that may have been discriminatory in that they indirectly blocked British workers from getting jobs in the industry, and were influenced by stereotypical views about the reliability of some nationalities.

The inquiry also uncovered frequent breaches of the law and licensing standards in meat processing factories – some of which supply the UK's biggest supermarkets - and the agencies that supply workers to them. It also highlighted conditions which flout minimum ethical trading standards and basic human rights.

The inquiry also found examples of good practice by individual firms. Therefore, rather than taking time consuming and potentially costly enforcement action, the Commission decided to work with, and support, the industry to improve its recruitment and employment practices.

As a result of the Commission's work, the major supermarkets and industry bodies identified and agreed management practices and key performance indicators to deal with most of the problems identified in the inquiry. These have already been rolled out to meat and poultry processing firms for most of the major supermarkets.

Follow up action taken by the industry has led to clear progress in the last twelve months, particularly in light of the difficult economic environment: on the whole, pregnant workers are treated significantly better; workers are no longer segregated by nationality or suffer physical abuse; and British workers interviewed no longer experienced difficulties registering with agencies due to their nationality.

To ensure that the industry continues to make progress, the Commission's review contains a series of recommendations for firms, agencies, supermarkets and government on issues including training for managers; audits by supermarkets of suppliers and agencies; support for workers raising issues of concern; and health and safety.

Mark Hammond, CEO of the Equality and Human Rights Commission said: "The Commission's original inquiry exposed serious flaws in the way the meat processing sector treated ITS workers. As the firms recognised these concerns, we decided that rather than taking expensive and bureaucratic enforcement action, the Commission would support, the industry to improve its own recruitment and employment practices.

"I'm pleased that our review finds that as a result of the actions taken by the industry working group set up by the Commission - which included representatives of supermarkets, agencies and processing firms - we have seen good progress in addressing the issues we identified.

"The review does find some areas which are still of significant concern. We are therefore recommending a further series of steps which will support the sector in continuing this progress and creating a more ethical supply chain which is in the interest of workers, suppliers and the supermarkets as well as supported by consumers. In the end, better businesses mean a better contribution to economic growth."