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Establishing a Modern Slavery Act in Australia

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Modern Slavery Act 2018 No. 153, 2018 took effect on 1 January 2019

Follow our blog series Reflections on the Australian Modern Slavery Act and Beyond for key perspectives

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  1. Why establish a Modern Slavery Act in Australia?

The Global Slavery Index of Walk Free Foundation estimates there are about 4,300 slaves in Australia. The US Department of State notes that some migrant workers from Asia and several Pacific Islands, recruited to work temporarily in Australia in agriculture, construction, hospitality, and domestic service were found to be in forced labour. Further, Australian companies may be implicated in using forced labour in their supply chains through sourcing goods and services domestically and internationally. Some Australian business are speaking out about discovering modern slavery in their supply chains.

By introducing an Australian Modern Slavery Act, the Australian Government has an opportunity to show leadership domestically and in the region to protect victims and eradicate modern slavery. An Australian Modern Slavery Act is needed to complement and build on existing voluntary initiatives, laws and international standards, in order to address unregulated gaps in global markets and harness the power of business.

Further, an Australian Modern Slavery Act would create a level playing field for companies, and improve the level of corporate disclosure to the benefit of stakeholders including civil society, investors, consumers, academia and business itself. The Modern Slavery Act in the UK has demonstrated it can create change, by elevating modern slavery as an issue discussed mostly by ethical sourcing staff, ethical consumers and investors, to a priority issue discussed by average consumers, mainstream investors, both buyers and suppliers and, crucially, senior corporate management. Companies reported to Business & Human Rights Resource Centre that the UK Act empowers internal advocates within companies, enabling them to both internally through access to senior management, as well as externally with ammunition to have conversations with and enforce standards at suppliers.

The UK Act also significantly increased transparency. While many of the thousands of statements on the Modern Slavery Registry are patchy, never before have so many companies made at least some information available on what their business structures and supply chains look like, and how they undertake due diligence.

But, most importantly, the Act is driving action. Statements show that a number of a number of companies are developing or revising existing policies and due diligence processes to address modern slavery, such as risk assessments, staff training, or supplier contracts. In fact, a report by the Ethical Trading Initiative and Hult International Business School found that in the year since the UK Act came into force, CEO engagement with modern slavery has doubled, companies are collaborating more with peers, NGOs and multi-stakeholder initiatives, and business-to-business communication and pressure has increased significantly. 

Sources:

  1. Australian Government Public Consultation on proposed model of Modern Slavery in Supply Chains Reporting Requirement

On 16 August 2017, the Australian Government announced its intention to introduce legislation that will require large businesses to report annually on actions taken to address modern slavery, including in their supply chains. It released a consultation paper on a proposed model for the Modern Slavery in Supply Chains Reporting Requirement. It is proposed that this reporting requirement will require large corporations and other entities operating in Australia to publish annual statements outlining their actions to address modern slavery in their operations and supply chains. A central repository for modern slavery statements is also proposed.

The government conducted a public consultation which, together with the Parliamentary inquiry process (see below), will help determine the final content of the proposed legislation. A  series of stakeholder roundtables were convened between August and December 2017. Written submissions were also invited. Submissions closed on 20 October 2017. The government's high-level outline of key issues raised during the consultation roundtables is available here. Submissions received through the government's consultation process can be accessed here. The government has confirmed that 98% of submissions support government action to address modern slavery.

The Advisory Committee of the Modern Slavery Registry (Business & Human Rights Resource Centre, Humanity United, Freedom Fund, Anti-Slavery International, Ethical Trading Initiative, Trades Union Congress (TUC), CORE Coalition, Unicef UK, Focus on Labour Exploitation (FLEX) and Freedom United) has published its recommendations to the Australian Government on the introduction of a supply chains reporting requirement in Australia.

The Advisory Committee recommends the Australian government incorporates strong compliance drivers in the proposed reporting requirement for qualifying businesses headquartered, or operating, in Australia. 

These compliance drivers include:

  • financial penalties for non-compliant qualifying entities;
  • ​free, independent and publicly-accessible central repository of annual statements;
  • public list of companies required to comply with the reporting requirement; and
  • public procurement incentives for compliance.

The full submission is available here. 

On 15 February 2018 at a Freedom Partnership and Walk Free event, Alex Hawke MP, Assistant Minister for Home Affairs, reaffirmed the Australian Government's commitment to introduce a Modern Slavery Act into Parliament in the first half of 2018, to be enacted by the end of 2018. 

In May 2018 the government announced the key features of the new legislation.

On 28 June 2018 the government introduced the Modern Slavery bill  to Parliament. 

The Senate referred the provisions of the Modern Slavery Bill 2018 to the Legal and Constitutional Affairs Legislation Committee for inquiry. 

The deadline for submissions to the Senate inquiry closed on 20 July 2018. Submissions made to the Senate inquiry can be accessed here. The Advisory Committee to the Modern Slavery Registry's submission is here. 

The Advisory Committee's submission recommends that the Bill be strengthened in the following ways:

  1. A public list of companies required to report under the Modern Slavery Reporting Requirement.
  2. Reporting entities be required to publish Modern Slavery Statement on their website.
  3. Reporting entities be required to describe the actions taken to identify the risks of modern slavery practices in their operations and supply chains.
  4. Explanatory statements by Minister regarding  registration decisions about non-compliant Modern Slavery Statements.
  5. Public procurement incentives for compliance (non-compliant reporting entities to be excluded from public tenders).
  6. Criteria for an effective Modern Slavery Register.
  7. Clear and comprehensive govt. guidance, supported by a public awareness campaign.
  8. Financial penalties to be phased-in after three years, if low reporting levels or standards warrant it.

Following its inquiry, the Senate Legal and Constitutional Affairs Legislation Committee released its report on 24 August 2018. Parliamentary debate on the Bill followed on 12 September and 17 September 2018, with Labor proposing changes to introduce financial penalties, an independent commissioner and annual ministerial statement on compliance by reporting entities. The Modern Slavery Bill (Cth) passed the House of Representatives on 17 September 2018 and went to the Senate for further consideration. 

In late November, the Australian Modern Slavery Bill reached the final stages of the legislative process, being passed by the Australian Senate on 28 November, with the Government's amendments approved. Following a repeat passage through the House of Representatives on 29 November (to approve amendments agreed in the Senate). After receiving royal assent on 10 December 2018, the Modern Slavery Act took effect on its commencement date, 1 January 2019.

3. Parliamentary Inquiry into establishing Modern Slavery Act 

A joint Parliamentary inquiry into whether Australia should adopt national legislation to combat modern slavery, comparable to the United Kingdom’s Modern Slavery Act 2015, commenced on 15 February 2017. 

An interim report was tabled in August 2017 summarising the evidence heard so far on global supply chain reporting. The report highlights the strong support from businesses, unions and NGOs for the introduction of supply chain reporting requirements for businesses and organisations operating in Australia. The report recommends that the Australian Government consider introducing a Modern Slavery Act in Australia, including a mandatory supply chain reporting requirement.

A final report was tabled on 7 December 2017 setting out final recommendations to the Australian Government.

The final report, Hidden in Plain Sight, recommends the following provisions be included in mandatory supply chain reporting provisions of an Australian Modern Slavery Act:

  • a central, government-funded, civil society-run repository of statements;
  • penalties for non reporting entities, to apply from second year of reporting;
  • a public list of entities required to report;
  • AUD$50m revenue threshold to determine entities required to report; and
  • public procurement application.

Please find here further information about the inquiry process.

The inquiry has received 225 submissions from a broad range of both domestic and international stakeholder groups and held 10 public hearings.

Below is an overview of businesses, investors and civil society organisations in support of the establishment of a Modern Slavery Act in Australia. 

Business support:

Investor support:

Civil society submissions:

Academia submissions:

Government and political party support:

Trade union submissions:

Additional stakeholder submissions: 

All full list of all public submissions to the inquiry can be found here.

Further resources:

  1. Where can I learn more? Latest events and webinars

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