Modern Slavery

Understand how Modern Slavery Reporting Requirements apply to your business and supply chains.

In Brief

  • The first Modern Slavery reporting period in Australia is predicted to be the 2019/2020 financial year and in order to be prepared, businesses are encouraged to proactively start evaluating supply chains
  • Australia has a Federal and NSW Act and businesses should be aware of implications and obligations under both pieces of legislation
  • New Zealand businesses will also be required to directly or indirectly comply with disclosure requirements

Modern Slavery still exists and affects people of any age, gender or race. Modern Slavery comes in many forms, from forced labour to debt bondage to child slavery and affects people and communities. The United Nations (UN) Global Compact Network in Australia estimates that 45.8 million are affected around the world with 66.4% of modern slaves being from the Asia-Pacific region, which includes Australia and New Zealand.

In 2015, the United Kingdom introduced the UK Modern Slavery Act (MSA) 2015 which was the first of its kind in Europe, and one of the first in the world, to specifically address slavery and trafficking in the 21st century. The UK Modern Slavery Act applies to companies turning over £36 million, capturing around 19,000 businesses.

In June 2018, the first Modern Slavery Bill was assented in NSW. Regulations are currently being drafted in NSW and will soon be open for public consultation. The Commonwealth Modern Slavery Bill was passed by both houses of parliament on the 29th of November 2018.

NSW Modern Slavery Act 2018 (Assented on 27 June, 2018)

Commonwealth Modern Slavery Bill 2018 (Passed on 29 November, 2018)

Reporting applicability

    - Commercial organisations with at least one employee in NSW
    - Threshold - total annual revenue turnover of at least A$50 million
    - Australia’s largest businesses (corporate and non-corporate Commonwealth entities)
    - Threshold – annual consolidated revenue of at least $100 million
    - Expected to cover about 3,000 companies

Exemptions

Organisations subject to a prescribed equivalent federal, territory or state law

None

Form of publication

Annual modern slavery statement -

The NSW Anti-Slavery Commissioner maintains a register of statements publicly available online.

Annual modern slavery statement -

The Bill establishes a register of statements, maintained by the Minister which is publicly available online.

Expected start date

After the end of the financial year, as provided for by regulations not yet published.

Within six months of the end of the reporting period –a final year starting after the commencement of this section of the Act.

Expected reporting requirements

At minimum:

    - The organisation's structure, its business and its supply chains
    - Due diligence processes
    - Risk of modern slavery taking place and steps taken to assess and manage that risk
    - Training on modern slavery available to employees

At minimum:

    - Identity, structure, operations and supply chains of reporting entity
    - Describe risks of modern slavery practices in operations and supply chains
    - Actions taken to address modern slavery risks (including due diligence and remediation processes); effectiveness of such actions
    - Description of consultation processes

Non-compliance penalties

Penalties of up to 10,000 penalty units (equivalent to A$1.1 million) will apply to companies for:

    - failing to prepare a modern slavery statement;
    - failing to publish in accordance with Regulations; and
    - providing false and misleading information in a modern slavery statement.
    - Publication of entity identity information and further information relating to the failure to comply which may result in reputational damage.
    - Can give rise to corporate and director liability under the Criminal Code – if inadequate preventative due diligence is indicated.

Further monitoring/ governance controls

Establishment of Anti-Slavery Commissioner and Modern Slavery Committee:

    - raise public awareness of modern slavery
    - monitor effectiveness of due diligence procedures
    - maintain register of modern slavery statements

The statement must be:

    - approved by the principal governing body of the entity
    - Signed by a responsible member of the entity
    - Given to minister within six months of the reporting period.

NSW Modern Slavery Bill

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Commonwealth Modern Slavery Bill

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New Zealand

Although New Zealand has no formal Modern Slavery requirements, EY has estimated that Australia’s Federal legislation would require up to 500 New Zealand businesses to comply with disclosure requirements, either directly or in response to requests for information from other companies that will be required to report. Employment New Zealand recently released "Practical steps to identify and mitigate labour rights issues in your supply chain" a publication which has been designed to assist businesses that are making those initial steps to identify and tackle labour rights in their supply chains.