A More Stringent Modern Slavery Act Could Be On The Way

How Secure Is Your Supply Chain?

The Modern Slavery Act came into effect in January 2019. Its intention is to make sure that Australian businesses, as far as reasonably possible, ensure that no slavery or coercive practices exist in their supply chains. In other words, companies must now be proactive and diligent; turning a blind eye is no longer a possibility.

By bringing in the Act, the Australian government made it clear that there can be no place for modern slavery in Australia or in the global supply chains which cater to Australian businesses.

Modern slavery - Burmese workers are transported to work in a caged van

The Act

One of the key components of the Act introduced a requirement for businesses to identify, address and report on modern slavery risks, and maintain responsible and transparent supply chains.

This annual reporting mandate currently applies only to businesses with an annual revenue of $100 million or more. The reports must set out what actions a company has taken to assess and to deal with modern slavery risks. The statements are made available via a central repository – the Modern Slavery Statements Register.

Proposed Revisions To The Act

In May 2023 a statutory review of the Act was concluded which made numerous recommendations for the government to consider strengthening the legislation.

The main recommendations were as follows, intended to widen the responsibility to more businesses and introduce penalties for non-compliance:

  • penalties for non-compliance with statutory reporting requirements
  • lowering the revenue threshold from $100 million to $50 million
  • requirement for companies to report on modern slavery incidents or risks
  • requirement for companies to have a due diligence system in place
  • strengthening the administration of the Act through legislative amendments and expanded administrative guidance
  • proposing functions related to the Act for the federal Anti-Slavery Commissioner.

The full report can be found here.

What's Your Position?

Modern slavery can occur in just about any industry. Its use distorts global markets, undermines responsible businesses and poses potentially catastrophic reputational risks to brands.

Whilst any concrete revisions to the act might yet take some time to materialise, it’s highly likely that more Australian businesses will need to start looking closely at their supply chains, particularly given the likelihood of non-compliance penalties being introduced.

Any business in Australia which has any concerns about their company’s modern slavery compliance either now or in the near future, is welcome to contact BWES’ resident compliance expert, Maria Velez.

This communication (including any attachment) has been prepared by BWES and is based on the available information at the time of publication and is believed to be true and accurate. The information contained in this communication should be used as a guide only and may cease to apply if applicable regulation or the product’s design or application is altered. BWES does not take responsibility for any Injury, Loss for damage suffered by any party’s interpretation or decisions made by any party on the information provided in this communication.