The New South Wales parliament passed the Modern Slavery Act 2018 (NSW) in June last year.
Not to be outdone, the Federal Parliament passed the Modern Slavery Act 2018 (Cth) in December.
So what do the two different pieces of legislation require from businesses?
Which Businesses are covered by these new Laws?
Firstly, the laws only apply to “big business” – based on turnover.
The NSW Act applies to “commercial organisations”;
- with employees in New South Wales;
- who sell goods and services for profit; and
- with an annual turnover exceeding $50 million.
The Federal Act applies to entities with consolidated annual revenue in excess of $100 million.
Compliance Obligations – NSW Act
The NSW Act requires commercial organisations covered by the Act to compile an annual “Modern Slavery Statement” regarding;
- structure, business and supply chains;
- internal policies, due diligence and remediation processes relating to modern slavery;
- key risk areas for potential modern slavery malpractice and any steps undertaken to assess and manage those risks; and
- training practices in respect of modern slavery.
There are significant penalties (exceeding $1m) in the NSW Act for failing to publish a report as required. The Act also establishes the independent NSW Anti-Slavery Commissioner to investigate and enforce compliance.
Compliance Obligations – Commonwealth Act
The Federal law requires businesses covered by the Act to “report annually on the risks of modern slavery in their operations and supply chains, and actions to address those risks“.
It is fair to say that the aspects of the Federal law that were most controversial during its passage through the Parliament were that;
- there are no criminal penalties prescribed for non-compliance with the reporting requirement; and
- there is no “independent regulator” to ensure compliance.
Instead the government has said that it will “name and shame” those organisations that fail to comply with their reporting requirements. Is this sufficient incentive for businesses to comply?
What Do you Need to Do Now?
If you are covered by one (or both) of the new laws, you should undertake a number of preparatory steps now including;
- determining which law you need to comply with (based on current and projected annual turnover);
- undertaking an audit of your operations and supply chain to determine the modern slavery risks associated with your business; and
- give consideration to the content of Modern Slavery Reports for submission to the regulators.
At the time of writing it appears the first reports will be due for submission during 2020.
The Australian Institute of Criminology estimates that there were between 1300 and 1900 victims of “modern slavery” in Australia between 2015 and 2017. Modern slavery refers to; human trafficking, slavery and slavery-like practices such as forced marriage and forced labour.