In June 2018, the Australian state of New South Wales (NSW) passed the Modern Slavery Act (MSA) 2018.
After the federal government’s May 2018 announcement proposing a Modern Slavery Act, the introduction of state-level legislation is a monumental step forward for the country as it anticipates national legislation. The act provides for the appointment of a state-level independent Anti-Slavery Commissioner, whose duties include: encouraging action to combat modern slavery; supporting victims; monitoring reporting concerns; collaborating with government and NGO agencies, and making recommendations where possible; and maintaining a publicly available registry of statements.
A core difference between state and proposed national requirements is the threshold of annual turnover for commercial organizations. The state requirements stipulate that organizations with an annual turnover exceeding 50 million Australian dollars must produce an annual modern slavery statement, while the threshold proposed by the federal government only applies to companies whose annual turnover exceeds 100 million Australian dollars. Both would apply to foreign entities.
In the case of the NSW MSA, commercial organizations only need to meet the reporting threshold and have more than one employee in the state to be in scope of the act. Another notable difference from the federal act is the application of penalties for failure to produce and make an annual statement public, or for providing information that is false or misleading. Under the NSW MSA, annual reports should include information on:
- Organizational structure, business operations and supply chains.
- Due diligence processes, including those related to modern slavery, in the business and supply chains.
- The parts of the business and supply chains where a risk of modern slavery exists, and the steps taken to assess and manage that risk.
- The training about modern slavery available to employees.
The act also requires a state-level commissioner to monitor the effectiveness of the government’s own due diligence procedures to ensure goods and services procured by government agencies are not supporting modern slavery.
The MSA sets a strong framework for action despite the fact that certain details, such as time frames for reporting, won’t be known until the NSW government issues associated regulations. This means companies must ensure they are able to identify and mitigate any risks they discover, and demonstrate they have available training on modern slavery in order to remain compliant.
As part of their corporate social responsibility program, companies can survey their supply chains to collect data on slavery and human trafficking risks to ensure compliance with reporting requirements and avoid penalties. Australian companies should conduct due diligence activities to get ahead of the Australian Modern Slavery Act slated to come into effect later this year. When it is passed many companies may find they only need to report under the national act, as the NSW MSA provides an exception for companies subject to obligations under a corresponding law of the Commonwealth.
For a complete guide to establishing a corporate social responsibility program at your company, download the eBook Corporate Social Responsibility: A Quick Start Guide to CSR & Your Supply Chain.
Assent’s Human Rights Module, part of the Corporate Social Responsibility Suite, helps companies automate data collection and validation and ensure demonstrable due diligence throughout their supply chains. It enables companies to identify and assess risk, automate risk screening for human rights, and show year-over-year improvement in efforts to eradicate human trafficking and slavery. With Assent, companies can also leverage the Assent University Classroom, the industry-leading compliance learning management system, to educate and train their internal employees and suppliers on human trafficking and slavery.
For more information on the Corporate Social Responsibility Suite or the Assent University Classroom, and how Assent can help your company meet your CSR program requirements, contact us at info@assentcompliance.com.