Australian Corporate Accountability Network of Australia

Focus Area

The Australian Government's Inquiry into Modern Slavery

What is Modern Slavery? 

Modern slavery is not a term defined in international law. It generally exists where a person’s freedom and ability to make choices for themselves have been undermined or removed.  The definition of forced labour, according to the International Labour Organization (ILO) Forced Labour Convention 1930 (No 29), forced or compulsory labour is: 'all work or service which is exacted from any person under the threat of a penalty and for which the person has not offered himself or herself voluntarily'.

The ILO Forced Labour Protocol (art 1(3)) explicitly reaffirms this definition.

This definition consists of three elements:

  1. Work or service refers to all types of work occurring in any activity, industry or sector including in the informal economy.
  2. Menace of any penalty refers to a wide range of penalties used to compel someone to work.
  3. Involuntariness: The terms 'offered voluntarily' refer to the free and informed consent of a worker to take a job and his or her freedom to leave at any time. This is not the case for example when an employer or recruiter makes false promises so that a worker take a job he or she would not otherwise have accepted. This covers a wide spectrum of crimes, but the common thread is any situation of exploitation where a person cannot refuse or leave because of threats, violence, coercion, abuse of power or deception.

The term 'modern slavery' is used to refer to human trafficking, slavery and slavery like practices such as servitude, forced labour, deceptive recruiting and debt bondage.

These crimes are often the most exploitative and grievous circumstances of abuse, but it is important to recognise that they are often accompanied by other human rights abuses and poor labour standards, hidden behind systemic corruption and bribery.

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For more information about the Inquiry, see the News/Blogs page.  The most recent blog can be found here.

Submissions to the Inquiry Were due on Friday 28 April, 2017

On 15 February 2017, the Attorney-General, Senator the Hon George Brandis QC, asked the Joint Standing Committee on Foreign Affairs, Defence and Trade ('the Committee') of the Parliament of Australia to inquire into and report on establishing a Modern Slavery Act in Australia.

The Committee shall examine whether Australia should adopt a Modern Slavery Act. The Committee shall have particular regard to:

  • The nature and extent of modern slavery (including slavery, forced labour and wage exploitation, involuntary servitude, debt bondage, human trafficking, forced marriage and other slavery-like exploitation) both in Australia and globally;
  • The prevalence of modern slavery in the domestic and global supply chains of companies, businesses and organisations operating in Australia;
  • Identifying international best practice employed by governments, companies, businesses and organisations to prevent modern slavery in domestic and global supply chains, with a view to strengthening Australian legislation;
  • The implications for Australia’s visa regime, and conformity with the Palermo Protocol to Prevent, Suppress and Punish Trafficking in Persons, Especially Women and Children regarding federal compensation for victims of modern slavery;
  • Provisions in the United Kingdom’s legislation (the Modern Slavery Act 2015) which have proven effective in addressing modern slavery, and whether similar or improved measures should be introduced in Australia; and
  • Whether a Modern Slavery Act should be introduced in Australia

For further information, please see this press release.

Interested persons and organisations are invited to make online submissions addressing the terms of reference by Friday, 28 April 2017. Further guidance on how to make a submission is available here


where can i learn more?

  • Webinar, 30 March, 9:30 am–11:00 am AEDT (Sydney time): STOP THE TRAFFIK is organising two video conferences to resource individuals and groups planning to make submissions to the Australian Government to advocate adopting a national legislation to combat modern day slavery.
  • Event — London, 30 March, 17:00–20:00 BST (London time): Law Society, The Business & Human Rights Resource Centre, and Ergon Associates will co-host an interactive workshop and networking event on the Modern Slavery Act 2015 (UK), designed to develop best practice and knowledge sharing among those involved in the day-to-day application of the Modern Slavery Act.
  • Event — Sydney, 6 April, 2:00–5:00 pm AEDT (Sydney time): The Global Compact Network Australia's Modern Slavery Forum will build businesses’ capacity to engage in the discussion around the possibility of an Australian Modern Slavery Act, and to respond to their modern slavery risks, and build networks with relevant stakeholders. Participants at this multi-stakeholder event will hear from unions, government representatives and companies across sectors. 
  • Event — Sydney, 11 May, 6:00 pm–8:00 pm AEST (Sydney time): The Freedom Partnership to End Modern Slavery, Thomson Reuters and DLA Piper Australia joint event 'A Modern Slavery Act for Australia — What's the Impact on Your Business?' will provide an introduction to the implications and potential impact of supply chain transparency legislation such as a Modern Slavery Act.
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  Credit:  Matt Stewart

Credit: Matt Stewart

points to raise in your submission

1.    Terms of Reference of the Inquiry

With reference to the United Kingdom’s Modern Slavery Act 2015 and to relevant findings from the Joint Standing Committee on Foreign Affairs, Defence and Trade’s report, Trading Lives: Modern Day Human Trafficking, the Committee shall examine whether Australia should adopt a comparable Modern Slavery Act. The Committee shall have particular regard to:

  • The nature and extent of modern slavery (including slavery, forced labour and wage exploitation, involuntary servitude, debt bondage, human trafficking, forced marriage and other slavery-like exploitation) both in Australia and globally;
  • The prevalence of modern slavery in the domestic and global supply chains of companies, businesses and organisations operating in Australia;
  • Identifying international best practice employed by governments, companies, businesses and organisations to prevent modern slavery in domestic and global supply chains, with a view to strengthening Australian legislation;
  • The implications for Australia’s visa regime, and conformity with the Palermo Protocol to Prevent, Suppress and Punish Trafficking in Persons, Especially Women and Children regarding federal compensation for victims of modern slavery;
  • Provisions in the United Kingdom’s legislation which have proven effective in addressing modern slavery, and whether similar or improved measures should be introduced in Australia;
  • Whether a Modern Slavery Act should be introduced in Australia; and
  • Any other related matters.

See: http://www.aph.gov.au/Parliamentary_Business/Committees/Joint/Foreign_Affairs_Defence_and_Trade/ModernSlavery/Terms_of_Reference

2.    The Modern Slavery Act 2015 (UK)

The relevant provision of the Modern Slavery Act 2015 (UK) ('MSA') is s 54 on supply chain transparency.

Section 54 asks companies to publish an annual 'slavery and human trafficking statement', which would disclose the steps the company has taken during that year to ensure that slavery and human trafficking is not taking place in any of its supply chains or in any part of its own business. The statement must be approved by the board or its equivalent. Where a company has a website, it must publish the statement on its website. The UK Government set a threshold so that the law applies to any company with an annual turnover of £36 million. As a result, the Act applies to an estimated 12 000 UK companies.

The idea was to create ‘a race to top’ in terms of transparency, however, the UK NGOs CORE and Business and Human Rights Resource Centre found that most initial annual statements are little more than public relations exercises that do not disclose information as recommended by the law and the non-binding guidance. Indeed, the Government gave businesses significant flexibility as to what to disclose.

Here are some of the concerns that have been raised regarding s 54 and possible responses:

  • Wholly owned subsidiaries of UK corporations are outside the scope of the law which means as long as the goods or services are not coming into the UK, they are exempt from this requirement. We need to ensure that the Australian legislation applies extra-territorially.
  • The UK Government set an annual turnover of £36 million to be covered. We need to set a lower threshold but ensure that small businesses not engaged in international trade are not caught up.
  • The law provides for no mandatory disclosures and the guidelines which accompany the UK MSA are also not binding. Further, the law does not even refer to information about companies’ remediation processes where negative impacts have taken place and the company has caused or contributed to them. We need to ensure our legislation requires disclosure and there are clear regulations regarding the disclosure items.
  • The MSA does not establish a central repository to which these statements must be uploaded. For the purposes of accountability, it is important that these are placed in one place. Otherwise, massive amounts of resources will have to be expended to collate the information. We must demand there be a central (government) repository where these statements appear.  There are a number of different options here: ASIC, DFAT or another government website. A repository hosted by government implies oversight and some level of accountability.
  • There is a lack of penalties for businesses which fail to comply with the UK MSA supply chain provisions. Companies that ignore the requirement will technically be breaking the law, but they do so without risk of any consequence. We must ensure that our legislation includes penalties for failure to issue a statement, issuing a fraudulent statement and lack of appropriate policy on forced labour and human trafficking. Australia’s Illegal Logging Prohibition Act 2012 (Cth) is relevant here. This Act incorporates due diligence requirements which obligate the importers and processors of timber to initiate verification and certification processes in order to ensure the imported timber was not illegally logged.[1] If an importer or processor intentionally, knowingly or recklessly imports or processes illegally logged timber they could face significant penalties, including up to five years imprisonment and/or heavy fines.
  • There is only a suggestion that the statement include information about a company’s due diligence processes but does not require a company to have a due diligence policy or to carry out effective human rights due diligence along the lines indicated by the UN Guiding Principles on Business and Human Rights and related guidance. Our legislation should go beyond transparency to mandate that companies conduct human rights due diligence in their supply chains regarding forced labour/human trafficking. The newly adopted French legislation the French corporate duty of vigilance (devoir de vigilance des sociétés mères et des entreprises donneuses d’ordre) law  establishes a legally binding obligation for parent companies to identify and prevent adverse human rights and environmental impacts resulting from their own activities, from activities of companies they control, and from activities of their subcontractors and suppliers, with whom they have an established commercial relationship.
  • We should consider a mix of voluntary and mandatory measures in the Act, ie similar to framework re Australian homeworkers legislation — allow companies to utilise unions and CSOs to feed into mapping/due diligence exercise.

In summary:

Submissions due by 28 April

To lodge a submission visit: http://www.aph.gov.au/Parliamentary_Business/Committees/OnlineSubmission.

Further reading

See current submissions here.

International Trade Union Confederation, Closing the Loopholes: How Legislators Can Build on the UK’s Modern Slavery Act (2 February 2017).

Business & Human Rights Resource Centre, Inquiry into the Establishment of a Modern Slavery Act in Australia.

Justine Nolan, ‘The Challenge of Putting Principles in Practice and Regulating Global Supply Chains’ (2017) 42 Alternative Law Journal (forthcoming — contact the author at justine.nolan@unsw.edu.au to request a copy).

Ryan Turner, ‘Transnational Supply Chain Regulation: Extraterritorial Regulation As Corporate Law’s New Frontier’ (2016) 17 Melbourne Journal of International Law 188.

Endnotes

[1]  The Illegal Logging Prohibition Amendment Regulation 2013 requires that importers and processors undertake due diligence processes from 30 November 2014. There is an 18 month transition period during which the Australian government will seek to assist and educate companies about the due diligence requirements. Section 7 sets out the four step due diligence process. Step 1 is information gathering (the importer must obtain as much of the prescribed information as is reasonably practicable); Step 2 is an option process that involves assessing and identifying risk against a prescribed timber legality framework (section 11) or a country specific guideline (once they are prescribed); Step 3 is risk assessment (s 13); and Step 4 is risk mitigation (s 14) which should be adequate and proportionate to the identified risk. Illegally logged timber is defined broadly in the Illegal Logging Prohibition Act 2012 (Cth) as timber ‘harvested in contravention of laws in force in the place (whether or not in Australia) where the timber was harvested’ (s 7).

[2] See, eg, Industrial Relations (Ethical Clothing Trade) Act 2001 (NSW) and Workers Compensation Act 1987 (NSW) s 175B; Industrial Relations (Fair Work) Act 2005 (SA); Outworkers (Improved Protection) Act 2003 (Vic); and Industrial Relations and Other Acts Amendment Act 2005 (Qld). See generally, Igor Nossar, Richard Johnstone and Michael Quinlan, ‘Regulating Supply Chains to Address the Occupational Health and Safety Problems Associated with Precarious Employment: The Case of Home-Based Clothing Workers in Australia’ (2004) 17 Australian Journal of Labour Law 137. The Australian legislation is supplemented by a voluntary mechanism administered by a multi-stakeholder initiative — Ethical Clothing Australia — that accredits businesses operating in this specific sector and assists companies with the process of mapping their supply chain and verifying that all workers within it are receiving their legal entitlements.