Written by Edwina Kwan and Lucy Forbes
On 29 November 2021, the NSW Parliament passed amendments to the Modern Slavery Act 2018 (NSW) (NSW Act).
The amendments address concerns that the NSW Act was inconsistent with, or duplicates, the obligations in the Federal Modern Slavery Act, as well as clarifying the role of the Anti-slavery Commissioner and strengthening slavery offences.
The amended NSW Act will commence on 1 January 2022.
What amendments have been made to the NSW Act?
In summary, the 2021 amendments introduced the following changes to the NSW Act:
- removing reporting requirements in the NSW Act which duplicate and overlap with the Commonwealth scheme;
- clarification that provisions in the Act relating to the Anti-slavery Commissioner’s oversight of public procurement do not apply to State-owned companies, Corporations Act companies that have a shareholding Minister or non-government agencies. The Amendment Bill further clarifies that local governments, while “government agencies” for the purpose of the Act, are not subject to the Auditor-General's audit functions in relation to modern slavery;
- further provisions regarding cooperation between the Anti-slavery Commissioner and relevant agencies on criminal / child protection matters, as well as information sharing between the Commissioner of Police and the anti-slavery Commissioner;
- clarification that no criminal or civil liability (including for breach of confidentiality) attaches to a person for good-faith compliance with the NSW Act or for providing information to the Commissioner;
- removing provisions regarding modern slavery risk orders, which would have allowed courts wide discretion to prohibit modern slavery offenders from contacting their victims or taking other actions;
- inserting a provision for reviewing the Act twelve months after its commencement; and
- amending other legislation relating to defamation, victims’ rights and support, child abuse material and child forced marriage.
What does my business need to consider?
No additional reporting requirements
The most notable change in the Amendment Bill is the removal of all modern slavery reporting requirements independent from the Federal regime. If your business has annual turnover of A$100M or more and is currently reporting under the Commonwealth Modern Slavery Act 2018, you will not have to submit a separate statement under the NSW Act.
If your company has annual turnover of between A$50M and A$100M, you are still not required to submit a modern slavery statement in Australia. However, the NSW Government has indicated that the Anti-slavery Commissioner will actively advocate for voluntary reporting by NSW businesses with an annual turnover between A$50 million and A$100 million.
Changes to the federal reporting threshold unlikely
Minister Don Harwin stated that any changes to the Commonwealth reporting threshold in 2022 are, on the basis of his discussions with the Commonwealth government, unlikely:
I should note that the New South Wales Government has urged the Commonwealth to revisit the reporting threshold, with the New South Wales Government's express preference of harmonising the threshold at $50 million. […] In a subsequent meeting of 9 March 2021, the Minister advised me that changes to the reporting threshold were unlikely ahead of a statutory review to commence in 2022 but that issue would likely be canvassed in the review.
Stricter obligations on government agencies
Businesses tendering or supplying to government agencies should be aware that these bodies will be required to consider modern slavery in the procurement process. Suppliers should therefore be prepared to demonstrate that they have conducted reasonable enquiries into their supply chains, identify any modern slavery risks and describe how they are / will address these risks in supplying the agency.
Modern slavery risk management for SMEs
Minister Don Harwin noted that the Anti-slavery Commissioner will still assist small and medium-sized enterprises to identify modern slavery within their supply chains and to assist them in remediating and monitoring identified risks.
Increased awareness of modern slavery across the supply chain
The effect of the federal modern slavery reporting legislation has been that large corporations operating in Australia are developing increasingly sophisticated assessment and management frameworks to mitigate modern slavery risks in their operations and supply chains. This shift in risk management has begun to trickle down to smaller companies that may not be caught by the reporting requirements: they are likely to receive requests for information about their own modern slavery risks and actions from larger counterparties, investors and banks. The NSW Anti-slavery Commissioner is likely to play a role in supporting smaller businesses to respond to these kinds of requests and encouraging voluntary reporting.