Modern slavery risks during COVID-19 – what you need to know

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This article is written by Daisy Mallett and Daniel Fielding

The Australian Border Force has released guidance on how businesses can reduce the risk of vulnerable workers in their operations and supply chains becoming exposed to modern slavery during the coronavirus (COVID-19) pandemic (the Guidance).

The Guidance also explains how those businesses that are required to file modern slavery statements can address the impact of COVID-19 in their statements. If you are one of those businesses, you still need to file your modern slavery statement by the specified deadline even in light of the COVID-19 pandemic.

A link to the Guidance can be found here.   

How can COVID-19 increase modern slavery risks?

Mandatory lockdowns and the closure of international borders have resulted in factory shutdowns, cancellation of orders, workforce reductions and sudden changes to supply chain structures. These changes disproportionately affect vulnerable workers and increase their risk of exposure to modern slavery and other forms of labour exploitation due to:

  • loss of income or fear of loss of income;
  • low awareness of workplace rights;
  • requirements to work excessive overtime to cover capacity gaps;
  • increased demand due to supply chain shortages; and
  • the inability to safely return to home countries.

What can you do?

The Guidance encourages businesses to take steps to protect vulnerable workers in their global operations and supply chains from the impacts of COVID-19 by:

  • maintaining supplier relationships and fostering open communication with suppliers about COVID-19 risks;
  • collaborating with suppliers, workers, business peers, investors, and civil society to identify best-practice approaches to protect and support vulnerable workers; and
  • reviewing key international resources and implementing, where applicable, guidance to support fair work in supply chains.  

If you are changing your procurement arrangements during this time, you should be mindful of modern slavery risks in your procurement response to COVID-19. Changing suppliers may change your modern slavery risk profile.     

What does COVID-19 mean for filing your modern slavery statement?

For the majority of Australian businesses, your first modern slavery statements are still due no later than 30 September or 31 December 2020. The Guidance reinforces the need for businesses to continue to take steps to assess and address modern slavery risks during the COVID-19 pandemic and report on the actions taken in their modern slavery statements. COVID-19 highlights the importance of keeping track of the measures you are taking and auditing those measures in order to tell how effective those measures are in all business conditions.

Due to COVID-19, some businesses may be unable to provide detailed responses to some of the reporting criteria. This may be because businesses are unable to undertake planned activities to address modern slavery risks, have limited capacity to prepare statements, or have experienced significant changes to their supply chains. If any of those situations apply to your business, the Guidance encourages you to clearly explain in your modern slavery statement how COVID-19 has impacted your capacity to assess and address modern slavery risks during your reporting period.

How we can help

KWM can work with you to:

  • identify modern slavery risks in your supply chains;
  • develop internal anti-slavery policies and frameworks;
  • consider and amend your procurement agreements;
  • develop due diligence, culture and corporate governance guidelines;
  • conduct awareness seminars for boards, executives, legal and procurement teams; and
  • assist with preparing, drafting, or reviewing your modern slavery statements.
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