Australia: Food for thought: the Modern Slavery Act impacts on fresh food retail, wholesale and agriculture industries

Last Updated: 21 October 2017
Article by Abigail McGregor and Greg Vickery

Introduction

The Australian food retail, wholesale and agriculture industries are no strangers to reports of poor treatment of migrant workers on Australian farms, often involving labour hire companies.1Due to the nature of the work involved in the production, processing, packaging and transport of food and produce, these supply chains have a high risk of modern slavery.2

While the major supermarkets already have anti-slavery programs in place, other businesses operating in the food and agriculture industries, including producers, distributors, packers, exporters and caterers, may not be fully prepared for the introduction of a new corporate reporting requirement.

A taste of modern slavery risk...

  • Engagement of labour hire contractors who recruit backpackers and seasonal workers for fruit and vegetable picking on farms, without express obligations concerning ethical recruitment and retention of labourers.3
  • Poor conditions, passport retention and bonded labour in food processing.4
  • Procurement of high risk foods across maritime borders, particularly from emerging economies, such as crustacea, corn, palm oil, poultry, rice, sesame, wheat, sugarcane, cattle, beans, coffee and cocoa beans, seafood, nuts and tea, including forced labour risks involved in shipping, and transport of these products.5
image1

On 16 August 2017, the Minister for Justice Michael Keenan announced that the Federal Government proposes to introduce legislation to require large businesses to report annually on their actions to address modern slavery. This announcement reinforces Australia's commitment to having one of the strongest responses to modern slavery in the world. We have been actively participating in the Attorney-General's Department national consultation process to refine the Government's proposed Modern Slavery in Supply Chains Reporting model.

It is currently proposed that businesses with revenue of AU$100m+ will be required to report annually on their efforts to identify and stop modern slavery in their operations and supply chains. There is no doubt that many businesses in the food retail, wholesale and agriculture industries will face intense public scrutiny, especially given the high risk of modern slavery in the sector.

In this update, we look at modern slavery risks in the food and agriculture sectors, the likely implications of a new reporting requirement for Australian businesses that operate in that sector and what they can do to prepare.

What is modern slavery?

At its broadest, the term 'modern slavery' incorporates any situations of exploitation where a person cannot refuse or leave work because of threats, violence, coercion, abuse of power or deception. It includes slavery, servitude, forced labour, debt bondage, and deceptive recruiting for labour or services.

The Australian Government proposes that for the purpose of the reporting requirement, modern slavery will be defined to incorporate conduct that would constitute a relevant offence under existing human trafficking, slavery and slavery-like offence provisions set out in divisions 270 and 271 of the Commonwealth Criminal Code. However, the exact scope of "Modern Slavery" is the subject of consultation and it remains unclear whether the definition of Modern Slavery will go beyond the Criminal Code offences.

image1

Recent Industry Examples

  • Enslavement on Thai fishing vessels to assist in producing seafood sold across the world, including to Australia.6
  • Immigrant labourers on farms being routinely abused.7
  • Employers withholding wages or forcing staff to work at rates lower than those previously agreed.
  • Labour agents confiscating the passports of migrant workers, often with little grasp of English, forcing them to work and live in squalid conditions.
  • Recruitment fees payable by employees from future wages.8

How will a Modern Slavery Act affect food and agriculture businesses?

Given the bipartisan support for a Modern Slavery Act, Australia is likely to have a reporting requirement relating to modern slavery that could be in place as early as 2018. The likelihood is that the new Australian regime will be similar in many respects to the UK regime.

The current proposal would require businesses to address the following matters in their statements:

  1. the entity's structure, its operations and its supply chains;
  2. the modern slavery risks present in the entity's operations and supply chains;
  3. the entity's policies and processes to address modern slavery in its operations and supply chains and their effectiveness (such as codes of conduct, supplier contract terms and training for staff); and
  4. the entity's due diligence processes relating to modern slavery in its operations and supply chains and their effectiveness.

The Joint Standing Committee on Foreign Affairs, Defence and Trade, which is responsible for the ongoing Inquiry into establishing a Modern Slavery Act in Australia, has given its in principle support for the Australian Government to publish a list of businesses obliged to report and a list of businesses that fail to report. A publicly accessible central repository for published statements is also proposed.

Australian businesses ought to expect that there will be significant public criticism of those businesses that do not comply with their reporting obligations and that statements, once published, will be subject to intense public scrutiny, as has been the case in the UK.

The existence of a central repository of statements will facilitate the monitoring and review of statements. It is also likely to assist businesses, consumers and other stakeholders to understand the steps being taken by businesses to eradicate modern slavery in their operations and supply chains and take more effective steps to address the underlying issues.

What is the industry doing already?

As highlighted above, the food and agriculture industries are no strangers to the risk of modern slavery. While the Federal Government and regulators have taken action in investigating allegations of abuse of vulnerable migrant workers on farms, industry participants have taken some steps towards addressing these risks, with varying results, including:

  • Adoption of the UN Guiding Principles on Business and Human Rights Reporting Framework and membership to the UN Global Compact.
  • Establishing a national labour hire certification scheme with training programs for employers in horticulture and pack houses eg the Fair Farms Initiative.
  • Sourcing products that come with ethical certification eg UTZ certification, and Fair Trade.
  • Participation and membership of data-sharing organisations to audit suppliers such as the Suppliers Ethical Data Exchange.

In the meantime, civil society groups and other organisations have created their own public databases to rate businesses' compliance with human rights and sustainability standards, including:

  • Oxfam's Behind the Brands Campaign.
  • KnowtheChain's benchmark on food and beverage companies.
  • Corporate Human Rights Benchmark which assesses 98 of the largest publicly traded companies in the world on 100 human rights indicators.
  • Apps like "Shop Ethical!" which provide information on the environmental and social record of companies behind common Australian supermarket brands.
  • Dow Jones Sustainability Index – a globally recognised independent benchmark that measures the performance of the world's largest 2500 companies.

Unfavourable listings in such databases and indices can have negative reputational effects.

What can food and agriculture businesses do to prepare?

In light of the high risk of modern slavery occurring in food and agriculture businesses and supply chains, many companies are already in the process of reviewing their operations and supply chains and implementing measures to identify and address incidents of modern slavery.

Those businesses that haven't already done so should consider taking the following steps:

  1. Mapping the organisation's structure, businesses and supply chains.
  2. Formulating policies in relation to modern slavery – this will involve collating current policies, identifying gaps, adapting existing policies and formulating new policies, as needed.
  3. Carrying out a risk assessment – identifying those parts of the business operations and supply chains where there is a risk of modern slavery taking place.
  4. Assessing and managing identified risks – this may include carrying out further due diligence in the entity's operations and supply chains and reviewing and adapting contract terms and codes of conduct with suppliers.
  5. Considering and establishing processes and KPIs to monitor the effectiveness of the steps taken to ensure that modern slavery is not taking place in the business or supply chains.
  6. Carrying out remedial steps where modern slavery is identified.
  7. Developing training for staff on modern slavery risks and impacts.

Businesses operating in the food and agriculture industries need to be particularly alive to the risk of slavery occurring deep in their supply chains, which are often long and complex. Well publicised incidents mean that businesses operating in these sectors are likely to be treated as being "on notice" of these risks and the government, media and public will closely monitor the steps they are taking to operate sustainably and ethically.

By undertaking these steps, businesses will be well placed to respond effectively to new regulations and show that they are committed to eradicating modern slavery, in Australia and overseas, and taking concrete steps to achieve that outcome. For more detail on what business can do now, see our article on human rights due diligence in supply chains

Footnotes

1 Parliament of Victoria, Economic Development Committee, Inquiry into Labour Hire Employment in Victoria, Interim Report December 2004 and Final Report, June 2005, and Victorian Government Department of Economic Development, Jobs, Transport & Resources Victorian Inquiry into the Labour Hire Industry and Insecure Work: Final Report 31 August 2016 http://economicdevelopment.vic.gov.au/data/assets/pdf_file/0016/1390111/IRV-Inquiry-Final-Report-.pdf; Parliament of Australia, Senate Education and Employment References Committee, A National Disgrace: The Exploitation of Temporary Work Visa Holders (17 March 2016); Parliament of Australia, House of Representatives Standing Committee on Employment, Workplace Relations and Workforce Participation Committee, Making it work: Inquiry into independent contracting and labour hire arrangements (Canberra, August 2005); Australian Government, Fair Work Ombudsman, A report on the Fair Work Ombudsman's Inquiry into the labour procurement arrangements of the Baiada Group in New South Wales June 2015.

2 Findings of the Trafficking in Persons Report suggest that while traditionally the majority of human trafficking and slavery investigated in Australia have related to women subjected to sexual exploitation, there has been an increase in the number of referrals and investigations relating to other forms of labour exploitation especially in the agriculture, construction, hospitality and domestic services industry – and is now comparable with those subjected to sexual exploitation. See Australian Government "Trafficking in persons: the Australian Government Response 1 July 2015 – 30 June 2016" The Eighth Report of the Interdepartmental Committee on human trafficking and slavery (2016) p 23 https://www.ag.gov.au/CrimeAndCorruption/HumanTrafficking/Documents/Report-of-the-interdepartmental-committee-on-human-trafficking-and-slavery-july-2015-to-June-2016.pdf

3 Kallee Buchanan "Backpacker farm labour 'modern day slavery'" 19 July 2017, AM, ABC Radio, recording available online: http://www.abc.net.au/news/2017-07-19/backpacker-farm-labour-modern-day-slavery/8722320

4 Caro Meldrum-Hanna and Ali Russell "Slaving Away" ABC Four Corners (6 May 2015) http://www.abc.net.au/4corners/stories/2015/05/04/4227055.htm

5 See further Business & Human Rights Resource Centre An introduction and commentary to the 2011 UN Guiding Principles on Business and Human Rights and their implementation in the maritime environment 2016 available online: https://www.humanrightsatsea.org/wp-content/uploads/2015/05/HRAS-UNGP-Report-2016-low-res-dps.pdf

6 https://www.humanrightsatsea.org/wp-content/uploads/2015/05/HRAS-UNGP-Report-2016-low-res-dps.pdf

7 Caro Meldrum-Hanna and Ali Russell "Slaving Away" ABC Four Corners (6 May 2015) http://www.abc.net.au/4corners/stories/2015/05/04/4227055.htm

8 Fair Work Ombudsman, "Growers, hostels, labour-hire contractors cautioned over backpacker, seasonal worker entitlements" 5 January 2015 https://www.fairwork.gov.au/about-us/news-and-media-releases/2015-media-releases/january-2015/20150105-dont-get-ripped-off-this-harvest-season

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Abigail McGregor
Similar Articles
Relevancy Powered by MondaqAI
KordaMentha
Norton Rose Fulbright Australia
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
KordaMentha
Norton Rose Fulbright Australia
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions