Australia: Modern slavery laws – Impacts for the NSW Government

Last Updated: 28 September 2018
Article by Scott Alden, Victoria Gordon and Lauren Stables
Most Read Contributor in Australia, September 2018

New South Wales is the first jurisdiction to enact modern slavery legislation in Australia, with the Modern Slavery Act 2018 (NSW) (NSW Act) passing through Parliament on 21 June 2018. The NSW Act contains some key differences to the proposed Commonwealth Modern Slavery Bill 2018 (Cth) (Commonwealth Bill) which was introduced into Federal Parliament on 28 June 2018 and is expected to pass Parliament later this year.

Both the NSW Act and the Commonwealth Bill introduce reporting requirements for certain commercial entities that are aimed at increasing transparency in commercial supply chains to combat modern slavery 1.

However, the NSW Act and the Commonwealth Bill differ in their approach to government entities.

This article will look at the direct impacts of the NSW Act on NSW government procuring agencies which, for the purposes of the NSW Act include:

  • a NSW Government agency
  • a State owned corporation
  • a Corporations Act 2001 (Cth) company under which one or more shareholders are a minister of the Crown
  • a council, county council or joint organisation within the meaning of the Local Government Act 1993 (NSW) 2.

Overview of the NSW Act and the Commonwealth Bill

Under the NSW Act, a "commercial organisation" with an annual turnover of $50 million or more must prepare a modern slavery statement (Statement) each financial year 3.

The Statement must contain such information as required by the Regulations and be published publicly within the time frame stipulated by the Regulations (likely to be within five months of the end of the financial year). The Regulations have not yet been enacted, however will likely require an organisation to include the following information in its Statement:

  • the organisation's structure, its business and its supply chains
  • due diligence processes in relation to modern slavery in its business and supply chains
  • the parts of its business and supply chains where there is a risk of modern slavery taking place, and the steps it has taken to assess and manage that risk
  • the training about modern slavery available to its employees.

Large penalties of up to $1.1 million apply for failing to prepare or publish a Statement, or for providing false or misleading information in connection with a Statement. Statements will be published on a public register which will be kept by the Anti-slavery Commissioner (Commissioner).

For the purposes of the NSW Act, a NSW government agency is not a commercial organisation and is therefore not required to prepare a Statement. However, as set out below, the obligations on NSW government agencies, while different, end up having a very similar effect to commercial organisations.

In comparison, the Commonwealth Bill applies to Australian organisations with a revenue over $100 million per financial year which includes the Commonwealth and Commonwealth entities or companies 4. Similar to the NSW Act, those qualifying organisations must prepare a modern slavery statement (within six months of the end of the financial year) which is to be maintained on an online public register by the Minister of Home Affairs. The Commonwealth Bill contains some additional requirements regarding the content of the modern slavery statements, including the effectiveness of actions taken by the reporting entity, and the consultation process with other entities the reporting entity owns or controls.

Both the NSW Act and Commonwealth Bill contain "opt in" provisions allowing organisations who do not meet the thresholds to voluntarily submit modern slavery statements.

A key difference between the two regimes is the penalties for non-compliance, with the Commonwealth Bill currently not prescribing any penalties for non-compliance, compared with the potential $1.1million fine for non-compliance under the NSW Act.

The NSW Act and government procuring agencies

As noted above, NSW government agencies are exempt from preparing Statements under the NSW Act, as compared to the Commonwealth and Commonwealth entities under the Commonwealth Bill.

Instead, the NSW Act applies separately to government agencies5 and creates separate mechanisms to ensure the procurement of goods and services by the NSW Government are not the product of modern slavery. To this end, the NSW Act requires the Commissioner to regularly consult with the Auditor-General and the NSW Procurement Board to monitor the effectiveness of due diligence procedures to ensure goods and services are not the product of modern slavery. There is little guidance in the NSW Act regarding what regular consultation may entail or how the effectiveness of due diligence procedures may be monitored or measured.

The NSW Act also amends a number of other NSW Acts and Regulations to ensure goods and services procured by and for government agencies are not the product of modern slavery, including:

  • new provisions under the Public Works and Procurement Act 1912 (NSW) which allow the Auditor-General to conduct a modern slavery audit of a government agency to determine if reasonable steps have been taken by the agency to ensure goods and services are not the product of modern slavery
  • new provisions under the Public Finance and Audit Act 1983 (NSW) which allow the Auditor-General to conduct a risk-based audit to assess whether goods and services procured by government agencies are the product of modern slavery
  • new provisions under the Annual Reports (Departments) Regulation 2015 and Annual Reports (Statutory Bodies) Regulation 2015, requiring the annual report of a NSW Government Department or Statutory Body to include:
    • a statement of action taken in relation to any issue raised by the Commissioner in the previous year
    • a statement of steps taken to ensure the goods and services procured were not the product of modern slavery.

The Commissioner must also publish on the public register any government agency failing to comply with directions of the NSW Procurement Board concerning procurement of goods and services that are the product of modern slavery and whether the government agency has taken steps to ensure compliance in the future.

Further, the Commissioner may also develop publicly available codes of practice that promote public awareness and assist government agencies to identify, monitor and remediate modern slavery in their supply chains.

Conclusion and next steps

Both the NSW Act and Commonwealth Bill impose reporting requirements on commercial entities aimed at exposing the prevalence of modern slavery in supply chains and allow the Australian business community to take proactive and effective actions to address modern slavery.

While there are many similarities between the two legislative regimes, the different approach to government entities is a key point of difference and NSW government agencies need to be aware of their obligations in this regard.

What NSW government agencies should begin turning their mind to now is:

  • what sectors are they involved in and buy from
  • which of those sectors are high risk in relation to modern slavery 6
  • which entities that they do business with are above or below $50 million and, where they are less than $50 million, whether any are opting in to the legislation
  • changes to the procurement documentation, in particular Tender Returnable Schedules in relation to Supply Chains, Modern Slavery Statement, modern slavery compliance, modern slavery policies and training
  • changes to commercial and construction contracts regarding modern slavery compliance, assistance with audits, proactive disclosure of identified issues or fines, and specific indemnities regarding loss or damages arising from breaches, including loss of reputation (normally excluded as consequential loss).

Footnotes

1 Modern slavery is defined in the NSW Act as committing, attempting to commit or inciting a range of offences in the Crimes Act 1900, the Human Tissue Act 1983 and the Commonwealth Criminal Code. The offences include slavery, servitude, forced labour, human trafficking, debt bondage and offences relating to child abuse. Modern slavery extends to any conduct involving any form of slavery, servitude or faced labour to exploit children or other persons taking place in the supply chains of government agencies or non-government agencies.

2 Government agency defined in section 5 of the NSW Act.

3 A commercial organisation means an organisation which has employees in NSW, supplies goods and services for profit or gain, has a total turnover in a financial year of the organisation of more than $50 million and is not a government agency (section 24(1) of the NSW Act).

4A reporting entity is defined under section 5 of the Bill as (a) an entity which has a consolidated revenue of at least $100 million for the reporting period, if the entity is an Australian entity at any time in that reporting period or carries on business in Australia at any time in that reporting period; (b) the Commonwealth; (c) a corporate Commonwealth entity, or a Commonwealth company, within the meaning of the Public Governance, Performance and Accountability Act 2013, which has a consolidated revenue of at least $100 million for the reporting period; and (d) an entity which has volunteered to comply with the requirements of this Act under section 6 for that period.

5 A government agency means any of the following: a government sector agency (within the meaning of the Government Sector Employment Act 2013), a NSW Government agency, a State owned corporation, a company incorporated under the Corporations Act 2001 of the Commonwealth of which one or more shareholders are a minister of the Crown, a council, county council or joint organisation within the meaning of the Local Government Act 1993, any other public or local authority that is constituted by or under an Act or that exercises public functions and any public or local authority that is constituted by an Act of another jurisdiction that exercises public functions.

6 According to the International Labour Office statistics (Global Estimates of Modern Slavery 2017) the highest risk sectors are domestic work 24 per cent, construction 18 per cent, manufacturing 15 per cent, agriculture, forestries and fishing 11 per cent, accommodation and food service 10 per cent, wholesale and trade nine per cent, mining and quarrying seven per cent.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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
Scott Alden
Lauren Stables
Similar Articles
Relevancy Powered by MondaqAI
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
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