March 2021 modern slavery statement deadline approaching

Due to disruptions caused by the COVID-19 pandemic, the Australian Government has extended its deadline for certain reporting entities in Australia to comply with the Modern Slavery Act 2018’s modern slavery statement requirements.

Companies with reporting periods between 1 July 2019 and 30 June 2020 will now have until 31 March 2021 to file their modern slavery statements. Entities with reporting periods ending after 30 June 2020 will still need to file their modern slavery statements within six months after their respective reporting period ends. The Australian Border Force has published guidance to assist reporting entities with how to address COVID-19 impacts in modern slavery statements.

COVID-19 has made vulnerable workers even more susceptible to modern slavery conditions (defined as serious exploitation in the form of debt bondage, forced labour, human trafficking and slavery). Order cancellations, workforce reductions, changes in supply chain logistics and factory closures have all impacted workers’ lives. In rare instances, sudden order surges have also increased pressure on suppliers.

The Australian Border Force suggests that best-practice approaches should be adopted after consulting with stakeholders such as suppliers, workers, business peers, investors and civil society. Relevant key information may be obtained online from the Business and Human Rights Resource Centre, Ethical Trading Initiative, Fair Labor Association, Global Business Initiative on Human Rights, Institute for Human Rights and Business, International Labour Organization, International Organization for Migration and the United Nations Global Compact’s Decent Work Toolkit for Sustainable Procurement.

At a minimum, modern slavery statements that comply with the Modern Slavery Act must include the following information in respect of the reporting entity:

United Kingdom entities with their own modern slavery legislation requirements may be tempted to replicate their United Kingdom filings in Australia. However, the Australian legislation goes further than the United Kingdom legislation, requiring a description of supplier due diligence and remediation processes taken.

The Australian Border Force encourages reporting entities to maintain close supplier relationships by means of open communication, discussing with suppliers their worker protection measures vis-à-vis COVID-19 in the workplace as well as the pandemic’s impacts on demand and supply. The monitoring of supplier due diligence and remediation processes taken should be ongoing, although, once again, disruptions to regular due diligence processes should be acknowledged in the modern slavery statement.

The Australian Border Force has stated that remediation measures ‘should include ensuring workers continue to have access to grievance mechanisms, such as hotlines’. Outsourcing this hotline to a trusted third party service provider enforces the message that anonymity is guaranteed, calls are dealt with consistently using established protocols, and all data is securely encrypted and stored. 

One of the most effective tools for tackling modern slavery in the workplace (especially during the COVID-19 pandemic when due diligence procedures need to be modified in line with social-distancing requirements) is to ensure that robust hotlines are readily available for informants to whistleblowing wrongdoings anonymously at any time and with ease (for example, in a caller’s native language and 24/7).

Other elements of an effective whistleblowing programme include written follow-up procedures, a written commitment that there will be no retaliation for whistleblowing, and regular training for all members of the organisation, from the board down to new joiners.