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Modern slavery: Make a difference

Modern slavery: Make a difference

By Craig Evans and Georgia Whitten

Human Rights 

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Young lawyers can play an important role in ensuring effective regulation of the Modern Slavery Act.

Snapshot
  • The Modern Slavery Act relies on market-based regulation. 
  • Young lawyers can play a crucial role in addressing and minimising these human rights abuses by reading modern slavery statements, critically analysing corporate responses (while being conscious of the task faced by reporting entities) and taking appropriate action.
  • By following these steps, young lawyers can actively engage with this issue while assisting to ensure that reporting entities are effectively regulated by the market.

The Modern Slavery Act 2018 (Cth) (Act) has commenced in Australia, obliging large entities with a consolidated revenue exceeding $100 million to report on modern slavery risks in their supply chain and the steps taken to address those risks.

By engaging with the issue of modern slavery, young lawyers can play a crucial role in addressing and minimising these human rights abuses. This article explores three ways young lawyers can get involved to ensure that the Act is effectively enforced. 

Background

“Modern slavery” is an umbrella term used to describe slavery, human trafficking, forced labour and a range of other human rights abuses involving human exploitation.2 Sadly, modern slavery impacts every region of the world, including Australia.3 Not only do these practices occur on our shores,4 but Australian consumers and businesses could also be complicit in these crimes without realising it. In 2018, it was estimated that Australia imported $12 billion worth of products that were at risk of being affected by modern slavery.5 Laptops, mobile phones, fish, cocoa and sugarcane are among the highest risk products.6 In many cases, goods and services tainted by modern slavery become inter-mixed with other products and services, moving tier upon tier up the supply chain towards the consumer.7

After extensive public consultation, the federal government introduced the Act with the objective of equipping and enabling businesses to respond effectively to modern slavery and to develop and maintain responsible and transparent supply chains.

Now, more than ever, an awareness of modern slavery is crucial. COVID-19 has caused widespread unemployment and shut down popular migration pathways, leaving many vulnerable people stranded overseas. With increased isolation and reduced scrutiny of labour practices, COVID-19 has greatly increased the likelihood that vulnerable people will be exposed to exploitation.

By engaging with the issue of modern slavery, young lawyers can play a crucial role in addressing and ameliorating these human rights abuses. 

Three ways to help

While the Act has increased awareness of modern slavery and mandated that reporting entities consider the risks of modern slavery in their supply chains, the absence of punitive penalties for entities that fail to comply has led to claims the legislation is “toothless”.10 Instead of penalties, the Act relies on market-based regulation. That is, rather than enforcement action, consumers and investors are relied on to hold reporting entities to account. Accordingly, young lawyers have an important role to play in the effective regulation of reporting entities. This article considers ways to help. 

Read modern slavery statements

Young lawyers are encouraged to read Modern Slavery Statements (statements). A key feature of the Act is that all statements must be published on a publicly available central registry.11 It is hoped that increasing access to statements will increase accountability. This aspect of the Act improves on similar legislation in the UK and California which simply requires reporting entities to publish statements on their own websites. 

Although statements are published, it is not always easy to know what to look for. Reporting entities are required to address seven mandatory criteria in their statements. These include: the risks of modern slavery in the reporting entity’s supply chain, action taken to assess and address those risks, and the effectiveness of those actions.12 For young lawyers interested in this issue, it may be useful to read the Department of Home Affairs guidance note on reporting which provides a clear explanation of what reporting entities must do to comply with the Act.13

Critically analyse corporate responses

Beyond simply reading statements, young lawyers are encouraged to critically analyse corporate responses. In general, market-based disclosure is a weak regulatory tool which leads to poor compliance.14 International experience in the UK reveals that the quality of compliance with the Modern Slavery Act 2015 (UK) has been poor,15 with many entities simply disclosing information about their policies and processes without explaining the steps taken to address these risks.16 The likelihood of this happening in Australia may be reduced due to the mandatory reporting criteria in the Act, coupled with the Minister’s discretionary power to publish information on the registry about entities that fail to comply.17 Even so, young lawyers are encouraged to critically analyse statements, particularly the effectiveness of corporate responses to modern slavery, to ensure that reporting entities are actively engaging with this issue and improving year-on-year. 

However, it is important to understand the gravity and magnitude of the task that reporting entities face. First, the Act operates extra-territorially, extending to omissions, matters and things outside Australia.18 This presents a hurdle for reporting entities with offshore operations and supply chains. While Australian companies have a clear understanding of the problem and support the Act’s requirements, Baker McKenzie employment and industrial law partner Sean Selleck notes that there is some resistance when operations go offshore, where there is less understanding of the problem and little to no knowledge of the legislation and its genesis in Australia. As such, there are challenges in getting commitment from overseas offices and supply chains to do the work needing to be done to allow Australian businesses to do what they need to comply with the Act.

Second, some businesses have hundreds and, in some cases, thousands of first tier suppliers. There are usually many links – each with many more suppliers – in every one of those supply chains, before reaching source products and raw materials. This highlights the difficulty that entities face in reporting on their entire supply chains. Not only is it difficult to increase visibility overall, it is difficult to assess what is going on in remote supply chains when a corporation may be a number of contractual links away from the problem. 

So, while it is important to think critically about corporate responses to modern slavery, it is equally important for young lawyers to be aware of the complexities that reporting entities face and to understand that the process requires consistent improvement from reporting entities over time. 

Take action

Effective enforcement requires consumers and investors to take action. However, this does not always happen. Studies show that a consumer’s ethical and moral standards may be undermined by lower prices, convenience, product desirability and product functionality.19 While consumers may say they would boycott a product if they became aware of slavery being involved in its manufacturing, a positive stance towards ethical purchasing is not always a clear indicator of actual purchasing behaviour.20

Yet, taking action does not always mean boycotting products and brands. Effective action may include increasing your awareness of at risk products, becoming an ethical consumer, monitoring corporate responses to allegations of modern slavery, engaging with NGOs and community groups that are actively involved in this space or contacting corporations directly about their responses.

Conclusion

While modern slavery may feel like an issue that is too big to grapple with, there are ways young lawyers can engage with it. As a starting point, young lawyers can assist in the effective regulation of the Act by reading modern slavery statements and critically analysing corporate responses. Ultimately, young lawyers can take appropriate action by considering and even modifying their own purchasing behaviour. ■


Craig Evans is studying a Master of Laws (Juris Doctor) at Monash University. He is a member of the LIV YL Executive Committee and Law Reform Committee and co-lead of the Modern Slavery Working Group. Georgia Whitten is studying a Master of Laws (Juris Doctor) at The University of Melbourne. She is a member of the LIV YL Law Reform Committee and co-lead of the Modern Slavery Working Group.

  1. Modern Slavery Act 2018 (Cth) s3.
  2. Note 1 above, s4.
  3. See, generally, International Labour Office, Global Estimates of Modern Slavery: Forced Labour and Forced Marriage (Final Report, 19 September 2017).
  4. Samantha Lyneham, Christopher Dowling and Samantha Bricknell, “Estimating the Dark Figure of Human Trafficking and Slavery Victimisation in Australia”, Australian Government: Australian Institute of Criminology (Statistical Bulletin No 16, 15 February 2019), https://aic.gov.au/publications/sb/sb16.
  5. Walk Free Foundation, The Global Slavery Index, 2018 (Final Report, 2018) iv, 121. 
  6. Note 5 above, iv, vii, 103–4.
  7. Note 3 above, 10.
  8. Explanatory Memorandum, Modern Slavery Bill 2018 (Cth), 39.
  9. Walk Free Foundation, "Protecting People in a Pandemic" (Final Report, 2020).
  10. See, eg, Farrah Tomazin, “Slaves in the Supply Chain: New Laws Branded ‘Toothless’” (The Sydney Morning Herald online, 27 June 2018), https://www.smh.com.au/politics/federal/taking-on-slavery-with-toothless-laws-20180627-p4zo36.html.
  11. At the time of writing the Modern Slavery Statement Registry is not live <https://www.homeaffairs.gov.au/criminal-justice/Pages/modern-slavery.aspx>.
  12. Note 1 above, s16(1).
  13. Department of Home Affairs, “Commonwealth Modern Slavery Act 2018: Guidance for Reporting Entities” (October 2019).
  14. Robert Baldwin, Martin Cave and Martin Lodge, Understanding Regulation: Theory, Strategy and Best Practice, Oxford University Press, 2nd edn, 2012, pp119–21.
  15. Ergon Associates, “Modern Slavery Reporting: Is There Evidence of Progress?” (Report, October 2018).
  16. United Kingdom, Joint Committee on Human Rights, Human Rights and Business 2017: Promoting Responsibility and Ensuring Accountability (House of Lords Paper No 153, Session 2016–17) 38 [94].
  17. Note 1 above, s16A.
  18. Note 1 above, s10.
  19. See generally Timothy Devinney, Pat Auger and Giana Eckhardt, The Myth of the Ethical Consumer, Cambridge University Press, 2010.
  20. Marcia Narine, “Disclosing Disclosure Defects: Addressing Corporate Irresponsibility for Human Rights Impacts” (2015) 47(1) Columbia Human Rights Law Review 84, 134.

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