By Luke Geary, Partner, Georgia Davis, Associate and Hannah Hall, Lawyer
On Friday, 19 November 2021, the NSW Parliament finally voted in favour of long awaited amendments to the as yet, uncommenced Modern Slavery Act 2018 (NSW) (the Principal NSW Act). It is important to note that the NSW passed law is separate and distinct from the Commonwealth Modern Slavery Act 2018 (Cth) (the Commonwealth MSA), which has been in force since 1 January 2019.
The Modern Slavery Amendment Act 2021 (NSW) (the New Act), which will come into force on 1 January 2022, introduces a number of amendments to the Principal NSW Act and, as such, impacts the Modern Slavery movement more generally. A copy of the Bill may be accessed here.
For context, Modern Slavery is defined in the Principal NSW Act as any conduct constituting a modern slavery offence, as well as any conduct involving the use of any form of slavery, servitude or forced labour to exploit children or other persons taking place in the supply chains of government agencies or non-government agencies. On the NSW Government website, examples include a worker on a farm who is unable to leave or stop working because of threats from his employer, or a teenager who is overseas on a family holiday and forced or coerced into marriage.
The New Act provides a suite of new protections designed to safeguard people vulnerable to slavery, including:
- Additional support for survivors, specifically, financial support or recognition payments under the Victims Rights and Support Act 2013 (NSW) to be made to certain victims of acts of modern slavery;
- Further information with respect to the functions, reporting and cooperation requirements of the Anti-Slavery Commissioner; and
- Provisions concerning the online sexual exploitation of children.
The New Act also amends the definition of “government agency” in section 5 of the Principal NSW Act, to exclude State-owned corporations and Corporations Act companies that have a shareholding Minister. The definition of “government agency” now includes local councils also. In the same section, “organisation” has been inserted and defined as including a “government agency” and a “commercial organisation”.
Perhaps controversially, in order to remove certain regulatory burdens on NSW businesses, the New Act repeals the supply chain transparency provisions of the Principal NSW Act, which was originally passed to require commercial organisations with a consolidated revenue of $50 million or more to prepare modern slavery statements, detailing their due diligence processes against modern slavery in their supply chains. The practical effect of this is that from 1 January 2022, non-government entities operating in NSW will only be required to report under the Commonwealth MSA to the extent that those entities meet the reporting threshold under the Commonwealth MSA, which is currently consolidated revenue during an annual reporting period of more than $100 million. As such, the previous penalties for non-compliance with the Principal NSW Act are no longer applicable. In support of this amendment, in the Second Reading Speech of the Bill, the Hon. Don Harwin commented that there is little public benefit in implementing a New South Wales scheme that largely duplicates and overlaps the Commonwealth’s scheme—only more red tape for business.
For State-owned corporations, amendments instituted by the New Act require that modern slavery statements must be made if not already required under the Commonwealth MSA and be published on an openly-accessible website kept by the corporation, with written notice provided to the NSW Anti-Slavery Commissioner of the same. Commercial and non-profit organisations in NSW, which do not meet the threshold of consolidated revenue of $100 million, can still voluntarily report under the Commonwealth’s regime and will be encouraged by the NSW Anti-Slavery Commissioner to do so.
The New Act in conjunction with the Principal Act adds to the weight of the Commonwealth MSA insofar as obligations for government agencies (all the way through to local councils) are concerned. These obligations include peering into their own supply chains. If your organisation does any work with any government agencies, or has any major clients or suppliers who do, then over the coming period you will likely see the impact of these new laws trickle through to your business. The market pressure will mean you will see increasing requests to demonstrate what you are doing in this area, to satisfy the government agencies subject to these new laws that doing business with you doesn’t increase their own risks of modern slavery. An effective route for ensuring you’re prepared for these new pressures is to voluntarily report under the Commonwealth MSA if you are not already a reporting entity and to take steps now to lay the foundations for that report. It wouldn’t surprise us if this ultimately becomes a ‘weighting criteria’ for government tenders when assessing competitive bids.
We would be pleased to discuss any questions that you may have with respect to the New Act or modern slavery questions more generally.
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