Labor’s recent federal election victory and new majority government clears a path for reforms to the Modern Slavery Act 2018 (Cth) (Act).
The previous Labor Government signalled a commitment to reforming the Act in its response to the independent statutory review of the Act in late 2024 (Government Response) (see our coverage here).
While that Labor Government delivered on the appointment of Australia’s first Federal Anti-Slavery Commissioner (Federal Commissioner), progress on the reform agenda has otherwise been slow.
In an address last month, the Federal Commissioner highlighted that the time is ripe for the Act to evolve beyond reporting.
Shifting beyond the uncertainty of a federal election, the Government is now well positioned to progress the reform agenda and its commitments in the Government Response. The agenda is clearly focussed on implementing a range of measures designed to strengthen Australia’s modern slavery response.
What did the Government commit to?
Key commitments made by the Federal Government in the Government Response are outlined in the table below.
The Government Response notes that initial efforts will focus on progressing consultations with relevant stakeholders, including the Federal Commissioner, with a priority on the introduction of a civil penalty regime. We expect to see progress on the topic of penalties in the year ahead.
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RECOMMENDATION
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GOVERNMENT RESPONSE
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GOVERNMENT COMMITMENT
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Recommendation 3: Definition of modern slavery in Guidance |
Agree |
Commitment to update Guidance The Attorney-General’s Department will review and update the Guidance for Reporting Entities (Guidance) to ensure the description of modern slavery in Appendix 1 aligns with the Criminal Code, taking into account stakeholder feedback received in the independent statutory review. |
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Recommendation 5: Tailored guidance for small and medium-sized entities |
Agree |
Commitment to updating Guidance The Attorney-General’s Department will amend the Guidance to provide tailored voluntary guidance in consultation with the Federal Commissioner and an optional reporting template for small and medium-sized entities. This Guidance will be helpful for smaller entities to prepare for mandatory reporting, should the revenue threshold be lowered in the coming years. |
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Recommendation 7: Reviewing the terms operations and supply chains |
Agree |
Commitment to review Guidance and consult with stakeholders The Government agrees to review how the terms ‘operations’ and ‘supply chains’ are explained in the Guidance to improve guidance for reporting entities, acknowledging sectoral differences and challenges in understanding downstream risk reporting obligations. This review will include consultation with stakeholders. |
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Recommendation 8: Amending the mandatory reporting criteria |
Agree in principle |
Commitment to consult with stakeholders The Government will undertake further consultation on proposed changes to the mandatory reporting criteria, recognising their potential impact on businesses and the need for clear, effective obligations. |
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Recommendation 11: Introducing obligations for a due diligence system |
Note |
Commitment to consult with stakeholders Although the Government did not adopt this recommendation, noting that the Act already requires reporting entities to comment on its due diligence processes, it committed to consultation with stakeholders on identifying how the Act could be amended to enhance its due diligence requirements in line with global developments and potential cross-jurisdictional obligations. This is expected to remain a live issue. |
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Recommendation 13: Developing an optional template |
Agree |
Commitment to implement The Government agrees to this recommendation and will develop an optional template to improve reporting quality and enhance comparability of modern slavery statements. |
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Recommendation 15: Introducing a mandatory coversheet |
Agree in principle |
Commitment to consult with stakeholders The Government agrees in principle to this recommendation and will consult with stakeholders on introducing a mandatory coversheet to assist reporting entities. The Government noted that the optional ‘Modern Slavery Statement Annexure’ is already available online to support reporting entities to demonstrate they have addressed all criteria. |
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Recommendation 16: Further guidance on approval and signature requirements |
Agree |
Commitment to updating Guidance The Government agrees to this recommendation and will explore how it may improve the clarity and accessibility of the Guidance and other existing resources on approval and signature requirements to support compliance. |
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Recommendation 17: Clarifying difficulties with joint reporting |
Agree |
Commitment to consult with stakeholders The Government agrees to this recommendation and will consult with reporting entities to clarify joint reporting processes and address concerns about transparency in complex corporate structures. |
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Recommendation 20: Introduction of penalties |
Agree in principle, in part |
Commitment to consult with stakeholders as a priority The Attorney-General’s Department will consult on the introduction and operation of civil penalties for:
In the Government Response, the Government stated that it would progress consultation on the introduction of penalties as a priority. This is intended to spur compliance with reporting requirements, rather than the quality of reporting. The Government merely noted the recommendation of penalties for failing to have a required due diligence system, pending the introduction of any obligations for a due diligence system (Recommendation 11). |
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Recommendation 25: Forward work program for updating guidance |
Agree in principle |
Commitment to consult with stakeholders The Government agrees in principle to this recommendation and will take a phased approach to updating the Guidance and other resources, consulting relevant stakeholders and considering the publication of a forward work program to support compliance. |
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Recommendation 26: Legislative amendments related to guidelines |
Agree in principle |
Commitment to consult with stakeholders The Government agrees in principle to this recommendation and will consult with stakeholders and the Federal Commissioner on developing a model for high-risk declarations designed to aid identification, assessment and response to modern slavery risks, which will consider legal, economic, and foreign policy implications. |
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Recommendation 29: Further review of the Act |
Agree in principle |
Commitment to a future review of the Act The Government agrees in principle to this recommendation and commits to a further three-year review of the Act following the implementation and operation of upcoming reforms, to ensure continuous improvement in addressing modern slavery risks. |
Are you a reporting entity?
As a reminder, reporting under the Act is not limited to certain sectors or industries.
Businesses are required to submit a modern slavery statement under the Act if they are an Australian company, or foreign company carrying on business in Australia, with an annual consolidated revenue of at least $100 million.
Foreign businesses should consider if they are captured by the reporting regime if they have sufficient connections to Australia to be considered to carry on business in Australia, within the meaning of s 21 Corporations Act 2001 (Cth).
Reporting entities, as well as businesses nearing the $100 million annual consolidated revenue threshold, should proactively monitor developments in this space and be prepared to adjust their modern slavery risk identification and management processes.
In April, we released our annual review of modern slavery law developments in Australia and six other relevant international jurisdictions and what changes businesses should be prepared for as we look ahead. Download the report here.
