Navigating The
Modern Slavery Act
Learn what recent changes to the Modern Slavery Act mean for your sites and contractors. Discover important updates to the legislation and how your business can remain compliant and ethical with best practice across your sites.
TL:DR – Key Takeaways
- What is the Modern Slavery Act: It is crucial Australian legislation requiring businesses to identify, address, and report on risks of modern slavery in their operations and supply chains. The Act affects businesses that employ service providers, contractors and subcontractors, including cleaners, maintenance workers, and security personnel.
- Important Updates: Despite a proposed drop to $50M in 2023, the reporting threshold for mandatory reporting requirements remains at $100M in annual consolidated revenue. A federal Anti-Slavery Commissioner is now in place, empowered to issue guidance, name high-risk sectors, and support victims.
- The Need for a Proactive Approach: Non-compliance isn’t just a legal risk; it’s a brand and reputational risk. Leading businesses are using real-time, data-driven platforms to stay compliant, update policies, and ensure visibility across sites. Learn the tools, workflows, and systems that keep your business safe.
The Modern Slavery Act continues to impact small and medium-sized businesses (SMBs), mandating decisive action against exploitation. With recent government reviews and new recommendations, staying up-to-date and adapting policies and practices is crucial. Ensuring your operations and supply chains are free from exploitation is now not only a moral imperative but a legal obligation to protect your business from reputation damage and financial penalties.
Modern Slavery – Why Should You Care?
Within the facilities management industry, modern slavery risks can be present (and often hidden) in the wide range of services – from cleaning, maintenance, security, catering, to waste management and more. Layers of subcontracting, particularly common in these industries, can further obscure these exploitative practices, making them even more challenging to detect and address. The risk of non-compliance with modern slavery falls back on businesses despite contracting or sub-contracting arrangements.
Non-compliance with the Modern Slavery Act can lead to significant financial penalties and reputation damage. Furthermore, beyond legal obligations and financial penalties, customers, investors, and partners increasingly expect businesses to uphold strong ethical standards.
Addressing modern slavery is not just about compliance; it is about safeguarding human rights, enhancing your brand’s reputation, and ensuring long-term operational success.
Recent Changes & Their Implications
In May 2023, the Australian Government completed an independent review of the Modern Slavery Act, led by Professor John McMillan. While the Act resulted in increased awareness, the review concluded that it had not delivered meaningful outcomes for businesses and affected individuals.
Key proposals included:
- Lowering the reporting threshold to $50 million in annual consolidated revenue to include more businesses. This was not adopted and the threshold for businesses remains at $100 million;
- The proactive requirement to demonstrate Modern Slavery policies were implemented effectively within businesses;
- Introduction of new mandatory reporting criteria, including identifying modern slavery incidents and grievance mechanisms; and
- The establishment of an Anti-Slavery Commissioner to oversee the implementation and enforcement of the Act and coordinate national efforts against modern slavery. In May 2024 the Australian Government established Australia’s first federal Anti-Slavery Commissioner to support the mission and regulatory change.
Recent Updates
Although a lower $50 million threshold was proposed in the 2023 review, the Australian Government has confirmed the reporting threshold will remain at $100 million. Since July 2024, additional developments include:
- The Anti-Slavery Commissioner is fully operational and empowered to declare specific sectors, industries, or regions as high-risk, requiring enhanced due diligence.
- New legislative proposals include civil penalties for non-compliance (e.g. failing to lodge a modern slavery statement or submission of false information).
- A move towards mandatory human rights due diligence for qualifying businesses is under active review but not yet legislated.
These changes highlighted the demand and growing expectations from government to demonstrate evidence-based approaches to managing modern slavery risk.
Strengthening Modern Slavery Practice
Many of our clients have successfully navigated the growing complexities of the Modern Slavery Act. The following three key features have been integrated into our platform to ensure complete compliance for modern slavery reporting:
- A Central Repository: The Verified platform is integrating and serving as a central repository for modern slavery statements and policies, ensuring easy access and integration as required in reporting workflows;
- Real-Time Updates: Businesses are efficiently updating policies and ensuring that all stakeholders have immediate access to the most current information; and
- Transparency & Tracking: The platform’s existing capabilities provide auditable transparency on who has reviewed policies and seen critical documents to ensure practice is understood by all relevant parties.
Tips To Stay Compliant
To ensure you and your business stay compliant, teams can implement best practice within their operational workflows and reporting procedures. Here are some tips to ensure compliance:
- Regularly Review and Update Policies: Ensure all policies are up-to-date and accessible to employees, contractors, and visitors.
- Implement Strong Reporting Mechanisms: Facilitate confidential and anonymous disclosure of concerns to tackle modern slavery effectively.
- Engage in Continuous Monitoring: Regularly audit supply chains and operations to identify and mitigate risks.
- Educate and Train Staff: Provide ongoing training to ensure all stakeholders understand modern slavery risks and how to report them.
Looking Ahead
Staying compliant with the Modern Slavery Act requires continuous effort and adaption to new regulations. As oversight increases and potential penalties become more likely, businesses must be proactive in strengthening compliance systems and engaging transparently with all stakeholders.
The Verified team is passionate about helping businesses navigate these changes and promote ethical practices across your operations. For more information on how Verified can assist you in meeting these requirements, contact us on 1300 133 950 or via email.