The Federal Modern Slavery Bill 2018 passed both houses, with amendments, on 28 November and will become law.  A brief overview of the key changes and short recap of the Bill is below.

Recap: Mandatory Reporting requirements for large entities

As previously reported in Modern Slavery Bill 2018 (Cth) introduced the legislation will:

• Introduce a Modern Slavery Reporting Requirement. This will require businesses with annual consolidated revenue of more than $100m (including foreign entities carrying on a business in Australia), to publish annual statements on the steps they are taking to address modern slavery in their supply chains and operations.  The Commonwealth is required to report on behalf of non-corporate Commonwealth entities, and the reporting requirements also apply to Commonwealth corporate entities.
• Entities will be required to report on all modern slavery practices criminalised under Commonwealth law (eg trafficking in persons; forced labour, forced marriage) in line with mandatory reporting criteria. 
• Reports will be kept by the Minister in a publicly accessible, online repository, the Modern Slavery Statements Register. 
• Timeline:  The precise date at which reporting requirements commence will be fixed by proclamation to enable the government to align the requirements to commence at the beginning of either the Australian calendar year or the Australian financial year. This is also intended to allow entities time between passage and commencement of the legislation to identify whether they are a reporting entity and to become familiar with their obligations to comply with the Modern Slavery Reporting Requirement.  The proclamation period is limited to a period of six months. If proclamation does not occur within six months after the Bill receives Royal Assent, the Bill will automatically commence the day after six months from Royal Assent.

Amendments: New compliance and oversight measures 

The amendments are intended to establish 'an appropriate mechanism to address non-compliance'; strengthen parliamentary oversight of the implementation of the new reporting requirement, and to provide a 'clear pathway to future civil penalties if initial compliance rates are inadequate'.

• Option for the Minister to name and shame non-compliant entities where there is 'serious non-compliance': A new section (s16A) has been inserted which will empower the responsible Minister to require suspected non-compliant entities to explain why they have not complied with the Modern Slavery Reporting Requirement and to undertake specified remedial action where the Minister requires it eg to provide a Modern Slavery Statement to the Minister or to revise a statement to address all the requirements set out in s13 or 14 of the legislation.   Subsection 16A(4) provides that the Minister may publish the identity of the entity (and other details) on the Modern Slavery Statements Register 'or in any other way the Minister considers appropriate' if the entity fails to comply with the minister's request by either: failing to provide an explanation in relation to the Minister's request for an explanation; or failing to take remedial action in response to a request made by the minister to do so.
• Annual reporting to parliament: The Minister is required to report annually to the parliament about the implementation of the Modern Slavery Act including compliance trends.  This is intended, according to the Supplementary Explanatory Memorandum to ensure there is 'ongoing monitory and evaluation' as well as to provide a mechanism to identify any amendments required before the three year review.
• Review after three years to assess whether civil penalties are required: the Legislation will be reviewed at the end of three years to consider the 'necessity and timing for future reviews and whether amendments are needed to include additional compliance mechanisms, such as civil penalties'.

Impact?

Commenting on the Bill, MinterEllison Partner Geraldine Johns-Putra, said that the passage of the legislation, and the inclusion of stronger oversight and compliance mechanisms in the legislation, reflects the huge support for modern slavery reporting politically and in the community.  However, she noted that 'right up to the passage of the Bill, the question of including penalties in the legislation has arisen. Given the amendments to the bill, that debate continues notwithstanding passage of the Bill' she said. She added that companies should make full use of the three year period prior to review of the Act. 'Overseas experience has shown that although many companies take their obligations seriously, they do use the first year report as a learning opportunity and sometimes adjust their approach in the second year.'

Response

The Bill appears to have been broadly welcomed, but there appears to be strong support for both the introduction of civil penalties and the appointment of an Anti-Slavery Commissioner from some organisations.

• Statement from the Business Council: The Business Council issued a statement welcoming the passage of the legislation.  Business Council CEO Jennifer Westacott said 'We congratulate the Parliament in establishing this important piece of legislation, which the Business Council has long supported.  Modern slavery is abhorrent and business looks forward to continuing to work with the government on implementing the legislation…We believe greater transparency of supply chains will drive better practice and reveal which companies are working to maintain clean supply chains.'
• Stop the Traffik issued a media release welcoming the passage of the Bill as an important 'first step' but cautioning that 'it is only a start'.  In particular, the organisation would like to see the appointment of an Anti-Slavery Commissioner and for other matters raised in the 'Hidden in Plain Sight' report to be addressed going forward. 

[Note: For an overview of the issues raised in the Hidden in Plain Sight report see: Modern slavery & global supply chain reporting: Gearing Up for Compliance 18/06/2018]

• Law Council of Australia President, Morry Bailes has reportedly welcomed the passage of the Bill as an important step in eliminating slavery but has said that he would like to see the appointment of an Anti-Slavery Commissioner and a penalty regime to ensure accountability.
• The Australian Council of Trade Unions reportedly said that an Anti-Slavery Commissioner should have been appointed and expressed disappointment that civil penalties were not included.