NSW's landmark Modern Slavery Act and what it means for local councils

Modern slavery is closer than you might think

The Walk Free Foundation’s Global Slavery Index estimates that 15,000 people in Australia[1] (and 40 million people globally[2]) are living in modern slavery.

In the last complete year of records, the Australian Federal Police received 224 reports of human
trafficking, slavery and slavery-like offences. One of those reports led to the arrest of the owners of The Cake Merchant, a chain of cake stores in Western Sydney.

The owners have been accused of making an employee work excessive hours without pay, confiscating their passport, using threats of deportation and monitoring overseas phone calls with friends and family. They have been charged with multiple modern slavery offences.

Developments in reporting obligations

The Modern Slavery Act 2018 (Cth) (Commonwealth Act) has been in place for nearly four years and imposes mandatory reporting obligations on Commonwealth government bodies and private enterprises if they meet specific criteria. Local councils were not subject to any modern slavery reporting requirements under the Commonwealth Act.

With recent amendments to the Modern Slavery Act 2018 (NSW) (Act), which come into effect on 1 January 2022, local councils will now be obliged to review their supply chains and undertake a form of modern slavery reporting.

Thanks to their extensive supply chains, local councils can play an important role in the fight against modern slavery. The Act requires councils to take reasonable steps to ensure the goods and services they buy are not the product of modern slavery, and to report on how to do this.

What are the obligations of local councils?

The Act imposes less onerous reporting obligations compared to the Commonwealth Act. While the
Commonwealth Act sets out several mandatory reporting criteria for preparing a Modern Slavery Statement (MSS), the Act is less prescriptive and requires councils to:

• assess the risks of modern slavery within their supply chains

• implement effective due diligence to ensure that goods and services are not the product of modern slavery

• include a statement in their annual report (which must be publicly accessible) detailing:

  • the steps taken to ensure goods and services procured during the reporting period were not the product of modern slavery

  • action taken in relation to any issue identified as significant by the Anti-Slavery Commissioner (see

    below) concerning the operations of the council during the reporting period

• co-operate with the Anti-Slavery Commissioner in the disclosure of information and provision of assistance and support with respect to modern slavery and victims of modern slavery.

A local council is not obliged to prepare a MSS in accordance with the Commonwealth Act or file it on the federal Modern Slavery Statement Register. However, if it chooses to do so, it will meet the requirements of the Act.

To facilitate disclosure and transparency, the Act also provides protection from criminal and civil liability if information is disclosed in good faith to the Anti-Slavery Commissioner, which may otherwise be subject to disclosure restrictions, for example, confidentiality obligations.

Anti-Slavery Commissioner

With the Act comes the establishment of Australia’s first Anti-Slavery Commissioner, an independent office with broad oversight of Government agencies and local councils.

The Anti-Slavery Commissioner has multiple roles, including awareness, education, monitoring and maintaining anti-slavery records.

The Commissioner will also:

• monitor the effectiveness of legislation, governmental policies and action taken to combat modern slavery

• issue codes of practice and maintain a public register of Government agencies and local councils that do not apply.

Other roles include recommendations, information, advice, education and training about ways to prevent modern slavery.

The public register

A publicly available register will be maintained by the Anti-Slavery Commissioner to identify any Government agency and local council that has failed to:

• comply with the Act or directions of the Commissioner

• take appropriate steps to ensure future compliance with the Act in the future.

Penalties and public perception

Failure to publish a Modern Slavery Report is not currently punishable under the Act. However, this may change. That said, the Crimes Act 1900 (NSW), Human Tissue Act 1983 (NSW) and the Criminal Code Act 1995 (Cth) do carry penalties for modern slavery offences.

Of course, councils will be less concerned with penalties than they are with doing the right thing and being seen by ratepayers to be acting this way.

Preparing for the reporting period

If you are a local council that requires assistance in preparing for the reporting requirements under NSW’s modern slavery law, please get in touch with us to discuss how we can help you meet your obligations under the Act. We have advised clients on their obligations to report under the Commonwealth Act, assisted with due diligence processes to determine modern slavery issues and responses, and prepared MSS’s for lodgement on the Modern Slavery Statements Register.

Authors: Jason Sprague & Samantha Pacchiarotta

Read further articles in Council Connect

[1] 2018 Global Slavery Index – Australia, Walk Free Foundation https://www.globalslaveryindex.org/2018/findings/country-studies/australia/.

[2] 2018 Global Slavery Index – Global findings, Walk Free Foundation https://www.globalslaveryindex.org/2018/findings/global-findings/