The Albanese government's recent announcement of sweeping reforms to combat forced labor in global supply chains is a significant step forward, but it also highlights the ongoing challenges in ensuring ethical practices across international trade. These reforms, which include the introduction of criminal charges for large Australian companies failing to prevent modern slavery, are a response to mounting pressure from investors, unions, and human rights advocates. The government aims to give the country's modern slavery regime "teeth," addressing the shortcomings of the existing laws that relied heavily on voluntary reporting.
The proposed changes come as a reaction to the Trump administration's criticism of Australia's efforts in combating forced labor. The US threatened an additional 12.5% levy on affected goods, singling out Australia as one of 54 economies that had not done enough to stop imports made with forced labor. This international scrutiny has prompted the Albanese government to take a harder line, with Attorney-General Michelle Rowland announcing criminal charges for companies with annual consolidated revenue above $100 million that fail to prevent modern slavery.
The reforms also introduce civil penalties for non-compliance with the existing Modern Slavery Act, marking a shift from voluntary reporting to mandatory due diligence. This change is supported by an independent review led by Professor John McMillan, which found that the 2018 Modern Slavery Act had not yet caused meaningful change for victims. The review recommended mandatory due diligence requirements, which the government has largely accepted.
The impact of these reforms is significant. Modelling by Fair Supply estimates that over 21% of all goods brought into Australia last financial year were linked to supply chains where coercion, debt bondage, and other forms of modern slavery are known to occur. This equates to approximately $1 in every $5 spent on imports, highlighting the scale of the issue. The Global Slavery Index further estimates that around 50 million people worldwide are living in modern slavery, with more than one in five goods imported into Australia coming from supply chains with known forced labor risks.
However, the effectiveness of these reforms is not without question. The Australian Council of Trade Unions president, Michele O'Neil, welcomes the accountability measures but warns that a standalone criminal offence may have limitations if left solely to police enforcement. Similarly, Be Slavery Free, a coalition of civil society campaigning against human trafficking, forced and child labor, argues that the changes still fall short of delivering the systemic change needed. They compare the reforms to a promise of a fence at the top of a cliff, with the same inadequate ambulance service waiting at the bottom for those who fall through the gaps.
Despite these concerns, the introduction of criminal liability into the Modern Slavery Act is a clear signal of the government's commitment to holding businesses accountable. It sends a powerful message that exploitation in supply chains will not be tolerated, and it aligns Australia with comparable economies that have already imposed stronger corporate obligations. However, the success of these reforms will depend on the government's ability to ensure that prosecutions are achievable and that the bar for convictions is not set too high.
In conclusion, the Albanese government's reforms to combat forced labor in global supply chains are a necessary and significant step. They introduce much-needed accountability measures and address the shortcomings of the existing laws. However, the challenge of ensuring ethical practices across international trade remains complex, and the government must continue to work towards delivering systemic change to protect workers' rights and prevent exploitation.
