Modern slavery due diligence: a business imperative

From 21 July to 1 September 2025, the Attorney-General’s Department (AGD) is inviting public submissions on a set of proposed reforms to the Modern Slavery Act 2018 (Cth)(the Act). The proposed changes seek to enhance the reporting framework, simplify and improve reporting, and target non-compliance. With stricter obligations and penalties on the horizon, businesses should take steps now to review and enhance their approach to managing modern slavery risks across their operations and supply chains.

Key takeaways:

1. Australia is looking to reform the Modern Slavery Act with stronger reporting requirements and civil penalties for non-compliance.
2. Increased disclosure requirements, global legal trends and rising litigation risks make robust human rights due diligence, audit trails and record keeping essential for businesses.

In July 2025, the Attorney-General’s Department (AGD) launched a national consultation process to strengthen the Modern Slavery Act, following the government’s formal response to a major review of the Act’s first three years. The reform process will roll out in three phases: public and targeted consultations; legislative amendments; and updated guidance and administrative measures.

Separately, in line with a key recommendation of the review, the government established the Office of the Commonwealth Anti-Slavery Commissioner in 2024. Chris Evans was appointed as the first Commissioner on 7 November 2024 for a five-year term. Under Section 20C of the Act, his responsibilities include promoting compliance, supporting businesses, engaging victims, raising awareness, encouraging collaboration, conducting research, and advising government on policy improvements.

Earlier this year, the Commissioner’s office launched a consultation on its 2025–2028 Strategic Plan to help shape its priorities. While the Commissioner’s work focuses on delivering the functions set out in the Act, the AGD’s consultation targets potential legislative changes. Together, these initiatives are designed to strengthen Australia’s overall response to modern slavery.

Impacted businesses and interested stakeholders are encouraged to share their views and concerns on current and future consultations through the consultation hub.

Current mandatory reporting criteria

Entities with an annual consolidated revenue of at least A$100 million are required to submit annual modern slavery statements to a publicly accessible Modern Slavery Statement Register. These statements must address the following reporting criteria:

1. Identification of the reporting entity
2. Description of the entity’s structure, operations and supply chains
3. Description of the risks related to modern slavery practices within the operation and supply chain
4. Description of actions, including due diligence and remediation processes, to assess and address risks
5. Description of how effectiveness is assessed
6. Description of the consultation process
7. Any other relevant information about the entity.

These reporting criteria apply to individual statements, joint statements, and the Commonwealth statement covering all non-corporate Commonwealth entities. Reporting guidance is available here: Official Modern Slavery Act Guidance.

Key proposed changes in the consultation

To strengthen the operation and impact of the Act, the Australian Government has proposed a range of targeted reforms. These reforms aim to enhance reporting clarity, increase accountability, and improve the effectiveness of responses to modern slavery risks. The consultation paper released by the AGD outlines potential changes across six areas:

Area	Proposed amendments
Expansion of mandatory reporting criteria and addition of delegated legislation	Require statements to identify entities owned or controlled by the reporting entity. Require reporting on actions taken by the reporting entity and its owned or controlled entities, in relation to modern slavery risks, including due diligence. These actions include: Identify and assess risks of modern slavery practices Address modern slavery risks Monitor the implementation and effectiveness of its actions. Additionally require the reporting entity to report on its grievance mechanisms. Additionally require the reporting entity to report on its processes and actions to remediate modern slavery incidents. The consultation suggests that delegated legislation be added with more guidance and rules for reporting. It is intended to enhance flexibility and effectiveness by requiring more detailed reporting on governance and action. It will allow the rules to be less static than when included in an act. Similar approaches have been used for other ESG reporting, such as NGER.
Enhanced regulatory and Enforcement powers	Strengthen the AGD’s powers to address non-compliance better, including: Allowing broader information-gathering powers (e.g. requesting relevant documents) Introducing enforceable undertakings, infringement notices, publication and redaction powers, and civil penalties.
Joint reporting	Replace joint reporting with corporate group reporting. This would mean a parent entity would need to report on behalf of the whole group, including entities that do not meet the threshold.
Amendments to voluntary reporting	Allow voluntary reporters to revoke their status at any time by notifying the Minister.
Notification framework	Create a formal notification framework with minimum required information that can be used by entities whose reporting circumstances change.

Global response to modern slavery

Similar to Australia, governments around the world are responding to modern slavery through a mix of legal, regulatory, and policy measures aimed at prevention, enforcement, and victim protection. Most countries have already introduced laws criminalising practices like forced labour, human trafficking, and child exploitation.

An increasing number of countries are developing corporate reporting requirements that compel businesses to disclose how they manage the risks of modern slavery in their supply chains. Some jurisdictions, particularly in Europe, have gone further by mandating human rights due diligence. Trade-based measures are also becoming more common, with countries enforcing import bans on goods linked to geographies or supply chains with a very high risk of forced labour. At the same time, national action plans, public procurement reforms, and the creation of oversight bodies such as anti-slavery commissioners and specialised law enforcement units demonstrate a growing commitment to systemic responses.

Beyond risk mitigation and prevention, many governments are also focusing on victim protection and international cooperation. This includes providing survivors with legal support, safe housing, and access to temporary visas, as well as investing in training for frontline workers and awareness campaigns to help prevent exploitation. International partnerships, such as those led by the United Nations and the International Labour Organisation, also play a critical role in aligning national efforts with global standards.

Mandating due diligence and disclosure

Like Australia, several countries have modern slavery related disclosure or due diligence obligations in place for businesses. For example:

The UK Modern Slavery Act 2015 requires businesses with an annual turnover exceeding £36 million to publish annual statements outlining steps taken to manage slavery risks within their supply chains. Post a review of the effectiveness of its legislation as a mechanism to reduce modern slavery, recommendations to mandate due diligence are currently sitting with the parliament.

This year, the UK Government updated the statutory guidance under the UK Modern Slavery Act 2015 by releasing an international reporting template covering modern slavery, forced labour, and child labour. The template is designed to help entities meet supply chain transparency requirements across the United Kingdom, Australia, and Canada. It serves as the international template to help reduce the administrative burden of multi-jurisdictional statements.

Since 2017, France’s Duty of Vigilance Law has mandated large companies[1] to publish a ‘vigilance plan’ that details due diligence measures to identify and prevent human rights and environmental infringements and preventative controls.

Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act (2023) requires large companies and government institutions to report annually on the measures they are taking to prevent forced and child labour in their supply chains. The law applies to entities doing business in Canada that meet certain financial or employee thresholds[2] and mandates public disclosure of due diligence processes, risk assessments, and training. There are fines in place for non-compliance.

In Germany, the Supply Chain Due Diligence Act was introduced in 2021, which outlines specific due diligence obligations relating to human rights risks in the supply chain. Companies in scope[3] must issue a policy statement setting out their human rights strategy, expectations, and identification of key risk areas.

With the EU Corporate Sustainability Due Diligence Directive (CSDDD) – which requires large companies operating in the EU to identify, prevent, and address human rights and environmental harms across their entire value chains – coming into force in 2028, and the Corporate Sustainability Reporting Directive (CSRD)[4] already in force, multi-jurisdictional companies will need to consider how best to meet due diligence and reporting requirements across jurisdictions, keeping in mind current and upcoming regulations.

Trade-based measures

Since July 1, 2020, Canada has banned the import of goods produced through forced labour under the Customs Tariff. This ban was later extended to include goods made using child labour following the introduction of the Fighting Against Forced Labour and Child Labour in Supply Chains Act.

The U.S. also enacted the Uyghur Forced Labor Prevention Act (UFLPA) to take prohibitive action against the import of goods produced with forced labour in 23 December, 2021. The UFLPA establishes a rebuttable presumption that goods mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region (XUAR) of China are made with forced labour, unless the importer has conducted due diligence and implemented effective supply chain tracing and management measures to ensure that its products are not linked to forced labour in the XUAR.

The Canadian and U.S. laws introduce legal risks and increase the onus to provide evidence that modern slavery and child labour are not identified in an entity’s supply chain. To comply, companies must implement rigorous due diligence, supply chain mapping, and risk management practices. The UFLPA, in particular, places the burden of proof on businesses to demonstrate that their products are not linked to forced labour in Xinjiang, requiring detailed documentation and credible audit trails. Non-compliance can result in shipment detentions, reputational damage, and disruption to supply chains, making proactive risk mitigation and transparency essential.

Increasing global litigation and focus on modern slavery

Global litigation around modern slavery has grown significantly over the last few years as a result of legal reforms as well as rising consumer pressure on businesses to ensure ethical supply chains.

There have been increasing legal claims against companies accused of benefiting from force labour, especially in high-risk sectors like manufacturing, agriculture and mining. Legal proceedings ae now commonly brought not only in the home countries of multinationals but also in consumer nations where there are laws in place that require supply chain accountability. This has led to cases in the US, the UK and Australia targeting companies over alleged modern slavery breaches that have occurred overseas. Recent litigation cases

Companies are facing rising risks of litigation, regulatory investigations and reputational damage if they fail to conduct meaningful supply chain due diligence.  There is also increased risks associated with supply chain failures where there has been a lack of action after identifying risks or misstatements in slavery statements. Litigation trends around modern slavery is increasingly focused on supply chain due diligence. Ongoing reforms promise further expansion of both global standards and reputational risks for companies whose supply chains are exposed to risks of modern slavery.

Dyson faces legal action over supply chain human rights risks

Since 2024, British vacuum cleaner manufacturer Dyson has faced legal proceedings in London following concerns over inadequate modern slavery due diligence and response. Twenty-four migrant workers brought claims against Dyson and its Malaysian suppliers, alleging a series of modern slavery practices in supplier factories producing Dyson components. Although Dyson UK terminated its contractual relationship with the supplier in 2021 following an independent audit that identified these issues, the company continues to face significant reputational damage and remains subject to potential civil liability findings.

In a decision from the Court of Appeal (Limbu & Ors v Dyson Technology Ltd), UK courts confirmed that UK-headquartered companies can be held liable for human rights abuses occurring abroad. This case is particularly significant as it demonstrates that, for UK-headquartered companies operating across global supply chains, human rights abuses occurring in other jurisdictions may still give rise to legal proceedings in the UK.

Dyson UK denies responsibility for any alleged unlawful working practices.

Although the case does not use the UK Modern Slavery Act 2015, it highlights that if actions aren’t adequately taken to meet the requirements of the Act, other legal frameworks, such as English tort law, can hold directors and companies accountable for human rights failures overseas. The case underscores that weak or delayed action in identifying and addressing modern slavery risks can lead not only to reputational harm but also to real legal consequences.

Uyghur association files request for documents from Kmart in Australia  

More recently, The Australian Uyghur Tangritagh Women’s Association has applied to the Federal Court seeking documents from Kmart regarding two suppliers listed in its 2024 and 2025 factory lists. The application aims to assess whether Kmart has followed its ethical sourcing procedures in relation to suppliers potentially linked to the Xinjiang Uyghur Autonomous Region. Depending on the contents of the documents, the association may consider whether Kmart’s public statements align with its obligations under Australian Consumer Law. Kmart has publicly marketed itself as an ethical business with an ethical souring program and the Association has alleged that Kmart may have engaged in misleading and deceptive conduct under the Australian Consumer Law if it has failed to sufficiently monitor the risk of forced labour in its supply chain whilst publicly claiming ethical sourcing standards.

Kmart has noted that the assumptions of the Association are inaccurate.

This is the first request of its kind against a major Australian retailer seeking transparency and accountability on potential modern slavery risks. As civil society becomes more attuned to legal tools and accountability mechanisms, organisations need to ensure they have robust due diligence and clear records in place to proactively minimise reputational impacts relating to human rights practices within a company’s operations and supply chains.

Modern slavery due diligence – aligning with best practice

With proposed reforms to the Modern Slavery Act expected to introduce stricter reporting requirements and civil penalties for non-compliance, businesses may face greater regulatory and legal obligations — particularly as modern slavery statements are signed off by the board of directors. These changes underscore the importance of transparent and well-documented due diligence processes in supporting disclosures and mitigating potential legal and reputational risks. A strong due diligence framework with oversight from the board can help organisations meet evolving expectations and respond effectively to external scrutiny.

For small and medium-sized enterprises (SMEs) that fall below the mandatory reporting threshold, customers may demand additional data and evidence of pro-human rights-related practices.

To understand and respond effectively to modern slavery risks in their supply chains, businesses can adopt a structured due diligence approach informed by recognised best practice frameworks. These include the OECD Guidelines for Multinational Enterprises, the OECD Due Diligence Guidance for Responsible Business Conduct, and the UN Guiding Principles on Business and Human Rights.

Practical first steps include:

• Reviewing modern slavery and human rights-related obligations across all jurisdictions in which the business operates.
• Considering public statements and to ensure that commitments in relation to modern slavery issues are not overstate and align with the organisation’s actual modern slavery risks and mitigation efforts.
• Identifying modern slavery risks in operations, Tier One suppliers, and beyond using the best available data. This includes assessing jurisdictional, industry-specific, and supply chain-related risks. This process supports the development of an appropriate action plan and key performance indicators (KPIs).
• Strengthening policies and expectations for employees and suppliers, and ensuring the organisation has the capability and capacity to assess modern slavery risks and report issues effectively.
• Evaluating mechanisms to respond to grievances and support victims, both within the business’s own operations and deeper in the supply chain.
• Developing and implementing plans to remedy or respond to any incidents of modern slavery uncovered.
• Reviewing and updating risk assessments regularly or after major changes to the supply chain or operating environment.

Hamilton Locke’s ESG team provides comprehensive and strategic legal advice to help you navigate the intricacies of modern slavery ensuring compliance with evolving standards. For more information or a support request, please contact our ESG team.

---

¹French companies with more than 5000 employees in the company’s direct or indirect French-based subsidiaries and with more than 10,000 employees if including direct and indirect subsidiaries globally

²Act applies to entities doing business in Canada that are listed on a Canadian stock exchange or meet at least two of the following: CAD 20 million in assets, CAD 40 million in revenue, or 250 employees.

³Companies with a registered office or branch in Germany and at least 1,000 employees.

⁴An Omnibus package delayed the formal adoption of the CSDDD and CSRD by prompting a temporary pause (“stop the clock”) in early 2024 to align the Directive with broader EU legislative priorities and ensure coherence across related sustainability laws.