Thinking | 12 May 2020
COVID-19 changes: deadline extended for modern slavery statements
By Alison Baker
In light of the COVID-19 pandemic, drastic changes to supply chain operations are exposing an increased risk of forced labour, debt bondage, human trafficking, and exploitation on a global scale. These issues are further compounded for migrant workers, who may be unable to work but also unable to return to their home country.
The Federal Government has responded to this uncertain climate by providing further support for businesses that are required to report on modern slavery risks. Read on to find out how these changes affect your business.
New deadlines for modern slavery statements
Is your business preparing to lodge a modern slavery statement? Good news: a 3 month extension has been announced for many businesses in light of COVID-19 uncertainty.
As explained in our previous article, under the Modern Slavery Act 2018 (Cth) modern slavery statements must be submitted by Australian entities, Commonwealth government entities and foreign entities carrying on a business in Australia, with an annual consolidated revenue of at least $100 million.
On 28 April 2020, the Australian Border Force extended submission deadlines as follows:
|Reporting period (your entity’s annual accounting period)||Original deadline||New deadline|
|1 April 2019 – 31 March 2020 (Foreign financial year)||30 September 2020||31 December 2020|
|1 July 2019 – 30 June 2020 (Australian financial year)||31 December 2020||31 March 2021|
|1 January 2020 – 31 December 2020 (Calendar year)||30 June 2021||30 June 2021 (no change)|
You’ll note that the six month deadline for calendar year reporting periods, and other reporting periods ending after 30 June 2020, remains unchanged.
If you’re unsure whether your business is required to submit a modern slavery statement, or you need support on how your business can comply with this requirement, you should seek advice. We would be pleased to discuss with you how our team of employment, corporate and tax lawyers can assist your business.
Guidance on the impact of COVID-19 on modern slavery statements
The Australian Border Force has also issued helpful guidance on reducing the risk of vulnerable workers becoming exposed to modern slavery as a result of the COVID-19 pandemic. The Australian Border Force recommends that businesses take steps such as:
- Informing the board and executives about modern slavery risks as part of COVID-19 updates;
- Using internal sustainability, human rights or modern slavery working groups to identify opportunities for action;
- Fostering open communication with suppliers about modern slavery risks, including asking suppliers what steps they have taken to protect their workers from COVID-19 (such as providing workers with protective equipment, providing sick leave or carers leave, and increasing cleaning in factories and buildings to minimise the risk of infection);
- Collaborating with other stakeholders in your industry to identify best-practice approaches to supporting and protecting vulnerable workers in global supply chains.
Importantly, the Australian Border Force’s guidance addresses how businesses should report on the impact of COVID-19 in their modern slavery statements. It accepts that due to the impact of COVID‑19, some businesses may be unable to provide detailed responses to some of the mandatory criteria, or implement changes that address modern slavery risks before the reporting deadline. It explains that this may occur due to an inability to undertake planned activities to address modern slavery risks, limited capacity to prepare statements, or significant changes to supply chains.
In those circumstances, the Australian Border Force states that modern slavery statements should include an explanation of how COVID-19 has impacted your business’s capacity to assess and address modern slavery risks during the reporting period. They should also set out any delays or inability to implement actions that address modern slavery risks.
Overall, the Australian Border Force guidance doesn’t change the mandatory reporting criteria that must be addressed in a modern slavery statement. However, it does indicate that the Commonwealth government will take a pragmatic approach to assessing the first modern slavery statements submitted under the new regime.
Given the complexities of the COVID-19 climate, and the significant reputational risks of a non-compliant statement being published by the government, we would be pleased to work with you to ensure your modern slavery statement is legally compliant. Contact us to discuss your needs.
Read our previous article 'Modern slavery laws have commenced: here’s what you need to know'.
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