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Lodgement Extension: Modern Slavery Statements

A welcome extension but does COVID-19 present additional reporting requirements?

The Australian Government has announced a 3 month extension for lodgement of an entity’s first modern slavery statement under the Modern Slavery Act 2018 (Cth). However, the extension may not ease administrative pressure. In Hon Jason Wood MP’s statement announcing the extension, he emphasised the necessity for entities to consider new or changing modern slavery risks linked to COVID-19 within their modern slavery statement.

New reporting deadlines

The 3 month extension applies to all reporting entities (over $100 million in consolidated revenue) operating in the relevant reporting periods ending on or before 30 June 2020. To summarise:

How might COVID-19 be impacting your supply chain?

COVID-19 may be causing subtle operational changes that disproportionately impact some areas within supply chains and increase overall modern slavery risks.

The Department of Home affairs recently issued guidance highlighting potential risk areas such as, sudden changes to supply chains – potentially introducing new suppliers – changes to demand and also changes in expectations of employees. Particularly in the event of high demand, last minute, and short term orders, entities should consider how these relationships may increase modern slavery risks within their supply chains.

How to address new risks

  1. Internally, new or heightened modern slavery risks as a result of COVID-19 should be addressed as part of every board and executive response to the pandemic. Consider including this as an agenda item to board or executive meetings.
  2. Within your supply chains, foster relationships with your suppliers. Where possible, entities should maintain current supplier relationships and take steps to support vulnerable workers. Steps may include:
    1. paying for completed work and extending orders over time to ensure ongoing cash flow for suppliers;
    2. avoiding varying contracts unreasonably or seeking discounts; and
    3. asking suppliers what steps they are taking to protect their workers.
  3. In your modern slavery statement, you should explore:
    1. how your structure, operations and supply chain have been impacted by COVID-19. For example, identifying parts of operations that have been reduced or shut down or identifying new supply chains to source personal protective equipment for workers;
    2. new risks areas including labour standards in supplier factories where new supply chains have been sourced; and
    3. steps taken and priorities to mitigate, report or prevent new risks – recognising any strengths, limitations and intentions over the next reporting period.

If you would like to discuss how COVID–19 may or has impacted your modern slavery risks or if you would like guidance in preparing your modern slavery statement please contact us and a member of our Corporate team will be able to assist.

This publication has been prepared for general guidance on matters of interest only and does not constitute professional legal advice. You should not act upon the information contained in this publication without obtaining specific professional legal advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication and to the extent permitted by law, Cowell Clarke does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting or refraining to act in relation on the information contained in this publication or for any decision based on it.

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