By Patrick Hatch
Some of Australia's major retailers are woefully unprepared for new laws likely to be brought before parliament that will force them to show how they ensure their products are not made with slave labour.
A joint federal parliament committee last month called on the government to introduce a Modern Slavery Act, including mandatory supply chain reporting for large companies.
The committee's chair, Liberal MP for Dunkley Chris Crewther, said he was "quite confident" legislation would be introduced to parliament in 2018, and warned that some companies were not doing enough to vet how their goods were made.
The committee recommended that businesses with annual revenue of more than $50 million should have to disclose where their products come from and detail what steps they took to ensure slavery and labour abuse did not existing in their supply chains.
A list of companies that have to report and which ones complied would be made public, and after two years the government would start to name and shame companies that failed to report.
The committee called for financial penalties for businesses that did not comply, and for companies that failed to act on evidence of exploitation.
“I do realise that for larger companies, if the penalty is $100 or $1000 or $10,000 it may not be a disincentive in and of itself, [but] if that is public knowledge that’s not a good look for a large company trying to build a public image," Mr Crewther said.
Over 40 million people around the world are today estimated to be victims of "modern slavery", including forced labour, bonded labour, and human trafficking.
'Down the rabbit hole'Retailers - already under pressure about "sweat shops" since more than 1110 people were killed in the Rana Plaza factory collapsed in Bangladesh in 2013 - would be significantly affected by the proposed rules, according to Australian Retailers Association chairman Russel Zimmerman.
He said the peak body would push for "light touch" regulation that would allow retailers to simply ask their suppliers or the immediate next point along their own supply chains to guarantee their products are clean.
“You shouldn't need to keep going down the rabbit hole," Mr Zimmerman said.
“We don’t want these regulations to make retailers go to the shirt manufacturer, to the cotton manufacturer, to the button manufacturer, to the supplier of the material, to whoever else it may be."
Carolyn Kitto, a director at anti-slavery group Stop The Traffik, said that many large companies' existing transparency initiatives would already fulfil what would be required of them under the reporting laws.
The group has spent more than four years lobbying fashion retailers to disclose their plans and polices to mitigate labour abuse in their products.
While some businesses have been responsive, others have refused and resorted to legal threats against Stop The Traffik.
“They’ve got some catching up to do,” Ms Kitto said.
She said while some businesses were concerned about the cost of complying, "there’s going to be way more of a cost if you don’t do the right thing and human slavery is found in your supply chain".
Mr Zimmerman said there would be positives from mandatory reporting, including stores being able to promote the fact their products were ethically sourced.
Mr Crewther said he wanted to see voluntary reporting for companies under the threshold for businesses that wanted to trumpet their ethical credentials.
He said the laws would create a more even playing field by ensuring business were not using worker abuse and slavery to undercut competitors on price.
The proposed new laws borrow heavily from Britain's Modern Slavery Act introduced in 2015, which has been criticised as a toothless tiger because there are no penalties for failing to report.
“If most of our recommendations are adopted I think we’ll be world-leading in this area," Mr Crewther said.
The parliamentary committee heard of abuses taking part in industries in the Asia Pacific region including garment manufacturing, palm oil cultivation, and on finishing ships.
Published on the Sydney Morning Herald on January 1, 2018.