Modern Slavery Policy Australia: Do Small Businesses Need One?
Many business owners assume modern slavery laws only apply to large organisations. While formal reporting obligations sit with larger entities, smaller businesses are increasingly being asked to demonstrate compliance.
Modern slavery refers to situations where individuals are exploited and unable to refuse or leave work. This can include forced labour, deceptive recruitment practices, or unsafe working conditions.
When does this apply?
Under the Modern Slavery Act 2018 (Cth), only certain entities are required to formally report. This generally applies to organisations with annual consolidated revenue of $100 million or more. However, smaller businesses are often impacted indirectly.
While there is no legal requirement for small businesses to report under the Act, many are now being asked to demonstrate compliance as part of supply chain expectations.
This commonly occurs where you:
Supply goods or services to larger organisations
Engage labour hire, contractors or overseas suppliers
Operate in industries with higher labour risk
We are seeing more clients being asked to confirm they have appropriate policies in place before contracts are awarded or renewed.
Why small businesses are still being asked
Even if you are not legally required to report, your clients may be.
This means they need to:
Assess their supply chain
Demonstrate due diligence
Confirm that their suppliers are not exposing them to risk
As a result, requests for modern slavery policies are becoming more common, even for small and medium businesses.
A practical example
We recently worked with a regional business that used seasonal labour during peak periods.
They were not required to report under legislation. However, one of their key clients requested confirmation that they had considered modern slavery risks within their operations.
A simple, tailored policy was prepared to address this requirement and allowed them to continue supplying without issue.
What a modern slavery policy includes
A practical policy does not need to be complex. It should clearly set out:
A commitment to ethical and lawful practices
Awareness of potential risks in operations and supply chains
Expectations of suppliers and contractors
A process for raising and managing concerns
The key is that the policy reflects how your business actually operates.
Do you need one?
Not every business will require a modern slavery policy. However, if you:
Supply to larger organisations
Are tendering for work
Use labour hire or external suppliers
it is worth considering whether one may be required.
Final point
This is an area that is continuing to evolve. While it may not have been relevant previously, we are seeing expectations shift quickly, particularly in supply chains.
If you are unsure whether this applies to your business, we can assess your situation and prepare a tailored modern slavery policy where required.
