Where to Next for Australia’s Modern Slavery Act
The Modern Slavery Act 2018 (Cth) (MSA) came into force on 1 January 2019. Its aim is to promote transparency: certain large businesses must publicly report annually on what they are doing to identify and manage risks of modern slavery in their operations and supply chains.
What is required?
Currently, the Act applies to businesses (or other entities) that operate in Australia and have annual consolidated revenue of at least AUD $100 million.
Under section 16 of the Act, each Modern Slavery Statement must cover certain mandatory criteria, including:
the organisation’s structure, operations and supply chains;
risks of modern slavery in those operations and supply chains;
how the entity addresses those risks (including due diligence and remediation);
how the entity measures effectiveness;
consultations with controlled entities and, where relevant, joint statement arrangements; and
any other relevant information.
If a reporting entity fails to comply (for example, fails to submit a statement), the Attorney-General can request an explanation or remedial action, and may publish the business’s non-compliance on the Modern Slavery Statements Register.
Reform on the Horizon
In 2023, an independent statutory review led by Professor John McMillan AO published 30 recommendations to strengthen the Act.
In December 2024, the Australian Government released its formal response, agreeing (in full, in part, or in principle) to 25 of those recommendations.
The Attorney General’s Department conducted consultations following the response from July-September 2025.
Key areas where change is expected include:
1. Penalties for non-compliance
One major criticism of the current MSA is that it lacks teeth: there are no real penalties for failing to comply, beyond reputational damage.
The review recommends introducing civil penalties for:
failure to submit a Modern Slavery Statement (without reasonable excuse),
knowingly providing materially false information,
failing to comply with a Ministerial request for remedial action,
failing to maintain an adequate due diligence system.
The Government’s response has agreed in principle to penalties and is now consulting on how those might operate.
2. Expanding what must be reported
The review recommends expanding mandatory reporting requirements to include:
modern slavery incidents or risks discovered during the reporting year;
grievance and complaint mechanisms (for staff, suppliers or public);
internal and external consultations undertaken in relation to modern slavery risk management;
replacing the term “operations and supply chains” with “operations and supply networks” to capture a broader scope.
The Government has agreed in principle to consult on these expanded reporting criteria.
3. Mandatory Due Diligence Systems
Currently, the Act requires reporting entities to describe their due diligence processes. The review recommends a shift to requiring an affirmative obligation: entities must implement and utilise a due diligence system that meets stipulated minimum standards, and report on it.
4. Reporting Threshold & Coverage
A significant proposed change is lowering the threshold: from AUD $100 million to AUD $50 million—to bring more businesses under the reporting regime.
If adopted, this change could bring thousands of additional entities into scope.
The Government response has “noted” this recommendation but has not agreed to it at this stage.
5. Flexible Reporting Cycles
To reduce compliance burden, the review proposes a 3-year full statement with shorter update reports in the intervening years.
6. Anti-Slavery Commissioner & High-Risk Declarations
The Government has already allocated funding to establish an Anti-Slavery Commissioner.
The review recommends that the Commissioner (or Minister) be empowered to issue declarations designating regions, products, industries or suppliers as high risk — which reporting entities would need to consider.
What you can do now
Given the likely reforms, here are practical steps for boards, company secretaries and compliance teams:
Stay informed & monitor consultation
The Attorney-General’s Department has just finished their 2025 consultation on how to implement the recommended reforms.
Entities should watch the consultation papers, make submissions where appropriate, and engage in stakeholder forums.Review current statements & processes
Assess whether your existing Modern Slavery Statement and due diligence systems would meet the proposed expanded criteria.
Could you already report on modern slavery incidents, grievance mechanisms and stakeholder consultations?Prepare for penalties & reputational risk
With penalties under consideration, the risk of non-compliance becomes more than mere reputational harm.
Ensure that internal governance, controls and accountability are aligned to minimize risk.Map your supply networks broadly
The shift from “supply chains” to “supply networks” hints at capturing indirect tiers of suppliers. Identify upstream suppliers, sub-contractors and third parties.Engage your suppliers & partners
Ask higher-tier suppliers to disclose, assist in capacity building, share risk assessments, and incorporate modern slavery clauses into contracts.Document your efforts & decisions
Where judgment calls are made (e.g. no risk found, remediation decisions), keep good records. If oversight bodies request explanations, a documented trail is critical.Train your people
Ensure staff, procurement teams and senior leadership understand modern slavery risks, reporting obligations and red flags in supply chains.Scenario plan for potential lower threshold
Even though the Government hasn’t yet committed to lowering the reporting threshold, consider whether your entity might become captured under a $50 million threshold in future — and what that would require in terms of systems, reporting and resourcing.
In Summary
Modern slavery is not only a moral and human rights issue — it also carries legal, compliance, financial and reputational risk for businesses. The pressure on companies to show genuine action is increasing, both domestically and globally.
Law firms and legal advisors play a key role in helping organisations:
understand scope and obligations under the Act,
draft or review Modern Slavery Statements,
develop due diligence systems and governance structures,
advise on supplier contracts and procurement practices,
respond to audit, regulatory or stakeholder inquiries,
engage in public consultations and legislative changes.
If your business needs help navigating the evolving modern slavery landscape — whether assessing current risk, preparing statements, or gearing up for reform — you may need legal advice.
The OYBlog was created with AI assistance using the following sources Where To Next? and Modern Slavery in Australia,