Why Australia’s proposed Modern Slavery Act does not go far enough

13 December 2017 | Andrea Tokaji, Founder, Fighting for Justice Foundation

California¹, the UK² and France³ have implemented several variations of the Modern Slavery Act, legislation that calls on businesses and companies to report on slavery in their supply chains and now has the endorsement of the Queen for all Commonwealth States⁴.

Victims of modern day slavery experience grave human rights violations against their persons, liberty, life and safety, and the crimes of human trafficking, slavery, servitude and exploitation are serious crimes and have devastating impacts.

Encouragingly, Australia is currently considering this new law, and it is a meaningful step forward for us to shine a light on our contributions to slavery through demand in the products we buy every day, and to try and stop our demand for slave based products.

If you have eaten chocolate, drank tea, worn a cheap cotton shirt, or eaten seafood, the chances are you have taken part in slavery in raw material supply chains.

Australia’s legal and international obligations⁵ require us to respond effectively to human trafficking, slavery and slavery-like practices, and ensure that non-state actors under its jurisdiction respect human rights – especially businesses making a profit from such abhorrent human rights violations.

Modern day slavery in business undermines business performance, causes reputational damage and affects shareholder and investor confidence. It breeds corruption, bribery and fraud.

It is in everyone’s best interest from an economic, human rights and gender equality perspective to eradicate slavery from all raw materials and service supply chains.

Andrew Forrest’s Fortescue Metals mining company⁶ and Sally Irwin’s The Freedom Hub café in Waterloo, Sydney⁷ are examples that not only large companies with shareholders but also small suburban cafes can operate slave-free.

There is a danger, however, that this proposed new law will forget that human trafficking and slavery is most prevalent for the purposes of sexual servitude, and that those victimised are mostly vulnerable women and girls who experience exploitation through the sex industry globally.

Out of the 45.8 million known slaves⁸ in the world today, the majority (up to 85% according to UN reports) are women and girls. UNICEF estimates that 1.2 million children are trafficked each year.

The most recent United Nations Office of Drugs and Crime Global Report on Trafficking In Persons⁹ cites that about 23,000 victims were trafficked for sexual exploitation within two years between 2012 and 2014.

When a woman or girl is enslaved for sexual servitude, in addition to being subject to slavery and often human trafficking, she is repeatedly raped, abused and assaulted. Slavery in brothel supply chains is the worst form of modern day slavery, and sexual servitude is where most of the world’s slavery is, as this is where the majority of demand is pushing for more exploitation and slavery.

Even more than our demand for chocolate, tea, cotton and seafood in raw material supply chains is the demand for sexual exploitation of women and little girls. In the proposed new laws, high-risk industries, such as brothels must therefore be placed in a specific reporting category, where additional penalties apply if reporting is not forthcoming.

No business or service should tolerate modern slavery or other serious abuses of human rights in their operations or supply chains, but slavery in brothels is particularly heinous, as prostitution has been referred to by survivors as “paid rape”¹⁰.

Australia’s brothels are fraught with criminality¹¹, corruption, gender based violence, abuse, rape and trauma of vulnerable women – including those enslaved and trafficked.¹²

In fact, the legalisation and decriminalisation of prostitution is incompatible with international human rights laws¹³, and international studies have linked the legalisation of prostitution to a rise the demand for, and actual human trafficking¹⁴.

The Australian Institute of Criminology has acknowledged the criminal links in brothels, reporting that regulated models of prostitution such as decriminalisation are failing, as they are often fraught with links to criminal gangs (AIC Report 2014).

An Australian Institute of Criminology study in the same year estimated that Australian brothels earned $1 million a week from illegal prostitution in Melbourne.¹⁵

In Victoria, estimates from the police and the legal brothel industry put the number of illegal brothels at 400, four times more than the legal ones (Murphy 2002).

Demand for sexual services has been significantly affected by legalisation – there are an estimated 60,000 visits to legal brothels in Victoria every week with spending averaging $7 million (Benbow, 2002).

Brothels must therefore have a high-risk category reporting requirement – ensuring that the ‘brothel supply chains’ are free from trafficking, slavery and exploitation. Currently, there are no assurances that those working in Australia’s brothels are there by choice - and that they have full access to all of their rights, health services and social services such as counselling.

Brothel owners who turn over millions each week need to be held accountable to report to the same trafficking free-supply chain reporting mechanisms as other businesses and corporations - ensuring that there has been no trafficking or slavery in their ‘service supply chains’ in addition to being subject to the varied regularity systems of prostitution laws in place across the various jurisdictions in Australia¹⁶.

So, what does the proposed new legislation look like?

The Modern Slavery Act Committee’s InterimReport into Modern Slavery in Global Supply Chains includes support for an Independent Anti-Slavery Commissioner to coordinate and oversee Australia’s response to combating modern slavery.

It goes without saying that the proposed Modern Slavery Act in Australia needs to include mandatory supply chain reporting annually, with a public depository for this reporting as a mechanism of public accountability for corporate companies - with a penalty for non-filing to apply.

Instead of a proposed threshold for company reporting, the Government needs to encourage a zero tolerance approach to slavery in supply chains in all raw materials and service supply chains across Australian businesses and their subsidiaries.

A phased-in introduction to reporting requirements should be a non-option, as it will stagger industry awareness, diminish business support and compliance and may delay results in uncovering slavery in supply chains in Australian businesses. Victims will suffer the most under such a proposed phased-in approach to uncovering slavery in Australian business supply chains.

As a comparison, this is akin to saying to our Australian communities that we will implement domestic violence legislation in phases – beginning with Australian-born citizens and then moving its application to other Australians. In doing this, we may not capture the most vulnerable living in our jurisdiction, and create a tiered culture of implementation and relevance.

The question of threshold should be directly linked to where the victims are.

High-risk companies, such as brothel businesses and the medical industry in which transplant tourism is practiced, must be held to a higher account within a penalized category of required reporting.

In understanding human nature and regulatory compliance, it is reasonable to expect companies and businesses to comply with the bare minimum standards to new legislative frameworks. It is integral therefore to ensure that the bare minimum requirements within the proposed Modern Slavery Act will lead to victims being uncovered, slaves assisted, companies held liable and proper data captured revealing a truer extent of the problem of slavery in Australia.

The Advisory Committee of the Modern Slavery Registry Submission No 9 to the Joint Standing Committee on Foreign Affairs, Defence and Trade¹⁷, recognises that the risk of modern slavery extends to all business and not just large companies.

The Australian Government must consider no threshold to reporting – ensuring integrity and consistency with their position that there is a risk of modern slavery to all business in Australia.

If we are to curb demand for slave-based products and services, the prostitution industry in particular needs to be overhauled and placed under the microscope, we need a zero-tolerance approach to slavery in all service and raw materials supply chains, and all businesses need to be encouraged to report annually on slavery in their supply chains. The appointment of an Anti-Slavery Commissioner is integral to oversee this process and provide community education, training and awareness.

The proposed Modern Slavery Act is the next step Australia can take to support the eradication of slavery in our business supply chains, and has the opportunity to curb demand for exploitation, curb gender based violence, and to end the sex trade.

¹ California’s Transparency in Supply Chains Act 2010 does not require manufacturers to take affirmative action to detect or prevent slavery or human trafficking in their supply chains, requiring only that companies make the mandated disclosures. According to the 2015 report by Development International, of the 2126 eligible companies subject to the law in California, only 14% of companies complied fully with requirements, with a total of 85 companies remaining silent.
² UK Modern Slavery Act 2015 covers approximately 12,000 companies within its definition of company under section 54 of the Act. With no formal sanctions, the legislation has been cited as inadequate and weak. Under this Act, companies are deemed compliant
if they report that they have taken no steps to address modern slavery, even though 71% of companies believe that there is slavery in their supply chains.
³ France’ s Duty of Vigilance Law requires businesses to monitor the company’s supply chains for human rights and environment protection violations through annual publication of a risk report assessing real impact and implementation of a vigilance plan seeking to prevent human rights violations. The law covers large limited by guarantee companies, affecting approximately 200 businesses in France.
⁴ Abigail Frymann Rouch, Queen backs action against modern slavery in all Commonwealth nations, The Guardian, 11 October 2017.
⁵ Including our oblations under the Protocol to Prevent, Suppress and Punish Trafficking in Persons Especially Women and Children, supplementing the United Nations Convention against Transnational Organised Crime, Adopted and opened for signature, ratification and accession by General Assembly resolution 55/25 of 15 November 2000
⁶ Fortescue’s Board of Directors.
⁷ The Freedom Hub, Waterloo, Sydney.
⁸ According to the Global Slavery Index.
⁹ United Nations Office of Drugs and Crime Global Report on Trafficking in Persons 2016.
¹⁰ Rachel Moran – Activist and Survivor, Ireland.
¹¹ 2014 Australian Institute of Criminology Report.
¹² Julie Bindel and Liz Kelly, “A Critical Examination of Responses to Prostitution in Four Countries: Victoria, Australia; Ireland; the Netherlands; and Sweden” Child and Woman Abuse Studies Unit, London Metropolitan University, 2003.
¹³ For more information, please refer to Law Journal Article: “The incompatibility o prostitution laws with international human rights”, Andrea Tokaji’s Western Australian Jurist, 2017 Vol 8, P267.
¹⁴ Seo-Young Cho, Axel Dreher and Eric Neumayer, Does Legalised Prostitution Increase Human Trafficking?World Development, 41 (1), 2013, pp. 67-82, University of Marburg - School of Business & Economics, University of Heidelberg, London School of Economics and Political Science (LSE), January 16, 2012.
¹⁵ Julie Bindel and Liz Kelly, “A Critical Examination of Responses to Prostitution in Four Countries: Victoria, Australia; Ireland; the Netherlands; and Sweden” Child and Woman Abuse Studies Unit, London Metropolitan University, 2003.