Last week Australia’s Federal Attorney-General, Hon Michelle Rowland, announced significant reforms to Australia's modern slavery framework, including a proposed new criminal offence for large organisations that fail to prevent modern slavery in their operations and supply chains.
This announcement comes at a time when the New Zealand Parliament is considering our own legislation to establish a modern slavery reporting regime with the Modern Slavery Bill.
If enacted, the Australian proposal would go further than what is currently proposed in New Zealand’s Modern Slavery Bill.
What does the proposed modern slavery offence cover?
The proposed offence is expected to apply to organisations with annual consolidated revenue exceeding AUD $100 million and will sit alongside the existing reporting regime under Australia’s Modern Slavery Act 2018 (Cth).
Importantly, organisations will have a defence where they can demonstrate they took “reasonable steps” to prevent modern slavery. The details of what those steps will involve are expected to be developed through a consultation process. The Albanese Government has also announced its intention to introduce civil penalties and enhanced enforcement powers for non-compliance with existing modern slavery reporting obligations, and consideration of a deferred prosecution agreement scheme and remedies for victims. These reforms will be complemented by practical guidance and education initiatives to assist organisations to better identify, manage, and remediate modern slavery risks in their operations and supply chains.
These reforms represent a fundamental shift in Australia’s approach to combatting modern slavery. Since 2019, Australia’s regime has primarily focused on transparency through annual reporting. The proposed changes move closer to a due diligence model that requires organisations to actively identify, prevent and address modern slavery risks within their operations and supply chains.
The proposed offence reflects an emerging "failure to prevent" approach often used in relation to anti-bribery and corruption and economic crimes, under which liability may arise not because an organisation directly engaged in wrongdoing, but because it failed to take adequate steps to prevent it occurring within its operations or supply chains.
What does this mean for New Zealand organisations?
Australia’s proposed reforms demonstrate the broader international trend towards increased corporate accountability for human rights risks in supply chains. The Australian announcement is a reminder that regulatory expectations are increasingly moving beyond transparency and reporting towards more active management of modern slavery risks through due diligence. Regulators are increasingly expecting organisations not only to disclose modern slavery risks, but also to take demonstrable steps to identify, manage and mitigate those risks.
These developments are also occurring within the broader context of the United States imposing trade tariffs of up to 12.5% on 60 countries, including New Zealand and Australia, over alleged inaction on forced and slave labour.
For New Zealand organisations, particularly those with Australian operations, customers or supply chains, the message is clear – modern slavery compliance is increasingly becoming a governance and risk management issue rather than simply a reporting exercise.
Organisations that are already mapping supply chains, conducting supplier due diligence, assessing high-risk sectors and geographies, and maintaining appropriate governance frameworks will be better placed to respond to future legal obligations on either side of the Tasman. Organisations should consider whether their existing procurement, supplier onboarding, audit, whistleblowing and governance frameworks would enable them to demonstrate that "reasonable steps" have been taken to identify and mitigate modern slavery risks if a similar obligation were introduced in New Zealand.
Looking ahead
The announcement is likely to add momentum to calls for a stronger due diligence-based approach in New Zealand's Modern Slavery Bill.
The Modern Slavery Bill is currently before the Education and Workforce Select Committee, which is due to report back on the Bill at the end of August 2026. As currently drafted, the Modern Slavery Bill would establish annual reporting obligations for those organisations that meet the proposed reporting threshold of NZD $100 million consolidated revenue and introduce criminal and civil penalties for failing to report or for providing false or misleading information but stops short of requiring mandatory due diligence. For a full summary on what the Modern Slavery Bill currently proposes see our previous update.
Given the timing of New Zealand’s General Election, the Modern Slavery Bill is unlikely to pass its second reading before the dissolution of Parliament on 1 October 2026. This means the outcome of the Bill will be a matter for the next Parliament to decide, including whether any additional amendments are made to reflect the developments in Australia. Whether or not New Zealand ultimately follows Australia's lead, the direction of regulatory travel internationally is becoming increasingly clear.
If you have any questions about the Modern Slavery Bill or steps your organisation can be taking to address modern slavery risks, please contact one of our experts.
