Modern Slavery Reforms in Australia and New Zealand: Key 2026 Developments

This blog was originally posted on 22nd September, 2026. Further regulatory developments may have occurred after publication. To keep up-to-date with the latest compliance news, sign up to our newsletter.

AUTHORED BY KAYLEIGH DUANE, REGULATORY COMPLIANCE SPECIALIST, ADHERENT

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Key Insight

Australia and New Zealand are considering measures that could strengthen corporate accountability for modern slavery in operations and supply chains. The developments reflect a broader shift away from transparency and reporting alone towards stronger expectations around prevention, due diligence and accountability.

Table of Contents

• Introduction
• Australia Opens a Consultation on a Failure to Prevent Modern Slavery Offence
• New Zealand Private Members Bill Clears Another Hurdle
• Conclusion
• FAQ

Introduction

Following our recent webinar, Global Forced Labor Regulations: Practical Implications for Businesses, this blog takes a deeper dive into significant modern slavery developments in Australia and New Zealand.

Both countries are considering measures that could strengthen corporate accountability for modern slavery in operations and supply chains. In Australia, the Government is consulting on a proposed criminal offence for corporations that fail to prevent modern slavery, together with alternative enforcement and redress mechanisms. Meanwhile, in New Zealand, the Modern Slavery Bill has progressed following recommendations from the Education and Workforce Committee.

These developments reflect a broader shift away from transparency and reporting alone towards stronger expectations around prevention, due diligence and accountability.

Interested in Global Forced Labor Regulations? Watch our webinar-on-demand!

Australia Opens a Consultation on a Failure to Prevent Modern Slavery Offence

On 16 July 2026, the Australian Government announced plans to strengthen Australia’s modern slavery framework, including a proposed new criminal offence for failing to prevent modern slavery. 

On 21 August 2026, the Government published a consultation document to help develop the details of the proposed offence and the enforcement options. The consultation is seeking views on:

• a new criminal offence for the failure to prevent modern slavery – including its scope, application and defence;
• a possible Deferred Prosecution Agreement (DPA) scheme; and
• civil remedies for victims and survivors connected to the proposed offence.

The Consultation seeks stakeholder submissions/opinions on the legislative design of the failure to prevent modern slavery offence. The paper is divided into two parts: 

• Part A – Core legislative components of a failure to prevent offence 
• Part B – Alternative enforcement 

Part A – Proposed Failure to Prevent Offence and the Design of the New Criminal Offence Itself

A failure to prevent offence generally holds a corporation liable for misconduct committed by its employees, agents or other business associates where the corporation has not taken adequate steps to prevent that conduct. These offences are particularly relevant in complex corporate structures and cross-border operations and have most commonly been used to address economic crimes such as bribery and fraud.

The purpose of this model is to encourage companies to take a proactive approach to risk management. It incentivises them to strengthen their compliance systems and governance arrangements while providing authorities with an additional enforcement mechanism.

A recent example in Australian law is section 70.5A of the Criminal Code, which concerns failure to prevent foreign bribery. Although a modern slavery failure to prevent offence could share some features with the foreign bribery model, there are important differences. Foreign bribery is typically committed by a corporation or its associates for the corporation’s benefit. Modern slavery may also involve exploitation for economic gain, but it is fundamentally a serious human rights abuse that causes direct harm to victims and survivors. 

The Government is consulting on nine components of the proposed offence:

1. Application of the Offence – It is proposed that the offence will apply to corporations with an annual consolidated revenue over $100 million. It is proposed that it would not directly apply to directors or other office holders within a corporation. 
2. Underlying Criminal Conduct – Proposed to be aligned with the specified types of modern slavery that are criminalised under Divisions 270 and 271. 
3. Connection to a corporation’s sourced product or services – It is proposed that there should be sufficient nexus between the underlying criminal conduct and the goods services, labour or materials that form part of the corporation’s sourcing arrangements. 
4. Connection to a corporation’s conduct – It is proposed that there could be an additional link or connection between a corporation’s conduct and the underlying criminal conduct. 
5. Fault Element – It proposes three possible fault standards (strict liability, absolute liability or recklessness) could apply to the relevant physical elements of the offence.
6. Defence – The proposed defence is the reasonable steps defence. This defence would allow a corporation to avoid liability by demonstrating that it took reasonable measures to prevent modern slavery in its operations and supply chains. The defence is intended to encourage proactive due diligence and effective risk management while protecting corporations that have implemented appropriate preventative measures. 
7. Guidance – The responsible Minister shall issue guidance to assist corporations to take action to tackle modern slavery in their supply chains. The guidance shall outline key principles with practical examples. 
8. Penalty – It is proposed that the maximum penalty for the offence could be set as a fixed maximum penalty (100,000 penalty units), three times the value of the benefit obtained from the offending conduct or if the value of the benefit cannot be determined, 10% of the corporation’s annual turnover during the relevant turnover period.
9. Commencement – It is proposed that commencement should be delayed for a period of 12-18 months to give corporations time to implement any changes required in accordance with the guidance.

Part B – Alternative Enforcement 

Part B seeks stakeholders’ views on measures to support accountability, remediation and redress alongside the proposed failure to prevent modern slavery offence. These include a Deferred Prosecution Agreement (DPA) scheme and potential civil remedies. The measures are intended to address non-compliance, encourage corporate cooperation and corrective action, facilitate redress for victims where appropriate, and incentivise businesses to strengthen their systems for preventing modern slavery. The consultation seeks feedback on the potential benefits, risks and practical implementation of these approaches. 

Deferred Prosecution Schemes (DPAs)

A Deferred Prosecution Agreement (DPA) offers an alternative to a contested prosecution by allowing a criminal matter to be resolved through a negotiated agreement between prosecutors and a corporation. Under a DPA, criminal proceedings are suspended for a specified period while the corporation complies with agreed conditions. These could include strengthening governance and compliance systems, remedying harm, compensating affected individuals where appropriate, and cooperating with related investigations. If the corporation fulfils the conditions, the prosecution may be discontinued or not pursued.

The consultation gives an example of the following criteria that could apply before DPA negotiations begin:

• There is reasonable suspicion that the corporation committed an offence.
• There are reasonable grounds to believe that further investigation would establish a realistic prospect of conviction.
• Pursuing a DPA, rather than prosecution, is in the public interest.

In a Modern Slavery context,  Deferred Prosecution Agreement (DPA) scheme could accompany the failure to prevent offence as a practical and proportionate enforcement option. Instead of proceeding immediately with prosecution, a DPA would allow a corporation to acknowledge its failings, cooperate with authorities, remedy underlying problems and strengthen its systems to prevent future harm. 

Civil Remedies 

Stakeholders are also invited to consider the extent to which existing civil remedies may provide appropriate avenues for redress in connection to the proposed failure to prevent offence. This is to better understand stakeholder perspectives on the applicability, effectiveness and accessibility of the existing civil remedies in this context. The consultation is also seeking opinions on any enhancements that could be made in relation to redress for victims and survivors. 

This Consultation is open until 25 of September.

New Zealand Members Bill Clears Another Hurdle

This Bill was first introduced in February 2026 and  jointly sponsored by two members (Belich and Fleming) with the purpose to implement a statutory framework to strengthen and coordinate actions to combat modern slavery. On 30 August 2026, the Education and Workforce Committee recommended that the Bill be passed, with its Second Reading now the next stage. 

This Bill requires reporting entities to report on how they identify, address, mitigate, and remediate incidents of modern slavery within their operations and supply chains. It creates offences for failing to meet the reporting requirements.

The Bill would apply to entities with consolidated annual revenue exceeding NZ$100 million. In-scope entities would be required to:

• prepare and publish an annual modern slavery statement outlining their corporate structure and supply chains;
• identify actual or potential modern slavery risks within their operations and supply chains;
• describe the steps taken to prevent, address, and mitigate those risks, including how the effectiveness of those measures is monitored; and
• submit the statement to a publicly accessible register.

The Education and Workforce Committee has also proposed some important changes to make the regime more workable, including:

•  Retaining the NZ$100 million revenue threshold, but requiring it to be met for the previous two accounting periods
• Greater alignment with Australia’s modern slavery regime
• A consolidated modern slavery statement for the public sector
•  Future statutory reviews that could consider mandatory due diligence and an independent Anti-Slavery Commissioner

The Committee also noted that submitters expressed differing views on whether the Bill should include offences and penalties. The proposed civil and criminal sanctions represent a key difference between Australia’s current framework and the regime contemplated by the Bill. However, given the Australian Government’s recent announcement that it intends to introduce civil and criminal penalties under its modern slavery framework, the Committee considered that New Zealand’s regime was unlikely to remain out of step with Australia by the time it entered into force.

As the details of Australia’s proposed enforcement framework remain uncertain, the committee recommended that the bill’s offence and penalty provisions be modelled broadly on New Zealand’s climate-related disclosures regime. The proposed provisions include:

• An offence for providing materially false or misleading statements or information.
• Liability for directors or senior managers. 
• Pecuniary penalties. 

The committee also recommended that an offence should arise only where a person knowingly provides information that is false or misleading in a material respect. This would ensure that minor errors or omissions are not treated as offences.

Conclusion

The developments in Australia and New Zealand signal a broader shift from voluntary transparency towards stronger prevention, accountability and enforcement. Although neither proposal is yet law, businesses should begin reviewing their supply-chain due diligence, governance and reporting processes.

In particular, companies should ensure that modern slavery risks are identified and addressed, responsibilities are clearly allocated, and preventative measures are properly documented. Taking these steps now will help businesses prepare for more demanding reporting obligations and potential civil or criminal consequences.

Want to dive deeper into modern slavery regulations across the globe? Check out our blogs to find out more about forced labor in the EU and the US.

FAQ

• What modern slavery measure is Australia consulting on?
  Australia is consulting on a proposed new criminal offence for corporations that fail to prevent modern slavery, together with a possible Deferred Prosecution Agreement scheme and civil remedies for victims and survivors connected to the proposed offence.
• Which corporations would Australia’s proposed offence apply to?
  It is proposed that the offence will apply to corporations with an annual consolidated revenue over $100 million and would not directly apply to directors or other office holders within a corporation.
• What defence is proposed for corporations in Australia?
  The proposed defence is the reasonable steps defence. A corporation could avoid liability by demonstrating that it took reasonable measures to prevent modern slavery in its operations and supply chains.
• Which entities would New Zealand’s Modern Slavery Reporting Bill apply to?
  The Bill would apply to entities with consolidated annual revenue exceeding NZ$100 million. The Education and Workforce Committee proposed retaining that threshold but requiring it to be met for the previous two accounting periods.
• What penalties are proposed under New Zealand’s Bill?
  The proposed provisions include an offence for providing materially false or misleading statements or information, liability for directors or senior managers, and pecuniary penalties. The committee recommended that an offence should arise only where a person knowingly provides information that is false or misleading in a material respect.

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