New Zealand next on deck for corporate modern slavery reporting

Last summer, we wrote about the New Zealand government’s consultation on corporate modern slavery legislation. On Friday, the government announced that it will be introducing legislation. Here’s some of what we currently know:

• Organizations with over NZ$20 million (approximately US$12.3 million, £9.6 million and A$18.5 million) in revenue will have a reporting requirement. This threshold is substantially lower than the reporting thresholds under the California, UK and Australian modern slavery acts. Canada’s new modern slavery transparency legislation has a two-of-three threshold, but the revenue component also is substantially higher than the New Zealand proposal, at C$40 million (approximately NZ$49 million). Given the low reporting threshold, many U.S.-based and other multinationals doing business in New Zealand are expected to have a reporting requirement.
  
  
• Subject organizations will be required to report on the actions they take to address modern slavery risks in their operations and supply chains.
  
  
• Reporting will be via a public register. This is the approach taken by both Australia and Canada.
  
  
• There will be penalties between NZ$10,000 and NZ$200,000 for non-compliance.
  
  
• Based on a public statement by a trade union, it appears that the legislation will not include a due diligence requirement. Last year’s consultation proposed a due diligence requirement for larger companies. As outlined in the consultation, large enterprises would have been required to undertake due diligence to prevent, mitigate and remedy (1) modern slavery in their domestic and international operations and supply chains and (2) worker exploitation in their domestic operations and supply chains.

Legislation still needs to be drafted, which is expected to take approximately six months. The legislation will then need to be approved by Parliament.