E19 Transcript

Modern Slavery - With Martijn Boersma

E19 Transcript


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Transcript Commences

**Chris Patterson: 00:06**

Hello and welcome to the Law Down Under Podcast with barrister Chris Patterson. We will give you insights into the law in New Zealand and Australia, its application, and the law's future. Each episode features a new guest who will inspire your interest in the law and give you a greater understanding of the legal issues that helped shape our justice system here down under. We thank you for tuning in and enjoy the podcast. On the podcast today, I am joined by Martijn Boersma, an associate professor at the University of Notre Dame in New South Wales. His research focuses on issues related to corporate governance, gender, diversity, leadership, employment relations, labor standards, and modern slavery. Martijn holds a master's degree in the Science and Arts from the University of Amsterdam and a PhD in management from the University of Technology, Sydney, where he was also a senior lecturer. He's previously worked for the United Workers Union. The Australian has chief Greenpeace International in 19 and 2019. He co-authored addressing modern slavery with Dr. Justine Nolan, a book that has been endorsed by Amnesty International, former US Secretary-General Ban Ki-moon, and the New South Wales interim anti-slavery Commissioner Jennifer Boone. Good afternoon, and hello, Martijn. How are you?

**Dr. Martijn Boersma: 01:26**

I'm good, Chris. How are you?

**Chris Patterson: 01:27**

I'm doing amazing. Thank you. Now you're in Sydney today. I am too. Okay, what's happening in Sydney? Is there anything exciting? What's the weather like?

**Dr. Martijn Boersma: 01:36**

Weather's good, apart from that. You know, it's Thursday. So we're over halfway. So it's good. We're on the way to the weekend.

**Chris Patterson: 01:42**

It's Friday Eve.

**Dr. Martijn Boersma: 01:44**

Oh, sorry. It's Friday. All right.

**Chris Patterson: 01:46**

That's it. It's great to have you on the podcast. Now today, we are going to get into the very serious topic of modern slavery. And you've done quite a lot of work, in fact, super impressed with the level at which you've looked at this. But this is an international issue. It's not just an Australian New Zealand issue, correct?

**Dr. Martijn Boersma: 02:05**

Right. Yeah. So globally, there are an estimated 40.3 million victims of modern slavery currently. And of those, about 15 million are trapped in forced marriage, and about 16 million are trapped in forced labor related to the private economy. So that's the type of forced labor that's connected to companies, for example, in New Zealand or in Australia. And then there's a sort of the remainder of victims are, for example, subjected to the worst forms of child labor, including child slavery and other forms of labor exploitation.

**Chris Patterson: 02:47**

That's quite the core. Beyond that, they're the people that are associated with modern slavery. So they're the people that are organizing it. And there's the recipients, of course, the consumers. I mean, we go and buy products or services that have been tainted by modern slavery. So I guess this affects a lot more than just 40 million people in the world.

**Dr. Martijn Boersma: 03:11**

Oh, absolutely. And I think that type of awareness has really grown following the introduction of the modern slavery Act in Australia. Obviously, before that, we saw the introduction of the Modern Slavery Act in 2015 in the UK, and obviously, New Zealand is considering introducing its own Modern Slavery Act. I think that type of awareness-raising activity has really, I think, cemented within the mind of the consumer the fact that, you know, when they put the Nutella on the bread, it's a question of, you know, where do the hazelnuts come from? Or under what conditions is the palm oil sourced that's in the Nutella, you know, where does the chocolate come from? So this is just to name one item, but obviously, the same goes for electronics that you use every day. There's this whole wide range of items that you are in touch with every day that have the potential to be produced by means of forced labor.

**Chris Patterson: 04:18**

Okay, well, that's really good. So Martijn, can we try and put some definitions? Because when we talk about slavery, I mean, the most straightforward or the immediate thought is to think of, okay, let's think of the slave states in the US in the 1860s or before, where you've got predominantly West African workers who have been forcibly taken to the United States or even the Caribbean, because the English were pretty involved in the slave trade then. And so that's the picture that someone has in mind of a slave. How do we define that now in 2022? What does modern slavery look like? How do we define it?

**Dr. Martijn Boersma: 05:15**

That's a very good question, Chris. Defining slavery is actually not a very helpful term, exactly for the reason that you just pointed out. It conjures up these notions of, let's say, traditional slavery or the transatlantic slave trade that you just described. Now, with modern slavery, there are basically two main differences between modern slavery and traditional slavery. Traditional slavery revolved around a legal ownership relationship between a master and a slave. As a slave, you were the legal property of your master. Obviously, today, in today's age, slavery has become more covert. We don't have that legal ownership element in the definition anymore. It's no longer about ownership, but about illegal control that people exercise over those who are being exploited. That's a very important distinction to make. Secondly, there's no longer a market where slaves are bought and sold. With the transatlantic slave trade, there were auctions where people could be bought to perform labor. In today's day and age, you don't have a market like that. People become trapped in slavery for various reasons, such as precarity, immigration status, desperation, and exploitation by those taking advantage of their situation. The definition of modern slavery is effectively an umbrella term, encompassing forced marriage, forced labor, child slavery, debt bondage, and other forms of exploitation. This can be less relevant to companies, especially in New Zealand, which already have companies reporting on slavery in Australia, where forced labor related to the private economy is more common. Additionally, it's important to consider that people can move along a spectrum of exploitation. For instance, people may start with decent work conditions but due to external factors, their conditions may deteriorate, and they lose control over their work.

**Chris Patterson: 09:16**

So it sounds to me like it's more of a spectrum, and you can move across that. As I mentioned before, if we take the classical notion of a slave operating in a slave state in the United States during the mid-1800s, they weren't being paid, and their owner provided accommodation, food, and met their basic needs. In contrast, in 2022, an employer who abuses the employment relationship may not be paying a living wage, and the worker may not be any better off and could be worse off. Are we progressing beyond a scenario where we had the American Civil War, where 620,000 people died fighting over this issue? Are we two centuries ahead, actually moving forward?

**Dr. Martijn Boersma: 10:52**

That's a good question. There are indeed parallels between slavery in the Americas and modern slavery, but it's essential to note that the element of control remains constant. Ancillary services provided by an employer, such as accommodation, food, and transportation, are used to control the worker. If your employer controls where you live, what you eat, and how you get to work, they can exercise more control over you. This control can also extend to deducting these services from your wages. Ancillary services have remained an element of control in modern slavery.

**Dr. Martijn Boersma: 12:18**

Absolutely. This is quite a common way for people to become ensnared in modern slavery through debt bondage. Initially, individuals are told they will make a certain amount of money per hour, day, or week. They may think this sounds good, but then it turns out that all the money is being withheld for transportation, food, and accommodation. This may not be enough to pay off a recruitment fee they owe for the job or other debts they might have. This keeps them paralyzed, as they might not even be able to cover potential interest on that recruitment fee. These are various illegal control strategies that exploiters employ to trap people in modern slavery. This emphasizes the difference between illegal control and legal ownership.

**Chris Patterson: 13:25**

Is this a fine distinction? To a large extent, does it really matter? Because it's exploitation, whether someone legally owns a person or has so much control over them that ownership becomes irrelevant. They're effectively experiencing the same level of exploitation. Are there specific industries or sectors of our economy where this is more prevalent, where it occurs more frequently?

**Dr. Martijn Boersma: 14:10**

Typically, industries with low entry barriers are more likely to have individuals subjected to labor exploitation or modern slavery. I use "low barrier of entry" to avoid the term "low-skilled labor," as that can be misleading. It doesn't necessarily require qualifications. So, for example, agriculture is one industry where labor exploitation occurs. Sweatshops in Southeast Asia, tied to fast fashion, are a significant problem. The electronics industry, including the sourcing of raw materials for electronics, is another area of concern. The mining industry, particularly artisanal mines in Africa, where workers often face dangerous conditions, is also a source of materials that end up in products we buy.

**Chris Patterson: 15:47**

So this is where Australians and New Zealanders may have indirect exposure to modern slavery because they consume or purchase goods produced somewhere along that supply chain using the definition of modern slavery that you've provided. But is there a direct risk or any examples of modern slavery occurring in Australia or New Zealand? The industries that come to mind are agriculture, where seasonal labor is needed, and construction, which requires laborers, both of which can potentially be exploited.

**Dr. Martijn Boersma: 17:32**

Agriculture and construction are indeed high-risk industries, given their high proportion of migrant workers. Migrant workers are a risk category due to their visa status. Visa conditions often come with working limitations. For instance, international students in Australia could only work a limited number of hours per fortnight. They often end up working more to make ends meet, and exploiters may threaten them with visa breaches to exert control. For many of these people, coming to Australia or New Zealand represents an opportunity for a better life, but they may be vulnerable due to their desire to stay and the exploiter's control over their visa status.

**Dr. Martijn Boersma: 19:26**

Absolutely. This is indeed a problem, and there was a recent report that described the agricultural industry in Australia, where many people from the Pacific Islands come under seasonal worker programs. Upon arrival, they find that they're not being paid as promised and have to pay more for accommodation than expected, among other issues. Sometimes, the term "modern slavery" is used to describe such situations, but it's not always technically accurate. Modern slavery requires people to be unable to either speak up or leave their employment. So, these are two critical elements for it to qualify as modern slavery. However, individuals can still be exploited even if they have the capacity to pack up and leave, but it wouldn't technically be considered modern slavery.

**Chris Patterson: 20:22**

Let's break that down for a moment and look at those two components. The first one is speaking up. Realistically, if you're from the Philippines or one of the Pacific Islands, far from home and your support network, and English isn't your first language, what opportunity do you have to speak up? Is it a practical ability?

**Dr. Martijn Boersma: 20:53**

That's a valid point. You can try speaking with your co-workers to see if they're experiencing similar conditions, but exploiters often limit contact with the outside world. They control access to shops, food, and transportation. Additionally, in many cases, these workers are in non-unionized worksites, so there's no union representative to turn to. The language barrier is also significant, and they might not even know all their rights in Australia. Fear of losing their job and being stuck prevents them from speaking up and leads them to accept these conditions. So when I mention using your voice and speaking up, it's more easily said than done, indeed.

**Chris Patterson: 22:49**

I'm sure an exploiter would say, "They could speak up if they want, and they can leave anytime." However, when one considers the practicalities of the matter, they can't speak up, they don't have a voice, and they can't easily leave. The alternative may be returning to a country where they were at risk, potentially meeting the criteria for refugee status due to threats to their lives. They're essentially stuck and must accept these terms because it's not a fair bargaining scenario.

**Dr. Martijn Boersma: 23:37**

Exactly. There's a significant power imbalance at play. Debt is often one of the main factors, where they've taken out loans back home just to afford coming here. They might also have recruitment fees to pay off. All of these factors make it difficult to exit that employment relationship.

**Chris Patterson: 24:07**

And part of that bond you've paid may involve handing over your passport as well, correct?

**Dr. Martijn Boersma: 24:14**

That's correct. Confiscating identity documents is a common control method. This leaves individuals with limited international travel options, which further restricts their mobility.

**Chris Patterson: 24:36**

So, we've been discussing the situation for a few minutes, focusing on the exploiters and the exploited. Where does the law come in to address this issue, which we're describing as "mischief"?

**Dr. Martijn Boersma: 25:12**

Well, there's the criminal aspect to it. Exploiting people or false imprisonment are criminal offenses, and these statutes have been in place for a long time. However, there seems to be a significant gap between having laws against exploitation and false imprisonment and their effective enforcement. Much of modern slavery remains hidden from plain sight. It's not a situation where you can spot someone being exploited on the street, call the police, and have them resolve it. Identifying cases of modern slavery is far more complicated.

**Chris Patterson: 26:06**

The exploiters, some of them, might be aware that what they're doing is wrong. So they won't publicly announce that they've brought in workers from the Philippines, pay them very little, confiscated their passports, and control them for profit. Instead, they operate in a discreet manner.

**Dr. Martijn Boersma: 27:03**

Yes, there are two ways in which exploiters operate. They can deliberately design elaborate schemes like the one you described, sourcing people from overseas and making them pay fees, among other things. Then there are opportunistic cases where people take advantage of someone's situation when they realize that the individual is unable to speak up. For instance, a cafe owner hiring someone with an expired visa who can't work legally under normal conditions. They exploit this vulnerability.

**Chris Patterson: 28:35**

The exploiters might not have planned it out carefully, but they see an opportunity and decide to take advantage of someone who can't work legally. For instance, a cafe owner hiring someone with an expired visa who can't work legally under normal conditions.

**Dr. Martijn Boersma: 29:23**

Exactly. In some other examples, you can spot these issues more easily. Take car washes, especially hand car washes, for example. You drive up, see the number of workers, consider the time it takes, and realize that it's not feasible for them to be paid a proper wage based on the price you're paying. This doesn't necessarily equate to modern slavery, but it does highlight exploitation. You can make these calculations on the spot. Moreover, you often see people from various ethnic backgrounds working at these places, which suggests they might be international students or on different visas, heightening the risk of exploitation. In the UK, there have been reports of actual modern slavery in some car washes. Nail salons are another example; the number of workers versus what you're paying often doesn't add up. They might be transported from their homes to work, often have limited English skills, and can face a higher risk of exploitation due to these factors. So, when you look at these risk factors and profiles, you can get a sense of where exploitation might occur.

**Chris Patterson: 31:56**

Using the carwash example, in a competitive environment, people make decisions based on price, which drives businesses to keep labor costs down. So, considering the mischief we've discussed and the law's response, let's talk about the Modern Slavery Act in Australia. It was modeled after the UK's Modern Slavery Act of 2015 and came into effect in Australia in 2018. Could you provide some insights into it?

**Dr. Martijn Boersma: 32:28**

Absolutely. The Modern Slavery Act in Australia is modeled on the UK's Modern Slavery Act of 2015. What it requires companies with a certain annual revenue threshold to do are essentially three things. They need to assess the risk of modern slavery in their operations and supply chains. Then, they have to outline the actions they are taking to address those risks. Lastly, they must report on the progress they're making regarding those actions.

Now, if we look at the issue of enforcement, one interesting aspect is the agency responsible for administering the Modern Slavery Act in Australia was the Australian Border Force. However, with the new government, it has been transferred to the Federal Attorney General's Department. This move alone gives insight into the various agencies involved in addressing this issue. The Border Force, for example, could potentially identify cases of people who might be trafficked for exploitation.

Regarding the Modern Slavery Act, what we've observed in several reporting rounds is that companies are struggling with their reporting. They often don't know what to look for, fail to identify concrete actions, and don't effectively monitor the progress of their actions. There's also an issue with the enforcement of this law, as it heavily relies on consumers and investors to scrutinize the statements. There hasn't been any significant follow-up by public agencies, and it lacks an anti-slavery Commissioner at the federal level in Australia.

**Chris Patterson: 35:44**

Since the Act came into force, have there been any prosecutions?

**Dr. Martijn Boersma: 35:50**

No, there haven't been any prosecutions, and that isn't the primary purpose of the law. It serves as an economic tool for companies to exert influence over their suppliers, steering them towards ethical production rather than exploitation. The challenge is that many large companies have contributed to the problem by applying downward cost pressure on their supply chains, which led to various forms of exploitation. Now they are being asked to reverse course and ensure ethically sourced products. A recent example involved Woolworths in Australia, which found instances of modern slavery in its supply chain and took action to compensate the exploited individuals. Private actors have taken some actions, but there's been a lack of follow-up from public agencies regarding the Modern Slavery Act, particularly at the federal level.

**Chris Patterson: 37:54**

The big question for me is how the effectiveness of this legislation is measured and assessed. How do we evaluate how well it's working?

**Dr. Martijn Boersma: 37:54**

That's a great question. Measuring compliance is different from measuring effectiveness. Companies can show compliance by producing glossy reports that tick all the boxes but may lack substance. There's a gap in measuring effectiveness because it takes time to see the impact of actions. Many companies are unfamiliar with the issue and don't know what they should be looking for. Modern slavery is often hidden from sight, making it challenging to address. Smaller organizations that meet revenue thresholds for reporting may not have the resources to dedicate to this problem compared to larger companies. These factors make it difficult to provide a straightforward answer regarding the impact of the Act. It isn't making the significant impact many hoped for.

**Chris Patterson: 40:07**

It seems like the Modern Slavery Act may not meet the aspirations of those who pushed for it. Is there a risk of tokenism? A situation where it's just seen as ticking a box, and then everyone moves on without genuinely addressing the underlying problem?

**Dr. Martijn Boersma: 40:26**

Yes, indeed. Many people have referred to it as a tick-box exercise. I often draw a parallel with the Workplace Gender Equality Act in Australia, which came into effect in 2012. Both Acts share a similar enforcement principle – companies must show what they are doing to facilitate female career progression and reduce the gender pay gap. They report these efforts annually. The underlying idea for enforcement is the same: consumers and investors could shift their support if they think a company isn't doing well on these issues. However, since 2012, we've seen the gender pay gap reduce at a glacial pace, and there hasn't been a significant increase in the number of women in senior management positions or on corporate boards. If the Workplace Gender Equality Act is any indication of the change we might see from the Modern Slavery Act, it's not particularly promising.

**Chris Patterson: 42:15**

Now, let's discuss the United Nations Protocol of Forced Labor Convention 2014 and how it fits into Australian modern slavery legislation.

**Dr. Martijn Boersma: 42:15**

Australia ratified that protocol earlier this year, which brought its modern slavery approach in line with other international efforts. Interestingly, Australia was one of the last countries in the Asia-Pacific region to ratify this protocol, so better late than never. What the protocol does is set due diligence requirements. Currently, there are no due diligence requirements on Australian companies regarding modern slavery in their supply chains. They're only required to address the risk. There's no mandated description of the steps they should take to ensure that their goods and materials aren't produced through forced labor. The ILO protocol provides that due diligence approach and harmonizes approaches across different jurisdictions. This is vital because it's a global problem. Having a harmonized approach across borders helps ensure that we're all measuring the same issues. International coordination is crucial, especially for addressing cross-border modern slavery issues.

**Chris Patterson: 45:49**

It's essential to consider the impact of globalization on labor, where companies often move their production to different countries for cost savings. The automotive industry, as an example, experienced significant changes with companies relocating their labor-intensive operations to other countries. This shift can have severe consequences for cities heavily dependent on a particular industry. For instance, Detroit faced significant economic challenges when the automotive industry moved its operations elsewhere. The globalization of labor has shaped many global economies, and it's important for countries like Australia and New Zealand to take responsibility in addressing these issues.

**Chris Patterson: 47:10**

Lastly, New Zealand has outlined a plan of action against forced labor, people trafficking, and slavery, setting out 28 actions until 2025. However, these plans often remain aspirational and might not fully come to fruition. New Zealand is also looking to implement the international commitments under the Forced Labor Protocol but faces challenges when trying to address these issues. Local initiative and responsibility are crucial because international pressure alone doesn't guarantee action.

**Dr. Martijn Boersma: 47:46**

You're absolutely correct. Local initiative and responsibility are crucial in making these commitments and aspirations a reality. International pressure can only do so much, and it's the countries themselves that need to take the initiative and make meaningful change.

**Dr. Martijn Boersma: 48:18**

You're absolutely right, and I think it's very important that New Zealand is making these commitments. However, turning these commitments into action is a different story. The process can be quite time-consuming. There are consultations required to build the legitimacy and take meaningful actions. In the UK, Australian Modern Slavery Act, and now in New Zealand's proposed legislation, the reporting requirements are generally not too onerous. It's not about imposing excessive red tape on companies, which is often a concern from the business lobby. The proposed New Zealand legislation takes a staggered approach, requiring companies with significant revenue thresholds to undertake mandatory due diligence of their supply chains. Smaller companies might have lower revenue thresholds and face less onerous requirements. I believe this is a forward-thinking approach because it acknowledges the resource constraints faced by smaller organizations while holding larger companies with greater revenues to a higher standard. It's crucial that these larger companies can allocate resources to make substantive changes rather than superficial ones.

**Chris Patterson: 51:11**

It's an excellent starting point to focus on larger companies with reporting obligations because it provides more transparency. It's easier to see how these big organizations operate, generate revenue, and deal with these issues. However, a significant part of the economies in New Zealand and Australia consists of smaller businesses, often employing fewer than five people. These businesses might import goods produced through modern slavery, but they lack the same reporting obligations as large companies. The challenge lies in addressing this part of the economy.

**Dr. Martijn Boersma: 52:04**

Absolutely, and there's a debate about whether lowering revenue thresholds is the solution to get more entities to report on modern slavery. The concern with lowering the thresholds is twofold. First, you must consider whether it will help identify and remediate more instances of modern slavery, especially considering the resource limitations of smaller businesses. Second, a significant reduction in revenue thresholds might lead to a spike in non-compliance as smaller companies struggle to understand and adhere to the act. In the long run, the step-by-step approach makes sense. As the public becomes more aware of these issues, smaller businesses will likely think twice before sourcing goods from regions and industries associated with forced labor. There are resources available, such as the U.S. Department of Labor's report on high-risk goods and their sources. If something seems too cheap to be true, there's likely someone paying the price somewhere in the supply chain. The responsibility should be shared, but larger companies can lead by setting a good example for the rest.

**Chris Patterson 54:50**

What well, it does and I'm minutes example setting so that I guess to a degree, you know, from from corporate culture point of view We there needs to be a real and not only to deterrence factor that the law can have the bat, you know, leading from the front to say, it's not okay to to be an exploiter and in any way whatsoever, and it's companies who are able to, to walk the walk, talk the talk, and actually prove that that are likely to, I guess, you know, you know, when the admiration of of of the consumers, the customers, the clients, hopefully the shareholders will look beyond the bottom line of profit and say, I don't want to be involved in a business. That's, that's an exploiter? Well, look, this has been a fascinating discussion and an insight into modern slavery and its impact on Australia and New Zealand. So, you know, I really do want to sincerely thank you so much for baguette for giving us the benefit of your experience and wisdom and knowledge in this area, Martine. It's, it is fascinating. It's an area that I suspect, we will see more development as time goes by, because this is a developing area, you know, the modern slavery act in Australia 2018, New Zealand's movement towards adopting the international protocols. And it's an area where, of course, like a lot of legislation, which is trying to deal with, you know, a mess, Jeff needs to find shown as those people who tend to try and exploit the legislation will look for the angles to get around it. So you know, Martijn Boersma. Thank you very much for joining me, on the lowdown on the podcast. It's been an absolute pleasure.

**Dr Martijn Boersma 56:47**

Thank you, Chris. Thanks for having me.

**Chris Patterson 56:48**

Thank you for tuning in and listening to this episode of The Law Down Under podcast. You're welcome to join in on the discussion via my podcast page, which you can access at patterson.co.nz. That's patterson.co.nz. Thanks for supporting the podcast and tune in again for more on the law, its application and the future of the law here down under.