The United States is threatening to impose trade tariffs of up to 12.5 per cent on 60 countries, including Australia, over their inaction on forced and slave labour worldwide.
On Wednesday, US trade representative Jamieson Greer said:
“The failure of our most important trading partners to address the importation of goods made with forced labor is unacceptable.”
Prime Minister Anthony Albanese responded that a new tariff on exports to the US was “unjustified”, as Australia has “robust, comprehensive and world-leading legislation addressing forced labour and modern slavery”.
Who’s right? And are the US claims about other nations turning a blind eye to forced and slave labour – where a person is either forced to work, or even owned by someone else – actually true?
Which countries face new tariffs
In a new report released by the US Trade Representative, 54 countries – including Australia, China, New Zealand and Britain – were found to have:
failed to impose a legal prohibition on the importation of goods produced wholly or in part with forced labour and to effectively enforce such a prohibition.
All face a proposed 12.5 per cent tariff on their exports to the US.
Another six economies – including Canada, the European Union and Indonesia – face lower 10 per cent tariffs. They were seen to have done more overall, but failed to effectively enforce their own laws.
Forced labour is a form of modern slavery, defined under international law as “all work or service which is exacted from any person under the threat of a penalty and for which the person has not offered himself or herself voluntarily”.
This definition is consistent with an almost century-old US law, Section 307 of the US Tariff Act of 1930. It’s being used to legally justify this latest round of tariffs.
The US has a strong history of taking legislative action against forced labour. Section 307 prohibits imports of goods mined, produced or manufactured by forced labour.
In 2022, the US also established the Uyghur Forced Labor Prevention Act, prohibiting goods being imported from China’s Xinjiang Uyghur region, where there are “credible” allegations of widespread forced labour.
These proposed forced labour tariffs appear to be less about labour rights and more about trade.
This latest move comes after US courts blocked US President Donald Trump’s sweeping international tariffs announced over the past year. That prompted Trump to pledge:
“We get one ruling, and we do it a different way.”
As former Australian ambassador to the US Joe Hockey said about the new forced labour tariff on Thursday, “America is running out of money and they need to get it from somewhere”.
These tariffs are still subject to public consultations over the next month.
While using tariffs as a way to strengthen action on forced labour is questionable, there is some substance behind the US allegations.
41,000 people in Australia alone
An estimated 50 million people around the world – and rising – are trapped in modern slavery, more than half of those in forced labour.
Australia is estimated to have more than 41,000 people working as forced labourers or other forms of modern slavery, including child marriages.
Reports to the Australian Federal Police of human trafficking have nearly doubled in the past five years.
Australia’s laws are not world leading
In 2018, Australia established its Modern Slavery Act. This law was hailed as a critical first step in acting on modern slavery.
The law requires large business to report annually on the risks of modern slavery in their operations and supply chains.
Since 2019, more 17,000 modern slavery statements from more than 27,000 businesses have been lodged on Australia’s modern slavery registry.
Yet in 2023, an independent report found:
There is no hard evidence that the Modern Slavery Act in its early years has yet caused meaningful change for people living in conditions of modern slavery.
That’s not surprising: There is no enforcement built into the law.
What more needs to be done?
If Australia does want to have “world-leading” laws – and a stronger case to argue for lower US tariffs – what needs to change?
While the Modern Slavery Act has raised awareness of the problem in Australian boardrooms, it is not improving the working conditions of supply chain workers, here at home and overseas.
So Australia needs to move quickly to strengthen that law with enforcement, and establish a forced labour import ban.
A 2023 review of the Modern Slavery Act recommended penalties for companies failing to comply with reporting requirements and the introduction of a human rights “due diligence obligation” – similar to European Union laws and emerging requirements in South Korea, Thailand and Indonesia.
This sees companies working to reduce human rights harms not just in their own factories, but through their suppliers’ suppliers too.
The Albanese government partially accepted some of the 2023 report recommendations, including the need for penalties. Three years on, it’s failed to take serious action.
The Australian government should also establish a forced labour import ban, like one the EU passed two years ago, now being phased in across all 27 member states. This would stop specific goods suspected of being produced with forced labour at the border.
Whether these proposed tariffs come into force or not, this new US forced labour investigation could actually do some good.
Right now, millions of people are working in dangerous, dehumanising conditions to make goods sold in Australia and worldwide. It’s long overdue to do more to stop it.
Justine Nolan is Professor of Law and Justice and Director of the Australian Human Rights Institute at the UNSW Sydney.
