In a landmark legal challenge that could redefine corporate accountability in Australia, retail titan Kmart is facing federal court action over alleged failures to comply with the nation's modern slavery laws.
The Australian Border Force (ABF), acting as the regulator, has initiated proceedings against the discount department store. The core allegation is that Kmart's mandatory Modern Slavery Statement for the 2021 financial year did not meet the legal standard required by the Modern Slavery Act 2018.
The Heart of the Allegations
The ABF's case centres on the claim that Kmart did not conduct reasonable due diligence across its vast and complex international supply chain. The legislation mandates that large companies must proactively investigate and report on potential risks of forced labour, human trafficking, and other exploitative practices within their operations and suppliers.
It is alleged that Kmart's statement was deficient because it failed to properly:
- Identify and assess actual and potential risks of modern slavery practices occurring.
- Take appropriate remedial action and implement measures to assess and address those identified risks.
- Provide a comprehensive account of the due diligence processes undertaken throughout its supply chain.
A Test Case for Corporate Australia
This lawsuit represents the first major test of Australia's modern slavery legislation since it came into effect. The outcome is being closely watched by businesses, legal experts, and human rights advocates nationwide.
A successful prosecution by the ABF would send a powerful message to thousands of companies reporting under the act, underscoring that mere compliance on paper is insufficient. It would establish a precedent that robust, verifiable, and continuous action is legally required to combat modern slavery.
For Kmart, a household name with a massive consumer footprint, the case also carries significant potential for reputational damage. It places its ethical sourcing policies and commitment to social responsibility under intense public scrutiny.
What Happens Next?
The matter is now before the Federal Court of Australia, which will examine the evidence and determine whether Kmart breached its statutory obligations. The court has the power to demand that a company prepare a new, compliant Modern Slavery Statement.
This case highlights the increasing global pressure on multinational corporations to ensure their supply chains are free from exploitation. It signals a shift from voluntary ethical guidelines to enforceable legal standards, holding businesses directly accountable for human rights abuses occurring within their commercial networks.
