The modern slavery due diligence gap every manufacturer needs to close
- Jakes Mantle
- May 28
- 5 min read
A Victorian kale grower allegedly owed twenty workers more than $260,000 in unpaid wages. The grower supplied two of Australia's largest supermarket chains. Both supermarkets ran their own modern slavery audit programs, but without effective modern slavery due diligence, significant issues remained undetected. The labour hire firm that paid the workers, and didn't pay them properly, sat one tier below the grower. It was out of sight of every retail compliance check above it.
This is not an Australian problem; it is a human rights issue deeply embedded in global supply chains. It is a pattern repeated in every country that runs a large agricultural, manufacturing or services supply chain. The United States has cases involving farm labour contractors, the United Kingdom has cases inside garment factories, and the Gulf has cases on construction sites. The shape is always the same. A buyer audits its tier one supplier. The wage theft, the passport retention, the coerced overtime, all of it happens one or two tiers below where anyone is looking.
If you sell into a major retailer, run a global manufacturing supply chain, or buy services through any labour hire firm anywhere in the world, your exposure and risk management challenges are the same. The audit you commissioned last year almost certainly did not reach the layer where the harm sits.
The modern slavery due diligence gaps your ERP should be doing
Standard modern slavery audits run on documents. The tier one supplier sends a self-assessment. An auditor visits the head office. Policies get read. Boxes get ticked. None of that touches the labour hire firm further down the chain.
In horticulture, the labour hire firm is often the actual employer of the workers. The grower books labour by the day. The firm hands out the wages, manages timesheets, and houses the workers. If wages get withheld, that is where it happens. If passports get held, that is where it happens, too. The grower's audit will not show any of the sub-tier supplier risk involved. The retailer's audit of the grower will not show it either.
Australia's Fair Work Ombudsman has filed 171 cases against employers involving visa holder workers in the eight years to June 2025, recovering $39 million in penalties. That is only what surfaced. Nobody believes the figure is the full picture. The NSW Anti-Slavery Commissioner and the UN Special Rapporteur on Contemporary Forms of Slavery have both flagged the Pacific Australia Labour Mobility scheme as a sustained modern slavery risk. The same pattern shows up in meat processing, cleaning, care work, and construction.
Globally, Walk Free estimates fifty million people are living in modern slavery right now, highlighting the urgent need for modern slavery due diligence across all industries. The International Labour Organisation puts the figure in a similar range. A meaningful share of that population is producing goods that sit on retail shelves in Sydney, London, New York and Singapore.
Your ERP is the one system in your business that already holds the data needed to see further than an audit can. It records who you pay, how you pay them, when supplier behaviour shifts, and which suppliers carry which licences. The audit gap closes when the ERP is configured to show those patterns instead of just storing them.
The unseen corners of supply chains
The signals are in the data, not the documents. They are sitting in your own systems already.
Look at how the labour hire firm gets paid. Are invoices climbing while the supplier's headcount is flat? Is the firm asking for cash, or for payment to accounts that are not in the firm's registered name? Is the supplier paying the firm, but the firm has no payroll system that reconciles wages to bank deposits? Are there suppliers in the master data with no business number history, no licence record, no audit trail of when they were onboarded? Are payment terms moving outside policy without an exception note?
These are the same patterns finance teams already watch for in fraud and tax work, emphasising the importance of due diligence. The patterns also signal modern slavery and human trafficking risk. The Victorian kale case fits the shape. Twenty workers, $260,000 owed, all paid through a labour hire firm. Somewhere in someone's accounts payable ledger, the warning signs were sitting in plain view.
The reason most companies miss them is not a technology problem. It is a configuration problem. The fields are not set up to flag the right things. The reports are not built to compare labour hire spend against actual worker counts. Nobody owns the modern slavery due diligence or the exception list.
How to configure your ERP for modern slavery regulatory compliance
Syspro is an ERP. It runs the financial and operational backbone of manufacturers and distributors. Out of the box, it has the components you need. There is:
A supplier portal that holds supplier master data and licence information
Lot and batch traceability that follows a product back to its source.
Purchase to Pay process with exception reporting on payment patterns
An audit trail on every transaction,
An open integration framework that pulls in external risk data, including labour hire licensing registries.
What Syspro does not do on its own is decide which exceptions matter for modern slavery, or build the supplier hierarchy that mirrors your actual sub-tier exposure.
That is the work TecOpti does. We configure the supplier master to capture labour hire status, licence numbers and renewal dates. We set the AP exception rules that flag cash heavy payments to small suppliers, fast invoice growth without matching headcount, and missing audit data. We build the supplier hierarchy so a buyer can see two tiers below their direct supplier in a single view. We produce the board level compliance reports that an auditor, a regulator or a retail partner will accept as evidence.
This is what the four TecOpti pillars protect.
Precision in the data. Quality in the supplier base.
Compliance with the modern slavery due diligence and laws of every market you sell into.
Quality in your supplier base information and management processes
Resilience when a regulator, auditor or supplier asks for evidence.
Strengthening Corporate Responsibility through your ERP
On 30 January 2026, Australia's National Anti-Slavery Commissioner released an issues paper recommending mandatory, risk-based modern slavery due diligence for reporting entities, and a high-risk declaration mechanism that would force buyers to act on flagged products and industries. The European Union's Corporate Sustainability Due Diligence Directive is on the same path. Canada's Forced Labour Act has been in force since 2024. The United States is using customs enforcement to block goods linked to forced labour at the border.
The standard is moving from describing what you did to proving what you did. A general statement about supplier audits will not pass. Your suppliers will be asked for evidence, ensuring modern slavery due diligence is thoroughly documented and addressed. They will need to show the data they collected, the exceptions they reviewed, and the actions they took on the back of it.
The evidence will come from your systems. Spreadsheets and PDF reports will not survive a regulator's request. The companies that pass the new test are the ones with their supplier data, their payment data, and their exception data sitting in one ERP, ready to produce on demand.
That is what being prepared for what is next, with a focus on ethics, means.
Modern slavery due diligence in 2026 will be evidenced from your systems
The Victorian kale case is not unusual. It is what the system produces when a buyer relies on tier one audits and ignores the layer below. The fix is not another audit. It is configuring the ERP that already holds the data, so that risk assessment warning signs surface before your compliance reports fails.
Can your ERP demonstrate effective contract management, precision in supplier data, quality in your supplier base, compliance with the laws you report under, and resilience under a regulator's request? If not, contact TecOpti.
Book a chat | or call TecOpti on +61 1300 832 678
