Kmart Australia is facing legal action over alleged links between its product supply chain and forced labour in China’s Xinjiang Uyghur Autonomous Region – which the retail giant has strongly denied.
The Federal Court action, brought forward by the Australian Uyghur Tangritagh Women’s Association (AUTWA), seeks disclosure of documents relating to two factories listed in Kmart’s 2024 and 2025 supplier lists.
The advocacy group claims that reports connect these factories to forced-labour practices involving Uyghur workers, which has raised concerns about whether Kmart has been sourcing goods from suppliers implicated in modern slavery.
According to the AUTWA, systemic state-sponsored forced labour and other atrocities against Uyghur and other Turkic Muslim people are “well-documented” in Xinjiang, which sits in north-western China.
The legal claim argues that, by promoting its products as ethically sourced while potentially benefiting from factories linked to forced labour, Kmart may have engaged in misleading or deceptive conduct under Australian Consumer Law.
“This is a significant day for the Uyghur Australian community. We’re demanding answers from Kmart, so we know whether its actions live up to its words about addressing forced labour risks in its supply chain,” said Ramila Chanisheff, President of the AUTWA.
“Kmart, and all companies, must ensure they are not profiting from forced labour in China. China’s mass imprisonment, repression and forced labour of Uyghur people is well-documented. Our community has lost family members, friends and loved ones because of China’s brutal treatment of Uyghurs.
“Kmart is a go-to store for so many people in Australia. If the company has profited in any way from this sort of systematic repression, I am sure Australians would be horrified.”
Jennifer Kanis, Principal Lawyer at Maurice Blackburn – who is representing AUTWA alongside the Human Rights Law Centre – said the case is the first of its kind in seeking to bring real accountability home to Australian retailers in relation to the risk of Uyghur forced labour infecting their supply chains.
“Kmart tells customers that it supports ethical sourcing and the protection of human rights – but we know there are credible links between two of its factories/suppliers and the use of Uyghur forced labour in Xinjiang,” she said.
“Kmart must be transparent about its potential links with Uyghur forced labour, and the Court will be asked to compel Kmart to hand over information about what due diligence it has conducted on suppliers with links to Xinjiang.”
Kmart has strongly denied any wrongdoing, highlighting that it has operated an Ethical Sourcing Program for over 15 years, designed around a strict compliance framework that references International Labour Organization conventions and United Nations human-rights principles.
The Wesfarmers-owned company, which operates over 300 stores in Australia and New Zealand, also points to its routine supplier audits, which are a requirement for all factories in its network, alongside the publication of its full factory list to promote supply chain transparency.
In an official statement, Kmart said it had engaged with advocacy groups for more than a year, in an attempt to address their concerns and avoid legal action.
Industry observers have called the case “a potential landmark” in how businesses manage supply chain risks in high-risk regions. While some countries have banned the import of goods suspected of being made with forced labour, Australia has instead taken a transparency-based approach.
“Unlike the United States and the European Union, Australia does not ban imports linked to forced labour, nor does it impose a duty on companies to act on modern slavery risks – only to report them,” said Professor Shelley Marshall, RMIT University School of Law.
“This case may pave the way for a groundbreaking claim under consumer law for misleading conduct and calls into question the strength of Australia’s commitment to eradicating modern slavery.”
Currently, Australia’s Modern Slavery Act requires large companies to publish annual statements detailing the steps they have taken to address modern slavery risks, but does not prohibit specific imports. This places the onus on companies to ensure their sourcing claims are backed by robust verification processes and on advocacy groups to hold them accountable when concerns arise.
“Buying clothes should never come at the expense of someone else’s freedom. The alarm bells have been ringing for a long time in relation to the risk of forced labour in the Chinese garment sector, and Australian retailers have been on notice,” added Freya Dinshaw, Associate Legal Director, Human Rights Law Centre.
“This case also highlights some of the weaknesses in Australia’s modern slavery laws. It shouldn’t be left to members of the public to take companies to court and force them to open their books where there are suspicions of links to modern slavery.”
