Whether you’re a child care worker, a tradie or a receptionist, you should be able to take a better and higher paying job without being held back by a clause buried in a contract.
Today, the Albanese Government is releasing draft legislation to ban non‑compete clauses for Australian workers under $190,100 per year (the Fair Work Act high‑income threshold). Our reforms will also ensure that workers are not held back by other unfair restraint clauses.
The widespread use of these clauses can lead to lower wages, and negatively impact labour mobility and productivity. Building a more innovative and productive economy depends on workers being able to move to jobs where their skills are most valued.
Research by the e61 Institute found that one in five Australian workers are subject to a non‑compete clause in their employment agreement, impeding them from moving to a better job. e61 also finds that a ban on non‑competes could lift the wages of affected workers by up to four per cent, or about $2,500 per year for a typical worker.
The Government will also consult on:
- a ban of co‑worker non‑solicitation clauses;
- a ban on no‑poach and wage‑fixing arrangements;
- a ban on cascading restraint of trade clauses; and
- appropriate exemptions and safeguards to protect legitimate business interests.
Together, these reforms will strengthen competition in labour markets, give workers greater choice and autonomy, and help to ensure Australians can go where their skills are most valued.
Submissions can be made online on the Treasury consultation hub until 2 October 2026.
Quotes attributable to Minister for Employment and Workplace Relations, Amanda Rishworth MP
“Non‑compete clauses drag down wages, handcuff workers, and put a handbrake on labour productivity.
“Labor is determined to help boost job mobility for themore than three million Australian workers constrained by a non‑compete clause, including childcare workers, construction workers, and hairdressers.”
Quotes attributable to Assistant Minister for Productivity, Competition, Charities and Treasury, Andrew Leigh MP
“Workers shouldn’t need their old boss’s permission to take a better job. Non‑compete clauses can act like a padlock on opportunity, holding down wages and keeping people from jobs where their skills are worth more. We’re cutting that padlock.”
