Draft laws will bar non-compete clauses for those earning under $190,100, but employer groups warn the changes go too far
The Albanese Government has released draft legislation banning non-compete clauses for Australian workers earning less than $190,100 a year, the Fair Work Act high-income threshold, in a move it says will lift wages and improve job mobility, but which employer groups have labelled heavy-handed.
The reforms target clauses that prevent workers moving to a better-paying job. The government says more than three million Australian workers are currently constrained by a non-compete clause, including childcare workers, tradespeople and receptionists.
Non-compete clauses are contractual terms that stop an employee from joining a competitor or starting a rival business for a set period after leaving a job. According to research by the e61 Institute, one in five Australian workers is subject to a non-compete clause, and removing such restrictions could lift affected workers' wages by up to four per cent – roughly $2,500 a year for a typical worker.
"Non-compete clauses drag down wages, handcuff workers, and put a handbrake on labour productivity," Rishworth said. "Labor is determined to help boost job mobility for the more than three million Australian workers constrained by a non-compete clause, including childcare workers, construction workers, and hairdressers."
Leigh said the changes were about giving workers back control of their careers. "Workers shouldn't...
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