Sydney Morning Herald - Latest News
· collected 2026-09-06 · by Shane Wright
Proposed federal laws, scheduled to be unveiled on Monday, aim to ban contractual restrictions that prevent people earning under $190,000 from switching jobs or taking better-paying positions. Research shows almost 47% of businesses use some type of non-compete clause, with client non-solicitation clauses used by over a quarter and bans on the solicitation of co-workers also common. According to a separate study, banning these clauses could lift affected workers' wages by up to $2500 per year. The government plans to offer exemptions for legitimate business interests while protecting jobs mobility for over three million Australian workers.
Written by the local model on 2026-09-06,
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Story summary
The Australian government plans to ban non-compete clauses, also known as contractual handcuffs, which prevent people earning less than $190,000 from moving to a better-paying or more interesting job. This move is aimed at boosting productivity and delivering better wages, according to Assistant Productivity and Competition Minister Andrew Leigh. Research by the Australian Bureau of Statistics has found that almost 47% of businesses use some type of non-compete clause, with bans on non-disclosure agreements being the most common. These clauses can act as a barrier to workers taking better-paying jobs, holding down wages and restricting opportunities. The ban is part of the government's plans to make the economy work more efficiently and deliver better outcomes for workers.
Written for “High Healthcare Costs” on 2026-09-07,
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Leaning score withheld for article 5739: score contradicts its own evidence · logged 2026-09-06
Contractual handcuffs that prevent people on less than $190,000 from moving to a better-paying or more interesting job would be banned under proposed laws to be unveiled by the federal government on Monday.
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that → prevent → Monday
The ban on so-called non-compete clauses, part of the government’s plans to boost productivity across the economy, follows growing evidence their use by some firms is having a “chilling effect” on workers whose skills may be better rewarded with another employer.
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skills → call → employer
Assistant Productivity and Competition Minister Andrew Leigh said banning non-competes was aimed at making the economy work more efficiently while delivering better wages.
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economy → say → wages
“Workers shouldn’t need their old boss’s permission to take a better job.
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Workers → need → 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.
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skills → act → jobs
We’re cutting that padlock,” he said.
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he → cut → padlock
Research by the Australian Bureau of Statistics has found almost 47 per cent of businesses use some type of non-compete clause.
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cent → find → clause
But the bureau found other restrictions, which have a direct impact on workers’ ability to use their skills in a better paying job, are widely employed by businesses including client non-solicitation clauses (25.4 per cent), non-compete clauses (20.8 per cent) and bans on the solicitation of co-workers (18 per cent).
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which → find → workers
Separate research by the e61 think tank has found that banning non-compete clauses could lift the wages of affected workers by up to $2500 a year.
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banning → find → 2500
Submissions to an inquiry into non-competes last year revealed the extent to how they are being used to reduce the ability of employees to move to new jobs.
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they → reveal → jobs
In one case, a person on less than $80,000 a year was barred from taking a job in the same industry in Australia and New Zealand.
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person → bar → Australia
In another case, a graduate engineer on $63,000 found a clause in their contract that prevented them from working anywhere else in Victoria for the next year if they left the company.
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they → find → company
Bricklayers, nurses and retail workers were revealed to have non-compete clauses that had traditionally been used in high-income professions in which trade secrets may have a particularly high value.
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secrets → reveal → value
Apart from the draft legislation on non-compete clauses for people earning less than $190,000, the government will also consult on a series of related employment restraints including non-solicitation and no-poach clauses and wage-fixing arrangements.
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government → earn → clauses
The government plans to offer “appropriate exemptions and safeguards” to protect what are considered legitimate business interests.
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what → plan → exemptions
This may include the transfer of corporate secrets with some businesses concerned that staff they have trained may take those skills to a competitor or set up their own firm.
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they → include → firm
Employment Minister Amanda Rishworth said non-compete clauses were hurting the entire economy.
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clauses → say → economy
“Labor is determined to help boost job mobility for more than three million Australian workers constrained by a non-compete clause, including childcare workers, construction workers and hairdressers,” she said.
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she → determine → workers
Consultation on the legislation will run until October 2.
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Consultation → run → October
