Maurice Blackburn welcomes new consultation on non-compete clauses

4 April 2024

Principal lawyer Kamal Farouque said:

“Currently, there is a massive overuse of restraints which affects the ability of employees to move and negotiate better rates of pay.

“This issue affects workers in a wide range of jobs and industries, including production workers in manufacturing, and non-managerial white-collar workers.

“Many of these restraints may not be valid in law - but the fact they are used creates uncertainty for people who don't necessarily have the resources to challenge them.

“I’ve seen a remarkable lack of discipline by employers who are crafting restraints that are unreasonable, and their overuse has an impact on employees and the broader economy.

“These clauses have a real impact on people, leaving workers feeling unsure about what they can or can't do in terms of their job prospects. This has a chilling effect on employees’ ability to switch to better paying jobs.”

Mr Farouque said caps on the duration of restraints, income thresholds for when restraints can be used and prohibiting employment restraints altogether are just some of the initiatives that could be raised during the consultation process.

“We welcome the Government’s move to reform the system. This is a very important initiative that will benefit workers, improve job mobility and encourage innovation.”

Media enquires:
Chee Chee Leung, Maurice Blackburn, 0412 560 584 or cleung@mauriceblackburn.com.au