The Hon Andrew Leigh MP
Assistant Minister for Productivity, Competition, Charities and Treasury
E&OE TRANSCRIPT
RADIO INTERVIEW
ABC RADIO SYDNEY, DRIVE WITH EMMA CROWE
MONDAY, 7 SEPTEMBER 2026
SUBJECTS: Albanese Government banning unfair non-compete clauses, wage-fixing cartels and no-poach clauses
EMMA CROWE: Do you have a non-compete clause in your contract at work and has that ever limited your work opportunities? Do you even know if you have a non-compete clause? This clause, it can take a number of forms. It can hold you back from changing jobs by dictating where you can work in your next job. It can prevent you from taking on new clients in the same area as your old job. And I wonder if this is what's often called gardening leave, when you're paid to not work rather than be allowed to work for a competitor. Research by the Australian Bureau of Statistics has found almost 47 per cent of businesses use some type of non-compete clause. And the federal government is proposing laws today that would ban them for people earning under $190,100 a year. Andrew Leigh is the Assistant Minister for Productivity and Competition, and he's with you now. Hello there, Andrew.
ANDREW LEIGH: G’day Emma, great to be with you.
EMMA CROWE: Thanks so much for being here. What are you proposing, and are you looking at banning them altogether?
ANDREW LEIGH: Banning them for nine out of ten workers. For those workers that earn less than $190,100 a year. And this is because non-competes are popping up in all kinds of different employment agreements. One in five workers cop a non-compete from their boss, making it harder for them to move to a better job.
This includes early childhood workers, security guards and even yoga instructors. This is holding back not only workers getting better pay, but also a start-up entrepreneur who wants to hire workers away from an established firm in order to start up a new competing business. Non-competes are bad for the economy, bad for productivity and bad for the dynamism that we need to get back in the economy.
EMMA CROWE: You mentioned the child care worker. I mean, I just wonder how that would hold up legally, saying that someone can't go and work for a competitor. If that's what you're trained in, where else would you work?
ANDREW LEIGH: Well, that's one of the interesting things about these clauses. Sometimes when they go to court, it turns out they don't hold up. But a lot of workers don't have $100,000 and a lawyer sitting around waiting to take their case. So even an unenforceable non-compete has a chilling effect, stopping workers from moving to a better job because they're scared by the black and white of their employment agreement.
These clauses are a real problem for the economy and we're not only banning them Emma, we're also getting rid of wage fixing agreements. Because right now two firms can't get together to force up prices, but they can get together to force down wages. We don't want to see that happening any longer.
EMMA CROWE: Does that happen across industries where people get chatting to stop their people moving around and kind of fix wages at certain levels?
ANDREW LEIGH: We’ve had some shocking stories out of other countries where this is banned. In the US, a group of big tech firms got together in Silicon Valley to agree not to poach each other's workers. And we've got anecdotal evidence that's happening here as well. Just as a basic principle, we don't want firms to be able to get together to keep your wage low. We need people getting better wages. And the experts say that getting rid of non-competes means that affected workers will earn about $2,500 a year more. That's according to research from the e61 think tank.
EMMA CROWE: Talking about the non-compete clause, I wonder if you have one in your own contract at work, or even if you know if you have one? 1300 222 702.Have you been prevented from moving jobs because of a non-compete clause? And are they as bad as they sound? Have you ever challenged your boss on it? 1300-222-702, or you can text 0467 922 702. So, you mentioned some of the professions there, Andrew Leigh. What are the main professions impacted by non-compete clauses?
ANDREW LEIGH: Look, they’re replete in the gig economy. We also see them in professional services, but really anyone who's got a standard form employment agreement is vulnerable to having a non-compete thrown in there. Think about the way these employment agreements get drafted. Typically, it's the employer who goes off to an employer lawyer and says, ‘Can you draft me an agreement that's pretty favourable to me?’ And so, the employer lawyer says, ‘Well, why wouldn't I put a non-compete in there? Even if it's unenforceable, it's on balance going to be useful to the firm that I'm acting for’.
And so you end up with an employment agreement that's biased towards the employer, rather than biased towards the interest of the economy. Our economy benefits when people move to better jobs. We know the biggest pay rise you'll make over the course of a typical career is when you switch jobs, not a pay rise within the same employer. And that dynamic process better allocates people to where their skills can be best used and allows people to get out of dodgy jobs. Some of the worst stories about non-competes have been people who are being harassed at work and then told that if they move to a competitor, they'll be sued by a non-compete. Under our new reforms, that'll be illegal.
EMMA CROWE: Some research done by the e61 think tank has found that banning non-compete clauses might lift wages of affected workers by up to $2,500 a year. How does that work out in practice? Can you give us an example how that might play out for a worker?
ANDREW LEIGH: So again, if you've got the opportunity to move to a better job, often that better job will be a better use of your skills. You'll be more productive, and therefore the employer will pay you more. And so, if you can't move jobs, you can't get the pay rise. The e61 evidence suggests about a 4 per cent gain from getting rid of non-competes. We've also got evidence out of the US that's pointing towards a similar level of magnitude. One of the stories that I think should give people a lot of confidence that we can ban non-competes and have an innovative economy is that since the end of the 19th century, California has banned non-competes. Silicon Valley's growth was in part a function of workers being able to move to better jobs and set up competing companies. And that's the kind of dynamic we're keen to see in the Australian economy.
EMMA CROWE: How did you come to this figure, $190,100 a year or less? And will you be trying to put something to index that? You know, we talk about bracket creep with our tax rate, for example. I mean, as wages rise, does that number need to be reconsidered as well?
ANDREW LEIGH: Great question. That's the high-income earner threshold in the Fair Work Act. It's an established number that people are comfortable with and which is used in other contexts. It gets indexed annually. It went up from $183,100 to $190,100 on the first of July this year and will go up regularly in the future. And that'll mean that the threshold at which non-competes are banned goes higher and higher. We're also consulting about what to do with workers who earn more than that, because we also think there is an issue there.
EMMA CROWE: Andrew Leigh is the Assistant Minister for Productivity and Competition. I wonder though, whether there are some arguments for them. I'm thinking about if you run a business, you've trained up the staff and then the staff go and move on – maybe start up their own business and take some of your clients that you've worked with for years and years. Is that fair?
ANDREW LEIGH: Well, people can't steal information from a firm and there will be limitations on being able to solicit clients. There won't be limitations on trying to solicit co-workers. If you want to move to another business and take co-workers with you, that's a better opportunity for those co-workers. You'll be able to do that. But we do recognise that confidential information will remain protected under all of the existing laws. Just as you can't walk out the door stealing physical property, you can't walk out the door stealing intellectual property. And we understand that there is a value to the whole economy of getting more dynamism and more start-ups. This is what we have to do as a government, is to really prioritise the interest of the economy as a whole. Not any particular business.
EMMA CROWE: I mentioned gardening leave. You hear people just talk about this informally. ‘Yeah, I'm on gardening leave’. Is that what's happening? They're not allowed to go and work for someone else. They've left a job, and they're kind of forced to do nothing?
ANDREW LEIGH: Well, gardening leave is technically where you're being paid by the existing employer. So in that sense, you've still got a job. The behaviour we're cracking down on is where you don't have a job - you're no longer working for your existing employer but you can't work for another employer. You can't use your skills and that's bad for the worker, but it's also bad for the economy if we're preventing people from using their skills as productively as possible.
Some of the worst of it is these cascading clauses that might say, ‘You can't work for anyone in Sydney, or New South Wales or all of Australia, and you can't work for another competitor for a year or for six months or for three months’. And that means there's just a huge amount of confusion among the workers about what actually is binding them. Again, just slowing down mobility and the dynamism that we need in the economy.
EMMA CROWE: When will this take effect, these proposed laws you're interested in this week? When would this come into effect if it gets through?
ANDREW LEIGH: So, this is draft legislation that's out now. We'll be looking to have it in Parliament soon and have it coming into effect next year.
EMMA CROWE: Thanks for your time today.
ANDREW LEIGH: Thanks so much, Emma.
EMMA CROWE: Andrew Leigh is the Assistant Minister for Productivity and Competition.
ENDS